May 13 2024 19:30
Integrated housing developer Calgro M3 saw its shares climb 7% to R5.75 on Monday, as the group which had been seen a darling capital growth investment some years back before running into numerous challenges, declared a maiden dividend of 9.49350 cents per share. This was off the back of Calgro M3’s financial results for the year to end-February 2024.
The group’s headline earnings per share (HEPS) for the reporting period increased to 189.87 cents from 153.18 cents a year ago. Revenue fell to R1.28bn from R1.53bn, but profit after tax rose to R196.8m from R186.3m.
Calgro M3 also achieved its highest ever net asset value (NAV) per share increasing 40.60% to R13.37 compared with R9.51 at the end of February 2023. This was with assets valued at the lowest or cost or net realisable value.
As many as 1794 units were handed over in the current year, with 1748 units under construction. Calgro had plans to develop another 1100 units but on a staggered basis. Residential property makes the vast majority of its revenue each financial year. However, the group is also managing a memorial parks business.
Calgro M3 has nine active projects which are mostly located in Gauteng and the Western Cape. All contributed to revenue and profitability during the reporting period.
“The 2024 financial year experienced a decrease in revenue across our projects. The overall segment gross profit improved to R330.63m or 26.62%, a noteworthy increase from the previous year’s 23.15%,” Calgro said in a statement.
Calgro M3 earned revenue of R1.3bn in the reporting period compared with R1.5bn in the 2023 financial year.
“We have also made commendable progress in increasing other income, achieving a 28% increase due to higher bond commissions ascribable to the focus on open market housing. These gains reflect our commitment to revenue diversification, ensuring stable customer handovers and consistent cash flow,” Calgro CEO Wikus Lategan said.
Bankenveld District City, announced last month, would at minimum add R18bn to the revenue pipeline through the delivery of between 20,000 and 30,0000 opportunities over a 15 to 20-year period.
The project is expected to change Johannesburg’s northern suburbs by adding up to 30,000 housing units in the area, he said.
“It is estimated to double our project pipeline with anticipated revenue in excess of R18bn, heralding socioeconomic upliftment and a focus on sustainable living standards,” he said.
Its memorial parks division saw significant growth, with a 50.94% increase in gross profit but also a significant increase in cash receipts of 40.7%, reaching the highest cash collections since the segment’s formation in 2017.
The group has acquired a new memorial park in Rustenburg, adding about 25,533 burial opportunities to the pipeline. This additional memorial park was acquired but not yet transferred within the 2024 financial year.
alistair@propertyflash.co.za
