Resilient REIT : Unaudited consolidated financial results for the six months ended 30 June 2022 and changes to the board

Resilient	REIT Limited
Incorporated	in the	Republic of South Africa
Registration	number: 2002/016851/06
JSE share	code: RES	ISIN: ZAE000209557
Bond company	code: BIRPIF LEI: 378900F37FF47D486C58
(Approved	as	a REIT	by the JSE)
("Resilient"	or "the Company" or "the Group")

Short-form announcement: Unaudited consolidated financial results for the six months ended 30 June 2022 and changes to the Board

Nature of the business

Resilient is a retail-focused Real Estate Investment Trust ("REIT") listed on the JSE Limited ("JSE"). Its strategy is to invest in dominant retail centres with a minimum of three anchor tenants and let predominantly to national retailers. A core competency is its strong development skills which support new developments and the reconfiguration of existing shopping centres to adapt to structural changes in the market. Resilient also invests directly and indirectly in offshore property assets.

The Company's focus is on regions with strong economic fundamentals, either with mineral resources or export quality agricultural products. Resilient generally has the dominant offering in its target markets with a strong grocery and convenience offering.

Distributable earnings and dividend declared

The Board has declared a dividend of 234,05 cents per share for the six months ended June 2022. This represents an increase of 3,5% compared to the dividend of 226,11 cents per share for the six months ended June 2021 ("comparable dividend").

Resilient distributed 170 554 201 Lighthouse shares to its shareholders in May 2022. As such, no dividends from these shares were included in distributable earnings for this interim period. Had Resilient retained these shares, the interim dividend would have been 10,2% higher than the comparable dividend.

Commentary on results

The COVID-19 pandemic no longer has a significant impact on the Group's shopping centres and no further discounts were provided to leisure-focused tenants. New rental agreements (base rental plus a turnover clause) have been agreed with Ster-Kinekor. A similar arrangement has been proposed to NuMetro. Following the release of a number of "blockbuster" films, the performance of the cinemas has been encouraging.

Resilient continues to engage with SASRIA. The only outstanding insurance claim regarding damages and expenses suffered during the riots of July 2021 amounts to approximately R1,3 million. This amount was not accrued for in this interim period.

Resilient's portfolio achieved strong comparable sales growth of +9,9% for the six months ended June 2022 compared to the six months ended June 2021 (+16,6% compared to the six months ended June 2019 pre-COVID performance).

Resilient continues to actively address the structural changes in the retail environment, in particular the downsizing of department stores and increasing the grocery offering. Four additional full-offering grocery stores and a Food Lover's Market are being introduced.

The South African property portfolio recorded comparable net property income growth of 7,7% for the reporting period (excluding COVID-19 rental discounts granted in the comparable period).

Resilient owns 27 retail centres in South Africa with a gross lettable area of 1,2 million square metres. Resilient's pro rata share of the vacancy in the portfolio was 2,0% at June 2022. This includes space held vacant to

accommodate the new grocery stores.
Financial performance	Unaudited	Restated
	for the	for the
	six months	six months
	ended	ended
IFRS information	Jun 2022	Dec 2021	Movement
Total revenue (R'000)*	1 536 595	1 539 748	(3 153)
Basic earnings per share (cents)*	484,90	511,06	(26,16)
Diluted earnings per share (cents)*	483,11	509,52	(26,41)
Headline earnings per share (cents)*	220,82	217,06	3,76
Diluted headline earnings per share
(cents)*	220,01	216,41	3,60
Dividend (cents per share)	234,05	226,62	7,43
Net asset value per share (R)**	54,16	56,58	(2,42)
Management account information
Net asset value per share (R)	58,23**	64,96	(6,73)
Loan-to-value ratio (%)	32,1	28,8	3,3
Gross property expense ratio (%)	35,0	38,1	(3,1)
Percentage of direct and indirect
property assets offshore (%)	21,3	29,3	(8,0)

• Represents continuing operations. The Nigerian operations are classified as discontinued operations at the reporting date.
• The net asset value per share at June 2022 would have been R3,34 higher if Resilient retained the 170 554 201 Lighthouse shares it distributed to its shareholders in May 2022.

Changes to the Board and sub-committees

Shareholders and noteholders are referred to the SENS announcement of 20 June 2022 regarding the passing of David Brown on 19 June 2022.

Thembi Chagonda formally retired from the Board and her positions as chairperson of the Social and Ethics Committee and member of the Nomination Committee at the annual general meeting of 22 June 2022. As a consequence, changes to the sub-committees were announced on SENS on 22 June 2022.

Shareholder engagement

Resilient's property portfolio appeals to investors seeking predictable and sustainable cash flows from real estate exposure without volatility in capital value. Reflecting global trends, it is no longer a given that a JSE-listing enhances access to capital, particularly for a property company such as Resilient. With its advisors, Resilient is evaluating its listing on the JSE and all alternatives, with the objective of maintaining high standards of governance and reporting, but with greater efficiency and focus on investor interests, with a view to reducing volatility for investors. Resilient now intends to engage with its shareholders

and to take their views into account in its evaluations.

Prospects

Resilient's properties continue to perform strongly. Substantial progress has been achieved in addressing the structural challenges of department stores. The introduction of additional grocers will further increase the dominance of the Group's properties. These initiatives are yield-dilutionary, however, are partially offset by increased solar capacity which is yield-accretive.

The Board intends to resume providing distribution guidance in 2023.

Payment of interim dividend

The Board has approved and notice is hereby given of an interim dividend of 234,05000 cents per share for the six months ended 30 June 2022.

The dividend is payable to Resilient shareholders in accordance with the

timetable	set out below:
Last date	to	trade cum dividend	Tuesday, 6	September 2022
Shares	trade	ex dividend	Wednesday, 7	September 2022
Record	date		Friday, 9	September	2022
Payment date		Monday, 12	September	2022

Share certificates may not be dematerialised or rematerialised between Wednesday, 7 September 2022 and Friday, 9 September 2022, both days inclusive.

In respect of dematerialised shareholders, the dividend will be transferred to the Central Securities Depository Participant ("CSDP") accounts/broker accounts on Monday, 12 September 2022. Certificated shareholders' dividend payments will be posted on or about Monday, 12 September 2022.

This short-form announcement is the responsibility of the directors and is only a summary of the information in the full announcement and does not include full or complete details. The information regarding the tax treatment of the dividend is included in the full announcement. The full announcement has been released on SENS and is available on the JSE website at https://senspdf.jse.co.za/documents/2022/JSE/isse/RESE/HYJun22.pdf, and on the Company's website at www.resilient.co.za. The full announcement is available for inspection at the registered offices of the Company or its sponsor, at no charge, during office hours. Any investment decision should be based on the full announcement available on the Company's website.

By	order of the	Board
Des de Beer		Monica Muller
Chief executive	officer	Chief financial officer
12	August 2022

Dividend tax treatment

In accordance with Resilient's status as a REIT, shareholders are advised that the dividend of 234,05000 cents per share for the six months ended 30 June 2022 ("the dividend") meets the requirements of a "qualifying distribution" for the purposes of section 25BB of the Income Tax Act, 58 of 1962 ("Income Tax Act"). The dividend will be deemed to be a dividend, for South African tax purposes, in terms of section 25BB of the Income Tax Act.

The dividend received by or accrued to South African tax residents must be included in the gross income of such shareholders and will not be exempt from income tax (in terms of the exclusion to the general dividend exemption, contained in paragraph (aa) of section 10(1)(k)(i) of the Income Tax Act) because it is a dividend distributed by a REIT. This dividend is, however, exempt from dividend withholding tax in the hands of South African tax resident shareholders, provided that the South African resident shareholders provide the following forms to their CSDP or broker, as the case may be, in respect of uncertificated shares, or the Company, in respect of certificated shares:

1. a declaration that the dividend is exempt from dividends tax; and
2. a written undertaking to inform the CSDP, broker or the Company, as the case may be, should the circumstances affecting the exemption change or the beneficial owner ceases to be the beneficial owner,

both in the form prescribed by the Commissioner for the South African Revenue Service. Shareholders are advised to contact their CSDP, broker or the Company, as the case may be, to arrange for the above-mentioned documents to be submitted prior to payment of the dividend, if such documents have not already been submitted.

Dividends received by non-resident shareholders will not be taxable as income and instead will be treated as an ordinary dividend which is exempt from income tax in terms of the general dividend exemption in section 10(1)(k)(i) of the Income Tax Act. Any distribution received by a non-resident from a REIT will be subject to dividend withholding tax at 20%, unless the rate is reduced in terms

of any applicable agreement for the avoidance of double taxation ("DTA") between South Africa and the country of residence of the shareholder. Assuming dividend withholding tax will be withheld at a rate of 20%, the net dividend amount due to non-resident shareholders is 187,24000 cents per share.

A reduced dividend withholding rate in terms of the applicable DTA may only be relied on if the non-resident shareholder has provided the following forms to their CSDP or broker, as the case may be, in respect of uncertificated shares, or the Company, in respect of certificated shares:

1. a declaration that the dividend is subject to a reduced rate as a result of the application of a DTA; and
2. a written undertaking to inform their CSDP, broker or the Company, as the case may be, should the circumstances affecting the reduced rate change or the beneficial owner ceases to be the beneficial owner,

both in the form prescribed by the Commissioner for the South African Revenue Service. Non-resident shareholders are advised to contact their CSDP, broker or the Company, as the case may be, to arrange for the above-mentioned documents to be submitted prior to payment of the dividend if such documents have not already been submitted, if applicable.

Shares in issue at the date of declaration of this dividend: 375 521 874

Resilient's income tax reference number: 9579269144

Directors

Alan Olivier (chairman); Stuart Bird; Des de Beer*; Des Gordon;

Nick Hanekom*; Johann Kriek*; Dawn Marole; Monica Muller*; Protas Phili; Thando Sishuba; Barry van Wyk

(* executive director)

Company secretary

Hluke Mthombeni CA(SA)

Registered address

4th Floor, Rivonia Village, Rivonia Boulevard, Rivonia, 2191

Transfer secretaries

JSE Investor Services Proprietary Limited

13th Floor, 19 Ameshoff Street, Braamfontein, 2001

Sponsor

Java Capital Trustees and Sponsors Proprietary Limited 6th Floor, 1 Park Lane, Wierda Valley, Sandton, 2196

Debt sponsor

Rand Merchant Bank (a division of FirstRand Bank Limited)

1 Merchant Place, corner of Fredman Drive and Rivonia Road, Sandton, 2196 www.resilient.co.za