Oryx Properties Ltd (ORY) released their FY21 results on 10 September 2021, reporting a N$10mn profit from prior year loss N$157.6mn, with total comprehensive loss reduced to N$32.1mn (PY: N$88.4mn loss).
Net rental income ↑0.4% YoY to N$227.5mn [3% higher than our expectation]. The vacancy factor reportedly ↑ to 5.9% (FY20: 5.4%) but excludes the commercial and residential rates of 11.2% (FY20: 9.3%). We believe this rate will remain under pressure as rent concessions, dragging along economy and ex ante 4th wave expectations linger on.
The distribution pay-out rate was momentarily reduced to 75% (Previously: 90%), including 2H21 distribution, and up to FY24. The final distribution of 43.25 cents, paid 15 Oct’21, brings the FY21 distribution to 99.75 (FY20: 69.75, FY19: 150) cents per share.
 In short, the 2H20 distribution, cancelled at the time, basically reduced, and deferred to FY21.
We do not foresee growth over the short-to-medium-term, alongside a reduced distribution and questionable portfolio valuation outlook. We downgrade our rating to a Sell (PY: Hold), with a target price of N$9.35 and a potential downside of 14.9%.
*The report is compiled by Simonis Storm
