Kingston Properties Limited (KPREIT)
For the Six Months ended June 30, 2017:
Kingston Properties Limited reported Rental Income of $101.08 million, 59% more than the $63.73 million reported for 2016. Property management fee of $5.97 million was reported for 2017 relative to none reported in 2016. There was no Other Income reported in 2017 and according to the company “In the 2016 review period, one of our tenants opted to terminate their lease prematurely and was subjected to an early termination fee of approximately $12.2 million pursuant to the terms of the lease”.
This resulted in a 41% increase in total revenues year over year to $107.05 million relative to $75.92 million reported the prior year. For the quarter the company reported total revenue of $51.98 million relative to (2016: $45.22 million).
Operating expenses which consist of ‘direct property expenses’ and administrative expenses’ grew by 28% to $62.10 million relative to the $48.55 million posted for the same period last year.
As such, Results of Operating activities before other gains amounted to $44.95 million, a 64% increase when compared to the $27.37 million posted last year.
Miscellaneous Income amounted to $146,000 (2016: $1.02 million).
Operating profit closed the period at $45.10 million, this compares with the $145.28 million booked a year ago. This was due to $116.89 million reported as Fair value Gain on Investment in the 2016 period.
Net finance costs closed at $19.44 million relative to Net finance income of $15.56 million for the 2016 period. This led to a Profit before taxation of $25.66 million, compared to the Profit of $160.84 million the corresponding 2016 period.
Taxes amounted to $4.87 million were recorded for the period, resulting in Net Profit of $20.79 million relative to Net Profit of $117.05 million in the comparable period last year an 82% decline. For the quarter the company recorded profit of $19.74 million relative to $26.75 million reported in 2016.
Earnings per share amounted to $0.065 for the period relative to earnings per share of $0.36 in 2016. While earnings per share for the quarter amounted to $0.061 relative to earnings per share of $0.08 in 2016. The twelve month trailing EPS amounted to $0.105. The number of shares used in our calculations is 321,992,668.
Balance Sheet at a glance:-
As June 30, 2017, assets totaled $2.60 billion, $433.74 million more than the $2.16 billion booked as at June 30, 2016. The company stated that “Investment Properties remain the largest component of Kingston Properties’ balance sheet assets. As at June 30, 2017, investment properties amounted to $2,507.7 million versus $1,912.5 million at the end of the second half of 2016. The increase is primarily as a result of additions to the portfolio during January 2017 and this represents a year over year increase of 31.1%. In 2017, the portfolio composition by geography is as follows: US (53%), Jamaica (34%) and Cayman (13%). This compares with US (70%) and Jamaica (30%) in 201”
Shareholder equity closed at $1.72 billion, up $2.24 million from last year, resulting in book value per share of $5.334 (2016: $5.328).
Total liabilities were $880.17 million as at June 30, 2017 compared to $448.67 million as at June 30, 2016. This was mainly due to a 115% increase in non–current liabilities totalling $817.53 million, which was $436.97 million more than reported in 2016. According to the company “The loans are part of the Group’s strategy to increase leverage within prudent limits secured by properties to bolster the expansion of the property portfolio”.
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