Collins Property Group HEPS up 27.1% on asset sales
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Collins Property Group HEPS up 27.1% on asset sales. Headline earnings per share rose 27.1% to 75 cents for the six months to August 2026, as the real estate investment trust pressed ahead with selling assets to cut debt. Basic earnings per share climbed 36.8% to 78 cents, and net profit attributable to ordinary shareholders rose 15.6% to R252.16 million. The board declared an interim dividend of 55 cents per share, up 5.8%. Revenue, excluding straight-line rental income, fell 2.2% to R611.05 million, a decline the company says matched expectations given its disposal strategy. Collins sold R342 million in investment properties during the period, with a further R913 million now unconditional and R1.035 billion still being negotiated. One property sold for R285.5 million at auction. The loan-to-value ratio stood at 49% at the end of August 2026. Vacancies across the portfolio held at 1.6%, while the income collection rate improved to 100% from 99%. The weighted average lease expiry shortened to 3.6 years from 4.2 years. Read the full story by Neale Petersen on rei.co.za.
Collins Property Group's headline earnings per share (HEPS) rose 27.1% to 75 cents for the six months to August 2026, as the REIT pressed ahead with asset disposals to cut debt.
- Collins Property Group's HEPS rose 27.1% to 75 cents, while its interim dividend increased 5.8% to 55 cents.
- The REIT sold R342 million in investment properties in the period, with a further R913 million in sales now unconditional.
- Logistics and industrial assets, 86% of the portfolio, kept vacancies at 1.6% even as Collins cut its loan-to-value ratio to 49%.
Earnings and dividend climb despite revenue dip
Collins Property Group, a South African real estate investment trust (REIT) concentrated in logistics, industrial and convenience retail, reported headline earnings per share of 75 cents for the six months ended August 2026, according to the company's unaudited consolidated financial results released on Friday. That is up 27.1% from 59 cents in the corresponding period last year.
Basic earnings per share rose 36.8% to 78 cents from 57 cents, while net profit attributable to ordinary shareholders increased 15.6% to R252.16 million from R218.09 million. Distributable income rose to R210.1 million from R206.8 million, lifting distributable income per share to 64 cents from 63 cents. The board declared an interim dividend of 55 cents per ordinary share, up 5.8% from 52 cents a year earlier.
The dividend increase lagged well behind the growth in HEPS, a gap that reflects how much of the group's improved earnings are being weighed against its ongoing property disposal programme.
Revenue falls as disposal strategy continues
Revenue, excluding straight-line rental income, declined 2.2% to R611.05 million from R624.98 million. Collins said the drop matched expectations, since its strategy of disposing of investment properties to bring down the loan-to-value (LTV) ratio was always going to weigh on revenue.
Total assets fell to R12.8 billion from R13.4 billion, which the company attributes to the disposal of investment properties over the period.
Property sales accelerate loan reduction
During the six months, Collins sold investment properties worth R342 million. A further R913 million in sales had become unconditional, while transactions worth R1.035 billion were in the final stages of negotiation, the company said.
One property fetched R285.5 million at auction, a result the company said no other South African property auction sale had surpassed.
The group's LTV ratio, calculated under the South African REIT Best Practice recommendations, stood at 49% at the end of August 2026. Collins also reported progress in negotiating improved borrowing terms: during the financial year's first half, it lowered the margin charged on 47% of its debt by 90 basis points.
Portfolio metrics hold steady
Vacancies across the portfolio held at 1.6%, unchanged from the previous corresponding period, while the income collection rate improved to 100% from 99%.
The weighted average lease expiry (WALE), measured by income, shortened to 3.6 years from 4.2 years. The group's all-in cost-to-income ratio stood at 21%.
Logistics, industrial and convenience retail assets make up about 86% of the portfolio by value, concentrated in major metropolitan areas across Southern Africa, with the remaining 14% located in Western Europe.
What this means for property investors
For REIT investors tracking the diversified and industrial segment through this earnings season, Collins' unchanged low vacancy rate and improved collection rate point to resilient underlying tenant demand, even as the group actively reshapes its balance sheet.
But the shorter WALE and the wide gap between HEPS growth and dividend growth are worth watching. A falling WALE of this kind can point to more near-term leasing risk if tenants do not renew on similar terms, and the 49% LTV shows a group still working to bring down leverage even after a round of disposals.
The pace at which the R913 million in unconditional sales and the R1.035 billion still under negotiation are completed will determine how much further leverage falls, and how much more revenue may decline as income-producing assets leave the portfolio.
The investment takeaway
Collins Property Group's half-year numbers show earnings and distributable income growing even as the REIT trims its balance sheet, evidence that its remaining logistics, industrial and convenience retail assets are performing on key metrics such as vacancy and collections.
The next test will be whether the R913 million in unconditional sales and the R1.035 billion still under negotiation complete as planned, and whether Collins can hold its vacancy rate and collection levels while its loan-to-value ratio keeps moving lower.
Sources: SENS; Collins property group REIT results
