Force majeure at coal exporters
• Share price falls 10.53% on Friday
SA’s largest coal exporters have declared force majeure after Richards Bay Coal Terminal took the step in response to the nationwide lockdown.
Debt-laden shopping mall owner Rebosis is getting a helping hand from creditors as the nationwide lockdown puts strain on its rental income.
The company, which is headed by founder CEO Sisa Ngebulana, said on Friday that lenders had agreed to extend maturities on expiring debt until the end of August, giving it a brief reprieve with smaller tenants at its shopping malls having closed their doors for three weeks to comply with the restrictions.
“The company has successfully managed to extend all expiring debt facilities to the end of August 2020, and continues to meet its financial obligations in the normal course of business in the current known circumstances,” the company said in a statement on Friday.
Rebosis, with a property portfolio worth R15.6bn, is labouring under a R10bn debt burden that has pushed up its loan-to-value ratio — a ratio watched by lenders which weighs debt relative to the value of the portfolio — to about 65%, well above the maximum of 40% demanded by fund managers.
The company said it had not worked out the effects of the lockdown, which started on Friday, on its finances, and it may have to delay its half-year financial results, due to be published on May 25. For the duration of the nationwide lockdown, many of Rebosis’s tenants that are medium and small businesses have had to shut their doors, slashing their cash flows and potentially triggering a fight for survival.
This piles further pressure on the company, which is struggling to get tenants to agree to rental increases on new leases.
Rebosis and other listed property funds are trying to manage tenants in SA’s worst economic conditions in decades as customers spend less and few firms expand local operations.
The price of Rebosis’s ordinary shares fell 10.53% to 17c on Friday, bringing the reduction so far this year to 50% The share price has fallen 98.7% over the past three years.
The company sold its stake in New Frontier last year for the equivalent of R700, after it had lost more than R2bn on the investment.
Brexit uncertainty led to a writedown of commercial property values in Britain.
The FTSE/SE SA Listed Property Index closed 7.5% lower on Friday, down more than 50.1% over the year to date.
THE COMPANY HAS SUCCESSFULLY MANAGED TO EXTEND ALL EXPIRING DEBT FACILITIES TO THE END OF AUGUST 2020