Hyprop Investments (HYP) Trading update summary

Strategic and Operational Progress

• Portfolio repositioning prioritized dominant retail centers in South Africa and Eastern Europe, with asset recycling, the sale of non-core African assets, and the acquisition of Table Bay Mall, reducing risk and improving balance sheet metrics.

• Major upgrades, tenant mix improvements, and sustainability initiatives—including solar installations and full backup power—were implemented across key malls, enhancing amenities and reducing energy costs.

• Eastern Europe portfolio strengthened with upgrades, improved tenant mix, and dominant market positions, driving increased trading performance.

• Integration of Table Bay Mall and ongoing capital investment in property enhancements and leasing strategies support organic growth.

• Focus on recycling capital from Lango shares, potential asset sales in South Africa, and new growth opportunities in Eastern Europe.

Trading and Operational Metrics

• South African tenant turnover increased between 4.8% and 7.1% year-on-year, with trading density and footfall also rising; Eastern Europe tenant turnover grew between 10.4% and 11.5%.

• Positive rent reversions (up to 6.7%), high tenant retention (91.8%), and reduced vacancies, with retail vacancies at 2% in South Africa and 0.2% in Eastern Europe.

• Major projects include Somerset Mall expansion, Hyde Park Corner upgrades, and CapeGate precinct development.

• Cash collections remain robust at 99% in both regions, underpinning strong distributable income.

• Ongoing upgrades and sustainability initiatives, including solar, water, and accessibility improvements.

Financial Performance and Capital Management

• LTV reduced to 35.2% post-Africa asset sales, with ICR at 2.6x; LTV down from 52% over five years.

• 83% of interest rate exposure hedged; refinancing initiatives underway to extend maturities and reduce margins.

• Cash on hand at period end was ZAR 575 million, with ZAR 1.2 billion in available facilities.

• Consistent cash generation from operations exceeds distributable income, with a 116% cash flow to distributable income ratio in 2024.

• Dividend payout ratio at 75% for SA and Eastern Europe, with board reviewing potential progressive increases as risk profile improves.