Spear Reit Limited ($SEA)

Everyone. It's wonderful to see so many familiar faces here. And also just to acknowledge our Chairman, our Board of Directors, Investment Committee Chair, Mr. Brian Goldberg; our Chairman, Mr. Abubaker Varachhia; Non-Executive Director, Bongani Raziya. Just fantastic to have you all in the room this morning. It's obviously for myself and the team, an absolute privilege to present these results. We're very proud of them. And I also want to just extend a warm welcome to those joining us on the Spear YouTube channel today. And if we get to the question side, I'll give a little bit of direction as to where that -- when we'll kind of deal with those questions. Right, so FY 2026 has certainly been a year that reflected disciplined execution by a great team, strategic operational, financial and investment clarity, and the resilience of the Western Cape-only platform. As a management team, we've been maniacally focused on top line revenue growth, cost controls and net operating income growth during the year while successfully executing on our growth objectives that we set out for FY '26. Just what we're going to be covering during the course of the presentation. As I said, if you have any questions and you're in the audience, if you can just state your name and where you're from, and we'll answer those questions after the presentation. If you're online, you can e-mail those questions into [email protected], and we will answer them after the presentation. Joining me today are two of my executives, Christiaan Barnard, our Chief Financial Officer, who will share the financial and sustainability updates for the business; and Kim Pfaff-Karg, our Chief Investment Officer, who will share with you how we spent our capital during the year and also recycled some. So just a quick recap. Spear remains the only regionally focused REIT listed on the JSE that exclusively invests into the Western Cape. Our mission, which is very clear, is to be the leading Western Cape-focused REIT to grow our distribution on an annualized basis and to operate within the top quartile of our peer group. We are very clear on our operating strategy, and that's to be value investors across the various asset types that we invest into, using asset management initiatives to strengthen our net cash flows to remain an authentic, consistent and sustainable dividend-paying Western Cape-focused REIT to own high-quality commercial, industrial, convenience retail assets within the region that generates fixed income for the portfolio to prudently and optimally recycle capital on an ongoing basis, to maintain an asset management approach to everything that we do, which results in strong tenant relationships as well as high occupancy levels across the diversified portfolio and to consistently execute on our smart strategy, and I'll break that down in more detail further on in the presentation. And to also proximity for us is critical, being close to our tenants and close to our assets does give us what we believe to be a competitive advantage. And finally, to operate with a strong, resilient and robust balance sheet, which at any given time can range between 38% and 43% loan-to-value with a very strong interest cover ratio dependent on where we are in the cycle. At our core, Spear remains a high conviction, regionally specialized REIT. Now our strategy is simple but deliberate. We own high-quality assets in well-located nodes that are economically robust. We allocate capital with precision and continue to build and operate a portfolio that can perform consistently through every type of property cycle. FY '26 is a clear demonstration of our philosophy and strategy in action. As we continue to grow the portfolio, we are of the opinion that the Western Cape is the investment case for South Africa, and here are a couple of summary points. The Western Cape offers the most defensive and scalable real estate investment case in South Africa, underpinned by governance certainty, immigration-driven demand and sustained economic outperformance. What gives us this level of conviction, taking into account a couple of data points, notable share of GDP, 14.3% of national GDP is generated in the Western Cape, which is just under ZAR 681 billion. Now if you look at what the projections look like by 2030, we should be a ZAR 1 trillion economy. We are a diversified economy, which is not as reliant on the volatility of the commodity cycle. We've got the lowest unemployment rate in South Africa, 18.1%. And anecdotally, over the last 5 years, 9 out of every 10 people employed in South Africa were employed within the Western Cape. The Premier has a quote where he says that nothing stops a bullet like a job. And that really is the case. If you look at the economic outperformance within the Western Cape, if you look at the labor force participation rate, we've got the highest labor force participation rate in the country at just under 70%, which means that there's more people participating in the active economy from a jobs perspective, which puts more money in people's pockets, which they get to spend in our shopping centers, which they get to buy from our factories, and they get to rent office space from us. We've got the highest household income in the country, about ZAR 407,000 per annum. And why is that important? It's important because we've got a growing population, both within the Cape Town and within the Western Cape, 5.2 million people living in the Cape Metro at the moment and about just over 7 million people in the Western Cape. By 2030, that should be 10 million people, which means that people need to live somewhere, and that creates growing residential nodes, which creates retail opportunities for us. People need to work somewhere within those nodes, given the cost of transportation, you'll find that some decentralized nodes will become stronger and stronger like the Northern suburbs in Tiger Valley, we believe will continue to outperform and as you see where vacancy rates are. And again, even provincially, again, we see the entire province from an infrastructure perspective as a great investment opportunity. We've got a diversified future-facing economy. If we look at the types of economies we find in the Western Cape, financial services, technology services, business process outsourcing, tourism, services sector, which is very, very well diversified, which is a great moat around the province. The city of Cape Town, it is the urban economic engine of the Western Cape, contributes 71% towards provincial GDP. This is certainly a metro that spans 2,500 square kilometers that does exactly what it intends to do, service delivery as well as growing the investment case for the city of Cape Town. We'll be spending ZAR 40 billion over the next 3 years on additional infrastructure. When you count to the Western Cape compared to the rest of South Africa, very much more a structurally resilient province compared to the slightly weaker macro in South Africa. If we look at energy, we look at water, especially in the last week or so, we've got an economy that is very much performing above the benchmark in South Africa. So as mentioned, these are some of the data points as to why we seek to only invest in the Western Cape, just given the provincial underpin, the governance certainty and infrastructure investment. So we'll continue to do that, and we see the whole of the Western Cape as an investment opportunity for Spear, even Robin Island. Right. So now moving on to the highlights. One of the highlights of a phenomenal result for us for FY '26 is that at the middle of May last year, we guided 4% to 6% growth in our distributable income per share. We've exceeded that growth to around 6.02%, which is really just a fantastic achievement by a committed and dedicated team. That translates into a distributable income per share of ZAR 0.9070. We apply a 95% payout ratio to that, which is 0.8616 per share. Our portfolio within the Western Cape has expanded over the year. We acquired 3 high-quality Western Cape assets across the strategic asset types that we invest into at around ZAR 1.08 billion. That added 137,000 square meters of additional high-quality GLA to the portfolio, generating an average return to Spear shareholders of 9.54%, which is well ahead of our cost of capital. Having a look at the portfolio at a glance, if I scale -- if I just look back over the last two years, we've really been incredibly blessed to have the growth opportunities we have. The portfolio is at a value of ZAR 7.18 billion, which is just under a 30% growth compared to the prior year, which is really fantastic. High-quality assets, ZAR 42 in total currently with a gross lettable area of 630,000 square meters. We've generated strong operational performance. Our weighted average lease escalation is still above 7% and our occupancy rate has continued to improve to just over 97%. Our weighted average unexpired lease term, these are some of the tongue twisters that we now have to deal with in terms of the new disclosures is basically the period upon what our -- how long our leases still have to run. That's 30.28 months. Now if I look back where we came from out of COVID, where we said our priority was tenant retention and rent preservation, we would be willing to renew leases on slightly shorter terms because we could see potential future upside opportunities. We are now reaping the benefit of that, where we've worked really hard in getting that weighted average unexpired lease term closer to the 36-month strategic objective that we set out as a team. Rent reversions were slightly negative on a renewal and relet basis. But positively, the core portfolio generated a 6.02% positive rent reversion on renewals, which tells us that from a property management, asset management and a leasing management perspective, the team did exceptionally well to get that level of growth out of the renewal part of the portfolio. And on the counter to that, the slight negative reversion is something that we planned for within our forecast and was able to be absorbed without impacting the financial performance for the period. Our balance sheet remains primed for growth. It's exceptionally well managed at a 22.94% loan-to-value. Interest cover ratio very robust at 4.34x, and we remain highly liquid with available cash prior to our raise at ZAR 382 million. Our cost-to-income ratio at 45.36%, our property cost-to-income ratio at 38.55% and our admin cost-to-income ratio 6.86%. Our CFO will unpack that in more detail as we hand over to the financial presentation shortly. Collections remain strong. I think it's the old adage that cash is king. And that is when you look at the cash flow that we generate as a business after covering all our costs, very strong at ZAR 96 million with a cash collection ratio of just under 100% year-to-date end of Feb. If I look at our PV strategy, this will probably be the first, call it, reporting year where the acquisition of the Emira portfolio, we implemented the PV rollout. And you'll see that in the revenue generation in the net operating income contribution that the PV portfolio made to this overall portfolio. 27 assets with solar infrastructure, 2 systems currently under construction. Those will be completed between Q1 and Q2 FY 2027. And as I mentioned, ZAR 31.3 million revenue contribution, which is around 4%, generating around ZAR 21.8 million towards our NOI. Then having a look at our tangible net asset value. As it stands at year-end, ZAR 5.38 billion. That translates to ZAR 12.91 per share. We raised ZAR 749 million in new equity in June 2025, which was really well supported by our shareholders. We also concluded ZAR 152 million Section 42 asset share swap, which was the acquisition of the Berg River Business Park in Pal, giving us around ZAR 430 million gross shares in issue. So moving on to the corporate performance. If I just look at the first bars, if you have a look at your total return, assuming that you reinvested your dividend, over a 5-year period, we generated a total return of 32.19% over 3 years, 31.64% and over 12 months, 46.5%. Now effectively, if I take up to December 2025, we outperformed every other asset class in South Africa as a company. If I take up to the end of Feb, we just -- we did not outperform equities, and we didn't outperform gold. But for everything else, so I reckon we've set a bit of a gold standard for our business. Then again, liquidity. If I look back from 2016 to 2026, liquidity certainly has been a journey for us. Some days were less encouraging as others, but I really believe that in FY '26, our liquidity came of age. We have, as I mentioned, 430 million shares in issue. We traded more than 25% of all shares in issue during the year, which translated to about ZAR 1.2 billion worth of shares traded. And already, FY '27 looks very much like it's going to outperform FY '26. And that was also largely contributing to the inclusion in the SA REIT Index and the -- all Property Index on the 23rd of March, where funds that had the mandate to do so were able to preposition themselves in the correct manner to take advantage of the index inclusion and the potential upside that would come from that. Then just having a look at more granular detail in terms of the portfolio overview across the retail, commercial and industrial subsectors, which are the core pillars of our investment strategy and investment philosophy. On retail, around 80,000 square meters of retail GLA and will be growing later this year as we take the transfer of Watergate in Mitchells Plain. Occupancy is strong at 97.56%. Collections, equally strong at just under 100%. Reversions, pretty much flat on total renewal and new renewal reversions ahead of inflation at 4.30%. In-force escalations, 6.61%. This is an area where we're also looking to try and push those escalations back up to above 7%. And with the acquisition of Maynard Mall during the year, that came in at a slightly lower average escalation rate, which obviously, given its scale, did push that average down a little bit on retail, but we don't see why we can't get it back to above the 7%. And also just talking about Maynard Mall, we successfully onboarded it. The interest from nationals to generate more tradable area within Maynard Mall has been really welcoming. And we do believe that there's some additional GLA and non-GLA upside that we can generate out of that asset in the near term. Just in terms of commercial, around 127,000 square meters of GLA. Occupancy at just under 93%. We also had great momentum during this year, generating good leasing momentum within the commercial office space. Collections, as I mentioned, just under 100%, reversions were negative 6%. Now I don't want to kind of skirt around this issue, but the reality is that rents don't always go up. Sometimes rents do either go sideways or go slightly down. We don't shy away from it. We budget for it, we plan for it. And when it does eventually happen, we mitigate it by retenanting that space as quickly as possible to reinstate the cash flow. Renewal on renewals only, you can see the leasing team did an exceptional job at 4.54%. Our in-force escalations robust at 7.23%, which is fantastic because if you look at our average expiry profile, you'll see the compounding benefit that we get out of that escalation on an annualized basis. Then looking at industrial, which is certainly the cornerstone of the portfolio, 422,000 square meters of gross lettable area. Occupancy is 98.6% collections equally strong at 99%. Reversions positive at 2.14% in totality, renewals and new let. Renewal reversions very strong at 7.84%, in-force escalations at 7.11%. And very, very proudly, we've broken ground in George, and we will also be breaking ground in Blackheath in August, which again will add organic NAV unlock to shareholders going forward and the sustainability linked project at Mega Park is anticipated to be completed by the fourth quarter FY '27. And just having a look at the sectoral split by value, revenue and GLA, spoken about the valuation on the portfolio. But what you can see here is a well-diversified portfolio where Reliance is placed from an income and revenue perspective in the right subsectors within the portfolio. We went to great effort to create that kind of equilibrium effect between commercial, industrial and the kind of upside or upswing in retail from a revenue and GLA perspective will be seen on an ongoing basis as we move through the year. Just breaking that down even further. The industrial portfolio is valued at ZAR 3.1 billion across the 422,000 square meters, strong occupancy rate at 98.6% contributing ZAR 337 million to group revenue across the manufacturing, urban logistics, logistics and mini/multi-let industrial units. Commercial, ZAR 2.5 billion in value across 127,000 square meters. The occupancy rate is strong, but there is room for improvement, contributing ZAR 316 million towards the revenue for the year. Then in retail, for the first time in FY '26, we've reached ZAR 1 billion plus in our retail portfolio with the acquisition of Maynard Mall. That takes -- obviously doesn't take yet into account the Watergate acquisition, which will bring us closer and closer to a ZAR 2 billion retail portfolio, which we think is -- which is a fantastic result because we really have been patient in making sure that we buy the right asset at the right price because we also believe that you create value not just when you sell the asset, but actually also when you buy the asset. In terms of revenue contribution, slightly lower than many of the other 2 subsectors at ZAR 156 million, but that will certainly scale over the next year or so. Our rent to turnover ratio is 9.28%, our trading density at just under ZAR 3,000 a square meter per month and our effort ratio 10.35%. Now we believe that all three of these metrics perfectly align and are very much in line with where we want to be because these assets are what you call high volatility commuter convenience retail assets. Therefore, we believe that these metrics all align with the standard we want to set. Then just having a look at the letting activity for the year, we had 157,000 square meters come up for renewal and relet. We relet 156,200 square meters at an average rental negative reversion of 2.28%. On renewals only, just under 60,000 square meters came up, and we relet pretty much just on 60,000 square meters at a positive reversion of 6.02%. Our tenant base is extremely diversified, and that also is defensive in nature. If I look at the 630,000 square meters of GLAs we own, approximately just under 613,000 square meters is occupied, which is a 2.72% vacancy rate. Now if you have -- if you drill it down, obviously, there's -- we want to do even more and better work in the office portfolio with 9,000 square meters vacant. Industrial, 5,600 and retail, 1,965 square meters. This is as at the end of Feb and some positive inroads have already been made into some of these vacancies, which we'll delve into in the half year interim results. We've got 659 tenants within the portfolio. And you can just see here the general makeup of the portfolio tenants. As I mentioned earlier, lease expiry profile. This is a very benign lease expiry profile with about 19% of our renewals and leases coming up annually. So effectively, we've got 81% of our leases that continue and roll for that 30-plus months, which is very defensive from our perspective. And also, I'm pleased to note that the expiries that look at March '26 to March '27, for the most part, those have all been already mitigated at a very early part of the FY '27 year. Right. So I'm going to hand over now to Christiaan Barnard, our Chief Financial Officer, to take us through the financial performance. Thank you very much.

Good morning, everyone. I promise I'll try and speak slower. Thank you, [indiscernible]. Again, our financial information are always -- it looks simplistic, but it is complex in nature. So we'll take you through highlights, but please send in questions, e-mail, and we will delve into the detail as needed. Looking at our income statement for the year, we grew our revenue to ZAR 840 million, excluding smoothing, which is 23.25% ahead of the prior financial year. On a like-for-like basis, that's 23.54%, but some interesting information about the like-for-like. Generally, like-for-like is defined by assets held at each financial period end. But in FY '25, we acquired certain assets from [indiscernible], which were only held for 4 months. So now that's 4 months compared to 12. So now if you only compare 12 to 12 months held assets, our like-for-like is still at 6.7% growth, which just shows you the strong performance of the core portfolio, strong escalations, low vacancy. So the core portfolio drives the business and allows us to make acquisitions and drive further growth in the portfolio. Now our NOI grew to 20.53% for the year. And as Quintin mentioned, our cost-to-income ratio is a total of just about 45% and operating costs just under 40% and admin costs just above 6%. Now as we are a growing business, there's always pre-implementation costs. So we are not afraid to perform at these numbers because we know there's staff we need to employ, there's costs we need offices are growing. All of these costs are pre-run acquisitions. So these costs will smooth line into the portfolio in the future as we continue to make acquisitions. And unfortunately, Kim is very busy because doing a lot of work to try and manage these costs. You will note that furthermore, our net interest for the year reduced by 7%. That is a result of interest rate reductions, but also continuously having improved margins in our debt portfolio. Now all of this performance resulted in an ICR of 4.34x, well above our covenant of 2x. Then looking at our BPR, the best practice recommendations. So we are very proud to announce that we have adopted the 2025 BPR, which was announced. It's not -- you do not have to elect and adopt it now, but we, as a business, believe in strong governance and a strong reporting, and we elected to adopt it. So all these motion financements are based on the new best practice regulations that is published on the SREIT website. As Quintin mentioned, ZAR 0.90 per share for the DIPS, applying a 95% payout ratio, giving us total dividend per share of ZAR 0.8616 per share. 95% payout ratio has been a consistent number for us over the past years and continue to be as we believe retaining that 5% is prudent for further uplift and improvement of the portfolio as our core portfolio continues to need repairs and maintenance, continues its capital improvement, and we do have sustainability projects we are underway to make sure our portfolio continues to perform at a strong and high level. Now one very interesting fact about the new BPR is that in the new regulations, depreciation allowances relating to assets is not allowed to be added back to increase your distributable income per share, a motto which Spear has followed since its inception at listing in 2016. We've continuously faced questions why don't you do that? Why don't you increase dividends, and we've stuck to our ground. And finally, it's written into the regulations that it's not allowed to be done, showing why we've done it because that depreciation relates to tenant allowances and commissions, which continuously needs to be incurred to ensure the portfolio is the highest possible occupancy that it can be. So we're very proud to report that numbers and show that we continuously are actually leaders in what the regulation should be. We will be declaring a ZAR 0.4457 final dividend for the year, which also we will be declaring a dividend reinvestment program as of this morning, which further details will be announced on SENS and as well as the circular being posted out later today. Then our balance sheet. It's always been simplistic, but now it's become more simplistic. We've done some cleanup in the financial year. As Quintin mentioned, ZAR 7.1 billion of assets. Our assets are investment property held for sale. We just announced the sale of [indiscernible], which Kim will delve into more detail. And the if you look on the right-hand side in our financial liabilities is now at zero. During the financial year, we had some free cash from operations. So we decided to settle all the solar finance lease liabilities. Those assets were running at IRRs of 18% to 24%. So it made 100% sense to settle all those liabilities and bring 100% ownership back to the company. All of this resulted in a tangible net asset value of ZAR 12.91, which grew from ZAR 12.20. Now these slides gives you a bit more detail on how our NAV grew from ZAR 12.20 to ZAR 12.91. During the financial year, a credible performance in our core portfolio as well as new acquisitions resulted in fair value adjustments, which resulted in a ZAR 1.11 increase in our TNAV for the year. The Section 42 acquisition had a very small decrease as we announced in since when we did the acquisition of Burg River Business Park. The capital raise we concluded of ZAR 749 million. We will never forget that ZAR 1 million that we didn't raise, as mentioned by many times, resulted in a very small decrease. At the end of the financial year, resulting in ZAR 12.91, showing once again how we continuously asset manage our portfolio to drive NAV growth for our shareholders. Now the bottom graph our LTV sensitivity. This is a very important graph. At period end, our LTV was at 22.94%, well below our covenant of 50% as set by the bank and even well more below the JSE requirement of 60%. Now these numbers we put out here is a 12- to 24-month bridge of what is to come, and what we are planning on doing. Now as a management team, we always -- we only put information in here, which we believe is highly likely to occur. So there's information we cannot yet fully give details to, but I mean we are working diligently to further grow the business. And with a 22.94% LTV, there's a lot of room for growth in this balance sheet in this portfolio. Just after year-end, we concluded a multiple oversubscribed capital raise, which reduced our LTV. We announced the acquisition of Watergate Retail Center. There's a couple of due diligence underway, which is keeping us very busy, and we will hopefully announce our interim results. We have final dividend to be paid, the disposal of Hamilton and Simi, which will reduce it and as well as [indiscernible] Park, which construction will begin in August, and we have the George. There's still some top structure works that needs to be started and civil works to be completed that coincide with the top structure as it goes on. Now concluding all of these transactions, if we conclude every single one of these actions as of today, our LTV will still only be 25.54%, meaning we are still well below our strategic band of 38% to 43%, just showing you how much room there is for growth in this portfolio. Our debt, here, we thank our valued partners and that always contributes towards our debt portfolio. Our total debt of ZAR 2 billion, of which 71% is fixed at an average cost of 8.75% at a weighted average expiry of 31 months. Variable debt at 29%, average all-in cost of 8.2% at an average expiry of 40 months. Now as we always explain to the market, the two charts in the middle and the right-hand side, these are the two. So your debt has variable debt, you then overlay fixed and swaps over your variable debt always. ZAR 2 billion is your net variable debt, of which ZAR 1.4 billion is fixed at rates. We have a robust maturity profile. You will see that we have no near-term refinance risk. The debt that is in short term has a term that's already been agreed, and we are busy drafting the legal agreements. So I see someone sitting here and needs to be working hard on those agreements. Then in terms of we refinanced just under ZAR 500 million of debt in the new financial year, of which one is a refinance of a standard linked loan. And then as Quintin mentioned, net of allocating capital, we have ZAR 382 million of cash reserves, net of all construction, development, portfolio improvement capital allocated. So we really have -- we are ready to grow. Balance sheet and funding update. This is just a confirmation of our covenants and that we are well, well below our LTV and well above our ICR. Then on the right, you will see the credible work that we've done in the current financial year to increase all the weighted average expiries and actually lower the average cost of resulting in higher dividends and more robust maturity profiles. And this is the slide you take a screenshot of and send to all your friends and to show the business how well we've done also for them to invest. This is a highlight of the majority of the financial information in the portfolio. This will give you the information that drives the decisions we make in the financial year, and what we've achieved in the financial year. So I will not delve into this. This is just for you guys to celebrate with us again. That is -- I didn't press any of those buttons. This thing is moving by itself. Why is doing it? Okay. ESG. Now in the last interim reporting, we obviously had a massive solar rollout and expansion portfolio. So in the last 6 months of the FY '26, a significant amount of work was done in the solar portfolio. Together with our installation partners, Emerging Energy and asset managers [indiscernible], we've managed to conclude all but 2 of our solar assets, one of which has been concluded after year-end, the other one which is in the planning and introduction phase. So at period end, we had 27 owned assets, 22 owned assets, 5 of which roof rentals, 2 CapEx projects, which one has been completed. We've taken the approach of now only developing our assets by ourselves and putting CapEx into it rather than having further roof rentals or finance leases because the returns are just so substantial in the portfolio, resulting as just 4% of total revenue in the past financial year, which we anticipate to grow to between 5% and 6% in the new financial year. Our penetration rate is at 24.01% at year-end, projected to grow to 26.98% in the new financial year. Our target in the near term is to achieve a 30% penetration rate. We believe that is a sustainable number as we do have very high power manufacturing properties, which requires power, which is practically impossible to provide high penetration rate because these tenants are very tech savvy. They are smart. Some of them produce at night, which we obviously can't provide solar then. They just have -- the demand of power is just too high that it doesn't matter how much roof space you have, you cannot implement enough solar for their power demand, but it also embeds them into your portfolios because we have the availability power coming into these parks that they require, which are very few of in the Western Cape. So as Quintin mentioned previously, ZAR 31 million revenue generated solar, which is projected to exceed ZAR 40 million in the new financial year, generating an NOI of ZAR 22 million, which equates to just about $0.05 in terms of actual DIPS for the portfolio. Then a sustainability update. I know it's very difficult to see on that picture, but the executives are among the very young students there. We all look the same and young and energetic. But this is something we are very and incredibly proud of. This business has grown to a point where we were able to launch a very first bursary program. We're sponsoring three very incredible and talented individuals for UCT studying the honors and property studies. We launched this program, and it was so fulfilling to hear the stories of these individuals. The study is ambitions, and we are looking forward to further actually sponsor more students in the near future. And as they conclude the studies, they will have the opportunity to do internships at Spear under the guidance of Kim being a registered property value, which they are studying towards and she will guide them into being the young and new professionals into the industry. We also have 2 student study -- internal students study accounting studies, which we sponsor. We have employees that are on 12-month managerial programs as well as starting providing support for a very individual from women's property network. So you can see we are very passionate about supporting the youth of South Africa and creating further development. And as this business grows, we hope that these numbers can only expand and more individuals can benefit from the Spear success story. Throughout the year, in terms of ESG and governance, we adopted [ King ] 5 fully into our integrated report, which will be released on the 29th of May. We adopted the SRE best practice of 2025 and into '26 announced numbers. We improved our BEE rating from Level 8 to Level 6, which we're very proud of as well as refinancing ZAR 230 million sustainable-linked loan through Standard Bank. Then on the right-hand side is some of the organizations that we support, and I highly recommend you look into these organizations and if you have some money in your hearts, spend it with them. They are doing incredible work, and we will continue to support them and continue to look for other charities that we can support throughout the financial year. I know it was fast, but we are running out of time. Kim?

Thanks very much, Christiaan. Good morning, everybody. I'm going to be taking you through our capital allocation and portfolio activity over the period, going to take you through acquisitions, disposals, then our property developments and finally, ending off with our property valuations. But before I get into the presentation, our capital allocation strategy remains disciplined and cycle aware. We continue to allocate capital into assets that we have conviction in the underlying node the income profile and importantly, our ability to enhance the value of the assets over time. At Spear, our strategy is straightforward: buying better, selling smarter and developing selectively. This approach continues to underpin not only the quality of our portfolio, but also the consistency of our income. That said, I'm going to move on to our acquisitions already concluded during the period. The three acquisitions that we concluded, firstly, we have Maynard Mall in Wynberg, Berg River Business Park in Paarl and Consani Industrial Park in Goodwood. Collectively, these acquisitions represent approximately ZAR 1.1 billion of strategic capital deployment into well-located, defensive, good quality Western Cape assets. I'm pleased to report that occupancies remain strong. Income performance is stable, and it's growing, and we're already seeing positive operational efficiencies across the assets as we integrate them into the Spear core portfolio. These acquisitions reinforce our industrial and our convenience retail positioning in line with our investment strategy. Moving on to our post year-end acquisitions and disposals. Post year-end, we were very excited to announce the acquisition of Watergate Shopping Center in Mitchells Plain. This is a dominant convenience retail asset, approximately 20,000 square meters. And as you can see from the image above, excellent quality, very well looked after property. It is anchored by a high-performing Shoprite and a bright hardware. Approximately 75% of the gross lettable area is underpinned by national tenants. We acquired Watergate Center in Mitchells Plain for ZAR 442 million at an initial yield from the date of transfer of approximately 8.4%. Importantly, while the lease expiry profile is relatively short, we view this as an opportunity rather than a concern. It gives us the ability to actively regear the income profile and potentially look at some tenant mix opportunities over the next few years through our hands-on leasing and asset management initiatives. Overall, Watergate is exactly the type of defensive cash-generative retail asset that we want to own in the Western Cape. This transaction is still subject to Competition Commission approval. We have -- our filing is already in. And all things being equal, we anticipate it will transfer around August this year. And then on to disposals. We haven't announced a disposal for some time. We've been very busy with our acquisitions. But last week, we announced the successful conclusion of Hamilton and Chiappini House. I can confirm these are not houses. As one of the articles did report last week, they are, in fact, commercial buildings. They formed part of the initial transaction we did with Emira, the 13 assets we acquired in October 2024. They're contiguous. You can see their commercial buildings with some retail at the bottom, and they're located in a very trendy area in Cape Town called De Waterkant. Now this is a node that is increasingly characterized by residential conversion activity. As such, we took the opportunity to strategically on sell these assets at a 33% premium to what we acquired them for. And this will result in generating a profit in excess of ZAR 26 million for Spear. This is a great example of how we continually look for opportunities to unlock value for shareholders. Moving on to our development growth. We continue to make disciplined progress across our development pipeline. Firstly, we have GTX Park in George. Now this is our development opportunity directly opposite the George Airport. We have now received our first approval to commence with a 5,000 square meter multi-let light industrial building. We always said we'd like to pre-let the space before commencing construction. However, we found that given the nature of the inquiries in George, which is typically between 500 and 1,000 square meters, these types of tenants like to commit between 3 and 6 months before taking occupation. Thus, we have, as an executive team, taken the decision to commence construction, and we're confident given the number of inquiries and the nature of inquiries that we will tie those leases up during the construction phase. And this is a very important milestone in establishing the precinct and marking the commencement of the first phase of GTX Park, which in total will be around 30,000 square meters of industrial. And then we have Bravo Park, which is the extension. You may remember, this is the opportunity at one of our existing facilities known as Bravo Park, where we can develop a 7,000 square meter warehouse. We knew it wouldn't be long before we secure a suitable tenant, which we have now done on a 10-year lease. The plans have been approved, and we expect construction to commence in August this year. And then last but not least, we have the Anchorage on Marine Drive in Paarden Island. This is our large-scale mixed-use development opportunity. The project is currently in its final stages of design, development and feasibility. We are making excellent progress, and we're actively engaging with a seasoned co-developer on this opportunity. But importantly, there remains no pressure on Spear to develop prematurely. Our rights are firmly in place. The property is completely and fully income producing, and we will only move forward when market conditions, the transaction structure and our co-developer or developers are appropriate, and it's in the best interest of Spear and our shareholders to do so. Across all of these developments, our approach remains disciplined, protecting the balance sheet and bringing the projects online at the right point in the development cycle. And finally, turning to property valuations. This is also one of my favorite areas of the business, and I really believe it is the core of the health of any REIT. I'm very pleased to announce we've seen another excellent result in our portfolio. Over the past six months, we've seen an uplift in our net asset value of ZAR 365 million, equating to around 5.42% in just six months. This growth is supported by strong underlying operational performance, together with something that I was very surprised to see the implementation of our solar across the portfolio has added really nice resilient additional income to our portfolio. And then, of course, the resilient property fundamentals in the Western Cape. You'll notice external valuations have increased to 96%. I think this may be one of the highest percentages we've had. I have been very busy. But it's also -- what it does do is it strengthens the independence. I don't want to say credibility because our numbers are very credible, but it strengthens the independence of our numbers. And then looking at the rate per square meter, per sector, you will notice that in each sector, there's a firming and especially in the industrial portfolio, again, it's certainly the star performing sector. Looking at the average value per property, you will notice that each of the sectors, we're well above our minimum investment threshold of ZAR 100 million per asset, which really does reinforce the institutional quality and the scale of our portfolio. As we always say, our approach is less is more. We prefer to own fewer assets, but assets of higher value. Looking at our valuation assumptions, as always, they remain conservative and broadly stable. Important to note, at Spear and for those of you who aren't familiar, we do not value any bulk in our portfolio. After the acquisition of Maynard Mall and Consani, we've increased that bulk. We have over 140,000 square meters of additional bulk, and that is not yet represented in these numbers, and it represents significant upside for our shareholders as and when we choose to develop the bulk. Overall, the portfolio remains appropriately valued and well positioned in key nodes in the Western Cape. In closing, from my side, the portfolio is in a strong position. Over the past year, we've improved quality. We've strengthened income. We've recycled capital effectively, and we've remained disciplined in how we allocate our capital. This positions Spear well for long-term continued growth without stretching the balance sheet or chasing risk. Thank you very much. I'll now hand over to Quinton, who will provide you with our guidance.

You very much, Christiaan and Kim. That was really well presented. Thank you. Right. So Spear is entering FY 2027 certainly from a position of strength, both operationally and financially. This is driven by the FY 2026 guidance outperformance, a declining cost of capital, a robust and growth-ready balance sheet. Spear's inclusion in the SA REIT Index and the -- all Property Index in March certainly will add to improved liquidity as well as the ongoing expansion of our investor universe. Our portfolio is, as Kim mentioned, quality and highly defensive. And the strategy is to maintain strong lease covenants and also a strong tenant base over this next year and into the long term. And we'll continue to grow the Western Cape portfolio in a consistent manner in key nodes that we've identified as growth nodes for the business. FY 2026, when you look at it in the rearview mirror and FY 2027 looking forward nicely out of the windshield, you'll see that the acquisitions will underpin income growth, earnings growth, subsector diversification and strong capital appreciation prospects. When we look at our growth pipeline, FY 2027 has really been a busy period for us. We do anticipate a growth pipeline of between ZAR 1 billion and ZAR 2 billion worth of yielding income-producing assets coming into the portfolio during FY 2027, which we are very excited about. But in addition to that, as Kim mentioned, about unlocking that value for shareholders, we anticipate about ZAR 140 million worth of high-quality industrial assets coming on stream into the portfolio, one of them being in George and GTX Park Phase 1 Building 1 and the other, the Blackheath Bravo Park expansion of the new modern distribution facility around -- which equates to around ZAR 90-odd million. We are very fortunate that we'll continue to operate in an area known as the Western Cape Advantage. We believe that the provincial economy will continue its outperformance as the strong economic fundamentals are maintained. The benefit of a lower unemployment rate and the higher rate of [indiscernible] will continue to also drive the investment case for us into other nodal opportunities. And then as always, we'll maintain a strategic focus. We'll remain long-term investors with a disciplined approach to investing. We don't suffer from [indiscernible]. We don't have to build a ZAR 20 billion business in a year. We'll build strategically, and we'll build with intention. And also, we'll build to create a business that actually can live to 100 years plus, which will outlive most of us in this room, possibly not our CFO. We'll continue to align with the provincial agenda, which is that of the Western Cape provincial government, the city of Cape Town and the many local authorities that we continue to invest into and work alongside, which really does create a very enabling environment for us to make capital allocation decisions in an area where you know that the infrastructure is there, the infrastructure is reliable and the infrastructure will continue to be looked after in the years coming. And lastly, we'll continue to deliver sustainable dividend growth and total returns to our shareholders on an annualized basis. Now every year, we set out key strategic priorities. This year will not be any different. In terms of FY 2027, we've set out six of them, and that's to unlock organic value within the portfolio through activation of embedded portfolio bulk which will again enhance shareholder NAV. We buy well and we develop high-quality assets within the core portfolio, unlocking that embedded bulk. There will be targeted asset growth. We'll pursue yield-enhancing acquisitions that yield to us ahead of our cost of capital. Our leasing performance will continue to strengthen that with a maniacal focus on reducing our vacancies on an ongoing basis. There'll be disciplined cost controls. We can grow our top line revenue as much as we want. But if we cannot control our costs, we're going to be going backwards, and that really is a key focus. We'll drive sustainable platform growth within our business through the strategic acquisitions, but also through an ongoing and authentic prioritization of our ESG strategy, and we'll continue to invest into best-in-class human capital. Now I mentioned earlier at the beginning, our smart strategy, and this really is our business in action, which is a consistent execution of the smart strategy, which is to specialize in the Western Cape. We have no desire to invest anywhere else. Our management will continue to be conducted internally where we can kind of feel the pulse of the business when it's racing and when it's not racing fast enough to do accretive acquisitions. There's no reason to just grow for the sake of growing unless we can grow meaningfully, to redevelop portfolio bulk and unlock NAV for shareholders and to timelessly execute on our early engagement leasing strategy, which has been a core hallmark of Spear since inception. Just having a look at our guidance. Based upon the information that we have available at this point in time, we anticipate to grow our distribution per share by between 6% and 8% for FY '27 compared to FY 2026. And subject to Board approval, we anticipate to maintain a payout ratio of 95%. Like most things in life, these are subject to qualifications. So please just familiarize yourself with that. It's not fine print. It's the same font, so it's easy and it's clear to read. Minimal load shedding during FY 2027. Our vacancies are reduced in line with management's forecast. Our lease renewals are conducted with -- in accordance with our projections. We've got no major tenant failures, which I'm pleased to say at this point in time, we don't foresee any. Tenants will continue to absorb increased cost of occupancy, which is becoming an important factor for every single tenant. Any shift in monetary policy will be able to be absorbed within the business, within our forecast for the year. And no civil unrest will occur in Cape Town, the Western Cape and South Africa. Thank you very much. That brings us to the end of our presentation. If you have any questions, please now will be a great time to ask them. So what we'll do is we'll maybe ask the questions that have come through on the website first, and then we'll go to any questions in the room. Thank you very much.

Question from Trinity at Anchor. Congratulations on the results. FY '27 DIPS guidance seems moderate. Could you provide some color on the key assumptions underpinning the equity guidance, specifically, does guidance model include any equity capital raises? To what extent does the guidance incorporate further acquisitions beyond already announced or acquired? I take it? So equity raises, we do include, but unfortunately, the equity raise we did do now in April was done after results were already in motion and in print. So those obviously will be the -- the impact of that capital raise we did in April will be further assumed and adjusted into our guidance we put out in either our Q1 update towards the end of June or in our interim results. And in terms of the acquisitions, acquisitions we never include into our guidance purely because the fact because there's one element we can't control, Competition Commission approval. Sometimes we get it quickly, sometimes it takes a lot longer than we anticipate. So it makes it difficult to include it in. We know what the numbers are, but when to include it into our results is the timing factor we need to be. So we want to be moderate and conservative and not announce it's going to transfer and then we have a 3-month delay, which we have seen happen before. So we don't want that to go into the market prematurely. [ Alistair ] Anderson from Property Flash. You speak of liquidity coming of age. Who is investing in Spear that hasn't before? Is greater liquidity attracting large institutions?

Yes. I think when we talk about like the investor universe expanding, for the longest time, Spear was not in any index, which meant that there were mandate restrictions placed on shareholders that could not invest into our business, many that wanted to, but just were precluded from doing that. So typically, we've seen many larger pension funds, both kind of public and private pension funds come into the register, which has certainly acted as a strong underpin to the growing business going forward.

Then a question from Peter [indiscernible]. Given the tight spread in the bond market, is there any appetite to launch a bond program?

Yes, there certainly is. At this point in time, we're working diligently with the financial institutions to investigate this. And if you don't believe me, one of them are here keeps presenting to us, you can ask them. But at this point in time, we believe we have to grow a little bit more. We have to free up some unencumbered assets, which we are working with the banks. So in time, yes, it will happen. But at this point in time, we believe it's anything from 12 to 24 months away from becoming a reality for Spear.

Another question from Peter. There are two net bank, Peter don't target me. There are two net bank facilities maturing in November. What are the value of these facilities, and what are the progress with regards to these refinancing? So value of those facilities in a gross basis is just under ZAR 500 million, and the terms have already been agreed. And as I mentioned, the legals are being drafted for refinancing. So it's basically being concluded already post year-end. Nothing further on e-mail. I'll check again at the end.

Do you have any questions from the floor? There is a mic. Do you want to maybe just grab the microphone there?

[indiscernible] just like to make a comment and maybe a question. Listening to your presentation today and observing the rise of your gross assets from ZAR 1 billion over the years to ZAR 7 billion now, yes, rightfully proud and your management should be very proud of you. Great progress. Looking at the future, I'm not sure I heard the answers clearly, but you raised ZAR 700 million this year. What dictates your pace of raising funds in the future. And having grown to ZAR 7 billion and knowing that you want to grow at least to ZAR 15 billion soon, what are the big challenges? I mean, for example, there are changes going on in property or interesting changes of data processing, the new airport in Durban. I know it's difficult to take advantage while you're trying to keep your yield as high as it is, but maybe you could make some comments.

Sure. Yes. So I think maybe on the first point, what has characterized our growth since inception is that we've always only raised what we needed. So when we did the raise in June, we raised ZAR 749 million. We had a clear strategy with that -- with those funds. And also, we were very specific as to at what rate we were willing to raise I think one of the hallmarks of this business also is that we don't get remunerated to grow. We actually get remunerated to grow in terms of asset base. We get remunerated to grow the income of the business. So in terms of a balance sheet prime for growth, we typically will bring acquisitions to a point where we know that we can kind of raise the equity. But it's never a case of just sitting back and thinking, well, listen, the ducks are quacking, we're going to just kind of throw equity at the market. We've been specifically very stingy with our equity. And again, just that flows into the type of credible, predictable and consistent results and operational management of the business we've done over the years. We've set specific targets in terms of FY 2027. And again, the capital we raised in April, again, is aligned with that kind of raise what we need, not necessarily just for the sake of raising because also, if you sit like right now, if we don't have a plan with that capital, we could be accused of having a bit of a lazy balance sheet. And we're also very sensitive to creating unnecessary cash drag on the income statement. So that does determine kind of -- and also the pricing. At the end of the day, when we are able to warehouse the cash for a period of time at a pretty much a neutral kind of cash management perspective, we'll do so. And then we'll deploy. As Christiaan said, the Competition Commission does add a layer of kind of complexity and delay to be able to deploy that capital. So we've got to be very careful in terms of what we raise and when we raise it. And then sorry, just on the second point, we're a REIT. So we plan on paying a dividend consistently every 6 months. So taking large land positions as an example, from what I kind of make from your question, isn't necessarily the type of staple that you'll find in our business. We've always said that 80% to 85% of the growth of this business will be driven by income-producing assets, acquiring industrial, commercial, convenience, retail, mixed-use opportunities that are yielding ahead of our cost of capital. We do take land positions in areas where, as an example, in George, you've got the -- it's the second fastest-growing city in the Western Cape. There's undersupply of high-quality industrial, and we were able to acquire the agricultural land and take it through the entire value-add process. But let me tell you that your kind of life cycle of development is infinitely longer versus in terms of getting it to a top structure. So therefore, smaller percentage of our business will be kind of organic led in terms of development growth versus acquiring investment grade and investment properties that are generating a yield from day 1 because development is risky. Landholding is risky. Things can change. Objections. -- you might find a frog that you never knew was there, which could delay your development 15 years. So these are also things that we have to do from a risk management perspective to ensure that our shareholders are protected from the downside risk of owning too much land. And equally, there's drag that gets created because the land isn't productive at a specific point in time. It takes quite a while to start generating cash flows. Any other questions? Okay. So we're standing between you and a cup of coffee and the photo wall.

One more from [ Allison. ] It's always a left field question. We can count on that. Are there any outstanding portfolios you would consider buying like the Emira one you acquired?

So the bottom line is that we're consistently looking at investment opportunities, whether it's a portfolio or a stand-alone, there's many things. You look at the -- if you just pay a bit of attention to the LTV bridge, you can see that there are some forthcoming attractions, but we don't want to score that for anybody. And we also don't want to get in trouble with the regulator. So you'll have to just watch this space and see how things develop. Thank you, everyone. Please join us...

Yes. Sorry, everyone. Sorry interruption. As you guys might not know, this is the 10th year of Spear being listed. 15 years ago, 3 individuals founded this business, and over the past 6 months, there's been a couple of people working very diligently hard to create a memorabilia piece for Mike Quint and Abu. Please bring it up for us. We work very hard to create a coffee table book for you guys. Included in this book, could you please come up here, please. Included in this book is messages from shareholders, friends, family, including every single asset you guys have transacted with, both acquired and bought with pictures, asset values, GLA, time line and history. And for all the staff and people, we can just say thank you.

Wow, thank you very much. Thank you very much. Yes. And also, Christiaan doesn't just work in subtractions. He also works in additions. So I also want to just congratulate Christiaan and [indiscernible], his beautiful wife also here. They'll be welcoming their second child in the next couple of months, and we also wish you all the best for that. Thank you, everyone. Please join us outside for a drink and a chat.