Listed property investment and development concern, Mashonaland Holdings (Masholds) reduced its loss to ZWL$124.4m in the six months to March 31, 2021 from ZWL$5.7bn reported in prior comparative period owing to revenue growth.
Revenue for the group jumped 46% to ZWL$149.4m in the reviewed period from ZWL$102.6m.
Masholds board chairperson, Grace Bema said revenue growth was driven by rental reviews.
“The revenue growth is mainly attributed to periodic rent reviews to hedge against the effects of inflation,” Bema said.
There was improvement from occupancy levels to 79.7% from 77.4% reported in the prior comparative period. This also contributed to revenue growth.
She said the company mainly relied on residential space as the central business district space demand weakened due to the effects of the Covid-19 pandemic.
However, Bema said Masholds remained resilient as rental increases hedged the company against the volatile environment.
Operating expenses shrank to 46% from 47% while operating profit increased 29% to ZWL$83m in the reviewed period from ZWL64m reported in the prior comparative period.
Bema said collections remained resilient at 94% from 91% achieved in the same period in 2020, despite the Covid-19 challenges.
The collaborative business relationships with tenants and a robust onboarding process, Bema said, continued to sustain collections.
The company, however, suffered a 2% portfolio value loss as of March 31 2021 in comparison with the inflation-adjusted valuation performed on open market value as at September 30, 2020.
The decrease in the portfolio value is a reflection that rentals remain below optimum levels due to depressed economic performance, Bema said.
This, according to Bema, presents an opportunity for the company to further align its rentals as the country’s economic forecasts improve.
The company experienced delays on the commencement of planned projects due to Covid-19 induced lockdowns.
Masholds has commenced the construction of 25 units in the Bluffhill housing project with the construction of a model show house, which is now complete and the preselling of the house has begun to manage the market risk.
The property company has also started disposing of 24 fully serviced stands in Ruwa following the issuance of the certificate of compliance by the Town Board.
The disposal of stands and other non-core assets is expected to improve the company’s liquidity to embark on its strategic developments.
Charter House reconfiguration works to a boutique hotel are now expected in the second half of 2021.
Bema said Masholds remained bullish to exploit the pockets of growth emerging in the market as the economy weathers the Covid-19 storm.
She anticipates space demand to go up following the 7.4% economic growth forecast this year.