Dipula Properties Limited (DIB.JO) Earnings Call Transcript & Summary

Good afternoon, and welcome to Dipula's annual results for 2025. Thank you to those that are in physical attendance, and welcome to all of those that are dialing in. I'm here with the CFO, Sudesh. I'll go through the first part of the presentation and then Sudesh will take us through the financial numbers and then I'll come back and take the podium to just deal with the third part of the presentation. I think you would have seen the numbers in the media, but we'll just contextualize the numbers for you now. So as we typically always do, our presentation is in 3 simple parts, a bit of a business update, insights into our numbers, just how we see the market at the moment and then we drill a bit into the numbers, financials and then the way forward. So I'll jump straight to the portfolio. Basically, what we're seeing out there in the market at the moment is that there's definitely an improvement in liquidity availability, both from a debt and an equity point of view. We're also seeing a contraction of margin in terms of where we can raise new money. Obviously, I think there are some legacy things that Sudesh can sort of touch on in terms of old margin versus new margin where we can raise money, but the key thing is there's definitely an availability of cash, which is a lot better than what it was a year ago, 2 years ago and that sort of thing. That's interesting space for us then, which -- at the same time, if money is more available and people can swap out of assets into other assets or sell and/or buy to reposition their portfolios, that opens up the market for all the players to actually find each other from a pricing point of view. And that's really opened up an interesting pipeline for us going forward. And we're also seeing reducing interest rates. I mean, last year, at this time when we were sitting here, interest rates were about 125% higher than where we are now. I'm talking about benchmark interest rate. So 125%. Down from a reserve point of view. Contracting margins. Better times to actually start thinking about adding to your portfolio. And we're also seeing a very vibrant leasing environment, particularly on the retail side. We were just talking about it earlier. I was just saying to someone that it almost feels that particularly the sort of grocers and food retailers are taking up all the space that they are offered, generally speaking. Obviously, one needs to be very careful in an environment like that, that you don't pick the wrong locations just to satisfy that requirement, and you also need to think quite carefully about sizing of shopping centers and things like that and how strong the fundamentals are. There's definitely pockets of areas where for a number of reasons maybe the supply is sitting on the wrong side of town or there's definitely undersupply, land availability has been an issue for a long time. It takes a bit long to unlock all of that. So we need to sort of just carefully think about all of those dynamics. And I think the sizing of shopping centers also becomes quite critical now and thinking about whether it's that easy to duplicate what's there, because I mean, if it's easier to get to the other side of town or if it's a little bit better parked than your center and that sort of thing, you might actually sit with a problem. So there's a lot more asset management that needs to go into this, but you need to pick carefully. But where we find even more value is in buying existing and trying to improve existing, especially if existing is in good locations. We've also seen that retail sales that are reported by our tenants are fairly decent and there's growth there, not just inflationary growth, there's also unit growth. But some interesting reason that's still happening for many of the guys, and the guys are trying to outpace each other in terms of just getting into opportunities. I don't -- I'm not suggesting at all that -- we can charge extreme rentals trying to accommodate the guys, but I mean, you don't really have difficulty in trying to sort of secure a tenant in a reasonable site now at the moment. So that all bodes well for retail. Industrial is not really too far behind that because those 2 tend to track each other. We've seen some retailers building smaller DC centers for better logistics, feeding out of larger ones into smaller ones. And some guys technically just do smaller DCs because they get to market quicker. We've also lately signed up quite a good grocer out of KZN, a family business. They've got about 100 stores now at the moment countrywide. I think they're looking at being at about 150. A very different approach, different angle. They went into our Atrium center in the Joburg CBD, adapted product. They mainly cover low LSM, but they've also got product that covers high LSM. And what I understand is that there's concentration risk with some of the suppliers also in terms of how big some of the retail groups have become. So suppliers are looking to support these large buying groups that either support one brand or support multiple brands on the supermarket side of things. So the likes of Unilever quite friendly towards those sort of buying groups. If you ever wondered how guys sell at a certain point, sort of independents, particularly in the Joburg CBD, you'll find lots of foreign national businesses, small independents and that sort of thing. And those people are all part of massive buying groups and that's how they actually hold their own against the larger guys. And I think that sort of thing is also encouraged by suppliers to try and diversify their potential concentration risk to massive other sort of retail groupings. Just turning to basically our portfolio here. So we spent about ZAR 214 million in CapEx for the year. 54% of that was yielding CapEx and about ZAR 50 million of that -- ZAR 54 million was in respect of solar. And then the rest was mainly directed towards our retail portfolio, adding a win, announcing tenant mix, cutting boxes, doing that sort of thing. We now have solar at 14 of our retail properties and 1 industrial property, and we're installing at 10 other sites. Basically, what we are seeing is that, obviously, with a bit of clever asset management, you can sort of try and help those rentals along from -- if you're mixing it better, getting the box sizes right, monitoring trading densities and sort of being proactive in terms of speaking to the retail partners about just being honest about where they might be in a trading cycle. So we try and do quite a bit of that. We sold quite a bit of property. About ZAR 200 million of property was sold. It's a lot of sort of smaller assets. Quite a few of them were empty. And I think that is a very nice way of recycling that capital back into the portfolio. And residential portfolio is something that we indicated was -- we were going to sell, and we're making very good progress there. Hopefully, by sort of Feb next year, that portfolio would have transferred out, touch wood. And earlier this year, we announced basically roughly ZAR 800 million of acquisitions. About ZAR 60 million of that is transferred, and we're expecting the rest to transfer sort of between now and January, Feb. We might have a little bit of a delay with these office closing from about mid-December, but we're hoping to be in the deeds office before then for the bigger chunk of that. If you look at our 5-year growth trend, I think the story that we've been explaining over the years kind of continues. Portfolio is growing. 5 years ago, ZAR 9 billion, sitting at ZAR 10.8 billion. We never bought any property in the past 5 years. So this is all sort of through asset management interventions and that sort of thing. We're only starting to buy now. So that ZAR 10.8 billion is excluding the acquisitions that I was referring to. If I add that, then our portfolio sort of jumps to about ZAR 11.6 billion, ZAR 11.5 billion. And the average size has also been growing, as you can see in the graph, the below graph here. So all indicators of -- sort of trade out of smaller into bigger. And that way, we also -- we're not increasing our management team. So people are asking why is your cost-to-income ratio so competitive. It's because if I've got 5 guys running around to 20 properties in 20 different locations, they're still there when I buy a larger property and perhaps the property is actually concentrated close to where we've got other properties. So we think a lot about the dynamics around how we will manage the portfolio. So we're hoping that, that trend of sort of like just keeping our cost down, tactically down and that sort of thing will continue in the way we think about what we buy and where we buy it. Just looking at leasing, not a bad year at all. We did about ZAR 220 million worth of new leases during the period. And what you'll see in this number is that we locked in better escalations this time around than what we did last year. Last year, our escalations was about 7%. We're at about 7.4% escalation this year on average. And although the rentals achieved -- I mean, last year, we did [ 11134 ], now we went [ 10138 ], we've managed to actually lock in higher escalations. There's always a trade-off to sort of try and at least just capture something that has embedded growth in it. And then renewals, it just so happens that we had less renewals this period, because last year, we had quite a lot to renew. And there, across the portfolio, we achieved the positive renewal rate of 0.6%. So it was flattish, and weighted average escalations were in line with last year at about 6.5%. If we just look at valuations, discount rates didn't change much this year. What did change, though, is that particularly on retail and industrial valuers were taking a lot more positive stance on rentals. So the model is obviously discounted cash flow. So the assumptions on where leases were renewed going forward were a lot more positive than last year. And I think if -- I mean I think the 10-year bond rate is -- when I checked this morning, it's like -- I can't even remember. 9 point –- or was it 8.9% or something like that? Around 8.8%, 8.9%. This was done way before that started trending downward all that much. Some of them used that. Some of them have a very different methodology of valuing. But be that as it may, if you look at the discount rates between the 2 years, our average discount rate was 13.4% last year, 13.7%. So that did not change much, but they imputed a much more positive thing on the rental side. And I suspect that it has to do with how they look at the supposed numbers and where deals are closing out, because they got no other evidence on the back of that sort of thin disposal sort of stats that they're getting out in the market. They don't want to be too far off that. But there wasn't a lot of transactions last year. I think this year maybe there will be a few more transactions for the valuers to actually get more confident in believing that the market is moving in a positive direction. But be that as it may, our retail is basically 10% up on a like-for-like basis and offices were down 0.7%. Again, they knocked down the rentals quite a bit there. And I can understand why. Oversupply issues, where our office buildings are located still. And basically, industrial up and residential went down a bit. But there, it's because we took quite a big discount on our rentals last year, this year, where you'll see in a later slide that, that's actually led to us halving that residential vacancy. But once you lock that in, I don't think you can increase by much more than 5%, 7% and that sort of thing, because otherwise, the guys just move out and you kind of just sit with -- you have to replace them. And as you replace them, you don't have a consistent pattern. So the safest assumption to make there is that a guy will come in and you maybe increase it by 5% or 6%. I think that's what the valuers did here. Retail portfolio, already spoken about that valuation and what happened there. But I mean our rentals are trending upwards. So if you just take the in portfolio sort of average rental, so that's putting the new leases that we did with existing leases that are in escalation and that sort of thing, and you sort of blend those 2 things and you see what you achieved between the 2 years. That's gone up by 5% in the portfolio. So retail was also the one where we took that minus 0.6% that I showed you earlier in terms of the renewal rate there. And trading densities were up 4% in our retail portfolio. And I'm pleased to report that after our street explosion there in Joburg, we've finally completed the Atrium. And that street was about 2 streets away from us. This is our only property in the Joburg CBD, but it's our back trading and we've got a very nice anchor tenant in it. It's not fully let yet, but I mean there's very good potential uptake there, lots of inquiries for the space now that we've got a tenant trading in it. So basically, vacancy down from 6.4% to 5% in this portfolio. A lot of that vacancy is still concentrated in some of those CBD properties, likes of Vanderbijl and those sort of towns that we know are not coming back. So we need to obviously ensure that in some way or the other we try and trade out of those or find alternative uses for them. And the weighted average rentals has trended upward there. Weighted average escalation is about 6.4%, consistent with last year in the retail portfolio. And we had a very good 15% tenant retention ratio. We will never have a 90% or 80% for the short term here because we're definitely trying to wash out the less sort of quality credit tenants out of our portfolio. So I think one day when we get to our sort of ideal sort of mix of credit, maybe we'll keep that a bit higher than where it is now at the moment. Right. This just gives you a better picture of lease expiry. We've got quite a bit, 91,000 square meters coming up next year. And then it sort of flattens after that. And then basically, if you sort of -- if you compare 91,000 -- so this year, we did -- last year, we renewed 80,000. This year, we renewed 61,000. So then 91,000 we should be able to handle also. And we did quite a bit of new business in here last year. 23,000 square meters roughly is what we let to new users, new tenants. This year, it was 25,000, and at the weighted average escalation of about 7.2, just under 3 years of WALE. And basically, on the renewals, we did about 253 leases, ZAR 500 million. This is the bulk of our work, is on the retail side. I mean you'll see probably in the teens when you get to office or industrial and that sort of thing. I mean, there's far less leases there. Our activities all here in retail. And we were slightly down on the renewals at about 0.5%, call it flat from a reversion point of view. This just gives you a better picture of trading densities across the portfolio. Basically, food and grocers were up just about 0.4%. Again, I need to contextualize this number, because during COVID, our type of centers were flying. I mean those turnovers were extremely high. We took away so much turnover from super regionals during that time. There's a bit of a return to super regionals from us, but the convenience factor is still not going away. So there's still an increase in trading densities. I also suspect that there's somewhat of an impact from online here, especially Sixty60 because the guys don't report those numbers to us. They keep those out of the turnovers. So that number might also be affected by that. And then the fashion and footwear was up nicely, 3%, and restaurants are definitely back in business at about 12% year-on-year. And overall, the movement in trading density was about 4% and our cost of occupancy is 4%. So a very limited risk of extreme negative reversions in the portfolio in my opinion. So offices, the vacancy trended upward. When we reported pre-close, we still thought we were going to renew one large tenant in the portfolio that moved out. So that kicked our vacancy up from -- I think it was about 18% when we reported then to about 26%. Year-on-year, obviously, it's up from 22% to 26%. Still a small component of our portfolio. So we don't really feel the impact all that much. Rentals are still up year-on-year. So our average rentals are 150 as compared to 140 last year. So that also shields that temporary vacancy. We believe that, that vacancy that we experienced in that particular property, we should be able to actually close that out. But the big thing in this portfolio that I'm quite excited to report on is that we were holding, I think -- I don't know if this pointer works, but we were holding about 13,500 square meters of developable or convertible bulk last year. We actually sold more than half of that, and it's in that sales number that we reported. So instead of pumping more money into those conversions, especially into residential that we now no longer want to do, we unsold that bulk. So we'll probably sell the rest of that bulk also, and that mainly is vacant property there that we had earmarked for development. So that's really the strategy, to sort of just try and get out of that. And yes. So the property that was vacated is Steve Biko Corner. That was in August this year. Unfortunately, that tenant left. Got about 30,000 square meters of office vacancies coming up next year -- sorry, expiries coming up next year. And from a leasing point of view, we did 23 leases this year, small deals. I mean, 23 leases, 4,700 square meters. There's not a lot of activity there. And basically, rentals are trending down. Trying to move that space. Still achieving good escalations on the deals that we did, but it is encouraging that, that 5,000 square meters or so, we achieved almost 3 years of lease tenure. So where we can, we try and move the space. And from a renewals point of view, did about 22 leases this year, and it was a positive renewal rate of 0.9% -- sorry, where's the -- I can't see it here. 7.4%, sorry, renewal rate at an escalation of about 7%. So it's a bit of a mixed bag. Not a big deal in our lives, but we need to manage it, we need to deal with it. Industrial vacancy trended up here. Lost a park tenant at New Brighton, lost a tenant at Corporate Park last month of the year. Both those holes have been closed. So I mean that vacancy is right back at below 3% now again. Highly lettable stuff. And basically, like-for-like, as I indicated in that previous slide when I started the conversation, the portfolio was valued about 4% higher. We announced some acquisitions here in the industrial portfolio. We bought many -- sort of a multi-park store close to O.R. Tambo. Market is very vibrant there. I mean, very high rentals being achieved, undersupply. Not a lot of zoned land left there. Freeways, everything good, good location. So we bought that. And then we also bought the newly developed warehouse that will host or house Bayer on a 10-year lease. I mean very good lease covenant there, about 16,000 square meters. Right. So from a leasing point of view, we did about 19 -- 20,000 square meters of new leases here. So quite a nice activity there, bearing in mind that we don't –- we didn't really have a massive vacancy in this portfolio. And weighted average escalations of about 7.5%, WALE of 2%. Why is that WALE so short? It's in the mini units that we've been doing those leases, so shorter-dated leases. And renewals -- again, it's mainly the mini units. The big boxes, longer leases and that sort of thing. You can see there, we renewed at just flat of where those leases expired. Last year, we actually went back quite a bit, but it was a specific situation. As you remember, it was Sterkolite, which was that hangar that we rent out to government that we renewed for 5 years. We took out a big rental knock there. But it's now all fine on a 7% escalation. So we're good there. Okay. I'm not going to spend too much time here, but to just show you that even though we took a bit of a knock on the rentals to sort of generally flat, because I think we got shielded a bit by the fact that there were also sort of vacant units where we could kind of increase that rent, maybe compromise a bit on the guys that are in occupation to shield that on the rentals. So fairly flat, but the vacancy has come down. So contribution of this portfolio is still -- last year was 4% of our NOI. It's 4% this year, even with all of the maneuvering that we did to try and lease it. So it's not very bad. But it's just -- it's not our thing. So we need to hand it over to people that can do it better than us. Just looking at ESG. Because of the solar that we're rolling out in the portfolio, we substantially increased the avoided carbon emissions in our portfolio by 240% to 7,006 tons of CO2. And our green energy is now accounting for 5% from 2% last year. So that's a number that you'll continue seeing up. It's like we're really just scratching the surface here. So there's quite a bit to still do here. So we're investing another ZAR 90 million in PV for what we call a Phase 2 now in 10 properties. That's 10-megawatt peak. And December this year is the deadline for all of those energy performance certificates. We're done with all of that. So I think we'll tick the box. Out of the -- I think we did 12 properties that qualified. Out of those 12, I think 2 indicated red in terms of consumption, energy consumption. The one property is a property occupied by AICI. It's an office building, but I think they've got a lot of machinery in there. So that's consuming quite a lot of electricity. But the rest were yellow to green. So we're not looking too bad in terms of our energy consumption in our office portfolio. These EPCs only apply to offices so far. They're not really asking for any of that on the industrial and the retail assets. And we're also hard at work on the water side. Some of that out of necessity. Supply of water in some of the municipalities is a bit of a shocker. So we're finding sources, other sources of water. We're storing a bit more. And I think between that and the energy greening side of things, that's what's keeping us the busiest at the moment on the sustainability side, just dealing with water and security and dealing with energy. We improved our BEE rating from a 4 to a 2. Sudesh tells me he's going to achieve a 1 next year. So this challenge is set out. And basically -- I mean, as you know, we spent quite a lot of our time in the townships trying to make a small contribution towards solving the big problems there, drugs, getting the kids on to sports fields just so that something happens on Saturday other than waking up with a hangover. And I mean, I don't know how much exposure we have to that sort of thing, but it's quite serious. So we're trying to do our level best there to make a tangible difference. A lot of that comes in the form of our people putting their own time into it. So lots of volunteering and lots of motivational speaking. And we've also got a bursary scheme for our staff members. We had our first 3 graduates this year out of that. So we're encouraging our people to sort of just self-improve and that sort of thing. So that's not for their children, it's for them, because what we find is that especially in property management -- we employ a lot of people that have experience. They come through the ranks, but they haven't actually improved themselves. They become better staff members after that because they think a bit different. So we're encouraging quite a bit of that. So this is just a better color on basically how those avoided emissions sort of stack up. You can read it in your own time.

Thanks, Izak. Good afternoon, everyone. I'm going to start off by touching on some of the financial highlights. The strong underlying performance of our core portfolio has assisted us in driving revenue growth, which you see is up 4%. And that has assisted us in achieving a distributable income of ZAR 521 million, representing a 5% growth, that translated to a distribution per ordinary share of ZAR 0.57. The Dipula balance sheet continues to show strength, and that's illustrated by the growth in our property portfolio that has risen by 6% on the back of strong valuation upticks that Izak touched on earlier. That has assisted us in achieving a NAV of ZAR 6.8 billion, and the ZAR 6.8 billion represents a 7.5% increase from the prior year. In the current period, we added another ZAR 200 million of further debt, and the debt was reinvested into our portfolio in numerous yield-enhancing initiatives that range from an acquisition of an industrial park that we mentioned as well as the solar implementation of around ZAR 54 million and other yield-enhancing initiatives. At the end of August, our shares traded at a discount to NAV of 25%. Providing a little color on our distribution statement. You see our revenue has grown by 4%. Rental income has grown by just close to 2%, and that takes into account certain properties that we have disposed of as well through the period. That's not in our numbers in the current year. Recoveries has seen growth of around 12%, and that's consistent with the municipal tariffs, you do see year-on-year increases. And our property expenses have seen expense growth of just over 6%. And what you find in these numbers are some of the benefits of our solar implementation. So the impact of that would be reduced consumption from the grid, and that has resulted in obviously a reduced cost in our numbers. That has all combined in achieving an NPI growth of close to 3%. Our administrative and corporate costs has increased by 7% with savings seen in our finance costs just under 2%, and that's a testament of lower interest rates that we have experienced of date. This collectively has contributed in us achieving a distribution growth of 5%. The distribution earnings per share bridge basically shows an increase of just under ZAR 0.03, and the ZAR 0.03 is growth, is largely affected by the strong performance of our core portfolio. You see there's an increase of just over ZAR 0.03. That translates loosely to around ZAR 30 million. And that was partially offset by some of the properties that we disposed of that contributed to a negative ZAR 0.05. All combined, this relates to a 5% growth in our distributable earnings per share. Our sectorial performance, as you can see, breaks up our performance from a net property income in gross rental, including municipal recoveries, property expenses and net property income. There hasn't been a significant shift between the sectors. You'll see on the net property income, the retail sector has performed quite well. We've seen strong growth in our underlying growth in our leases. That's contributed to the performance in the retail sector. The office sector has had challenges with regards to stubborn vacancies at some of our properties, but we also disposed of some of our office properties that have been removed from the base. The performance in our industrial sector has been flat year-on-year, and that is due to several industrial properties that have been disposed of in the last 12 months. Jumping into our cost-to-income ratio. Dipula historically has always maintained quite good cost efficiencies, and that is evident in looking at our total cost to income of 43%. There has been an increase from the prior year, and that roughly is around a 2% growth, and that is driven by rental income growing by 4%, whilst our expenses have grown by 6%. The admin cost centers has seen a stable -- stability at just over 3%. And when you look at our admin cost of 3% and total cost to income of 43%, these percentages are actually quite favorably positioned when we benchmark ourselves against other listed funds. You find that these increases are pretty much consistent across the sectors with some savings seen in our residential sector, and that is due to historical or prior year higher tariffs charged on some of our residential properties that didn't repeat itself in the current year. Moving to our statement of financial positions. Our property portfolio has shown 6% growth, as I mentioned. Strong collections on our trade debtors. We see around a 99% collection rate. Whilst we've collected quite well on our debtors, you see that other receivables has grown by 19%, and that's as a result of several property guarantees that we provided before year-end and these relate to certain properties that are in the process of being transferred. Our derivative financial instruments, basically, this relates to fair value of our swaps. The prior period indicated a net asset position of close to ZAR 9 million. And as a result of different market conditions, this position swapped out from a net asset position to a net liability position of ZAR 21 million. That takes us to a total asset position of growth of just around 6%. Under our liabilities, there hasn't been significant movements in our liabilities with just an increase in our debt. And our additional debt was reinvested into our property portfolio with acquisitions of the industrial property as well as other enhancements. It takes us to our NAV per share bridge. And these movements, as explained, are quite evident in the bridge with property valuations being a significant contributor of a 7.5% increase in our NAV per share. Moving on to our debt profile. Dipula has quite a stringent debt process in the sense that we quite manage our key metrics quite well, and that's quite evident in the numbers you see in front of you. Our LTV has improved to around 35% and our interest cover ratio of around 2.8x, and both are quite favorably positioned against our covenants of a LTV of 50% and our ICR of 2x. Our liquidity position at period end, at the end of August, was close to ZAR 200 million, and that is made up of a combination of surplus cash as well as access to undrawn facilities. Our total weighted average cost of debt is around 9.3%. And Izak mentioned earlier that there is some benefit that we've seen with regards to engaging with the market and the funders on possibilities of new funding. New rates are ranging all in between 8.3% to 8.5% between 3- to 5-year debt at the moment. Our interest rate hedge at period end was at 68% and has improved post financial year-end with us taking an additional ZAR 300 million swap at the end of September. Our weighted average debt expiry is just over 3 years and we have a hedge expiry of just over 2 years. Lastly, from a cash flow position, significant movements on the cash flow range from our -- an increase in cash generated from operations that increased 5%, and this is a testament to obviously growth in our NPI. We've also seen a decrease year-on-year on our net finance costs, and that's related to obviously a decrease in rate climate. The acquisitions and CapEx has seen an increase when measured against the prior year, and this is due to a combination of a new acquisition that occurred at the end of August as well as obviously solar that's been deployed as part of Phase 1. The improvement in the general trading conditions in the market has resulted in us disposing of further assets that resulted in ZAR 114 million of proceeds that's indicative on our cash flow statement. And the net finance cost or net financing of ZAR 123 million is made up of ZAR 200 million of new debt facilities that has been offset by permanent repayments made on our debt facilities on those properties that we have disposed of. Collectively, these have all resulted in us achieving a final cash balance at year-end to around ZAR 96 million.

Yes. I think as I started the presentation, I think the improved liquidity holds great potential for us. Tap into that, grow the portfolio a bit with the type of assets that we want in it. And I think if you looked at the cash flow statement that Sudesh was presenting there, we spent ZAR 214 million on portfolio improving redevelopments, CapEx basically. So we're going to continue to spend on CapEx. I think it's important for us to actually keep these properties lettable, highly lettable. The core portfolio we need to look after quite well and that sort of thing. Dispose of those that we don't want. And then the stuff that we're doing on renewables and the stuff that we're doing on water will hopefully not be just defensive, but also be enhancing towards earnings because you are paying quite a bit for those utilities from the suppliers of those utilities without actually getting a reliable supply of it. I think the energy space is very interesting. I mean we're just scratching the surface there in terms of all the things that are being done in the market and can be done. So we're paying quite a bit of attention to that. Outside of rooftop, there's lots of other interesting things that can be done to bring down -- to try and increase margin for us in that space. And so we'll continue to raise new capital at the right sort of levels for deployment into new better assets. Sell assets, redeploy the proceeds into either repaying debt and/or sort of just recycling into the portfolio itself. And I think the sustainability journey is really, really exciting, because, I mean, if you adopt it for all the right reasons, it's actually business improving. I mean, if you look at –- if you go to places like Soweto, for example, we did our first sort of water plant there. And I mean, there was lots of outages there. So you either keep water in tanks or you kind of just generate your own water and that sort of thing. And from that point, your tenants are thinking different of your center, customers are thinking different. I mean I think water is actually more important than electricity if you think about it, because with electricity, you kind of -- it's expensive to run a generator, yes, but you can still run a generator and go on. But when there's no water, it becomes a very tricky situation, whether you can actually keep that center open. So we need to respond to that without sitting in a corner and complaining. And that's exactly what we're doing. We've got a very interesting acquisition pipeline, very exciting and definitely talking to portfolio improvement. And there's quite a bit of automation stuff that we have embarked upon. Objective is, again, it's keeping that eye on costs, trying to do the same things more efficiently, less people or the same number of people. There's quite a bit you can do with tech. We're testing out various things, and I think we'll provide more color on those things as we implement them. So yes, very exciting times now for us. And we are guiding 7% per share. I think when we first released the announcement, there's a bit of a mistake. We will do the announcement and post the new one because we just said 7% distributable income. But it's per share, just for clarity and so on. And that's the story for this year, guys. Thank you very much. And we'll take some questions, but you're also more than welcome to pull us aside or request a one-on-one if you'd like to. But yes, happy to take some questions now, yes, online and...

Nothing. There's nothing online. In the room? Nothing. Okay. Thank you very much. I will go enjoy the spread.