Delta Property Fund has posted its half-year results for the six months ended 31^st August 2025, reporting a 71.86% increase in its profit from R29.5 million to R50.7 million, driven by its disposal programme, disciplined debt management, tight cost controls as well as successful lease renewals.

The REIT’s portfolio vacancies improved from 31.9% in FY2025 to 29.7%, supported by the disposal of non-core assets, as well as the contribution of newly secured leases.

A total of 43 leases, covering 47 943m² at a weighted average lease term of 1.5 years, were renewed during the period coupled with new leases for 14 674m² with a weighted average term of 1 year. Its portfolio vacancies (excluding non-core properties) held for sale improved to 18.7% during the period.

The Company achieved 100% collections of billings for the period versus 95.1% in FY2025.

“Although the B- and C-grade commercial office market remains exceptionally competitive, we are encouraged to see solid progress in executing our strategic priorities as part of Delta’s turn-around,” comments CEO, Bongi Masinga.

The Company transferred seven properties with a total GLA of 32 199m² for a gross consideration of R102.6 million. Post-period, an additional three properties with a combined GLA of 25 268m² were transferred for R130.8 million. In addition, four properties classified as held for sale, with a total GLA of 42 392m², are expected to transfer before the end of the current financial year, with anticipated gross proceeds of R130.8 million.

Net proceeds of R92.3 million from the disposals were paid directly to financial institutions and used to reduce its debt facility. In early November 2025, Delta also disposed of its entire holding of 14,869,210 shares in Grit, for 5.45 pence per share.

Cash generated from operations during the period amounted to R319.2 million, representing a 7.12% increase from R298.7 million in the previous half-year. Operational cash flow was allocated to finance costs of R201.3 million, taxation payments of R34.5 million, capex of R42.2 million, lease liability settlements of R2.6 million, and net debt repayments of R41 million.

The Company’s finance costs decreased from R237.4 million to R211.4 million, supported by interest rate cuts and ongoing capital repayment efforts with its weighted average cost of funding having improved to 10.5%, down from 11.4% in the prior comparative period.

Revenue decreased marginally by 0.9%, from R583.7 million to R578.2 million, primarily due to limited vacancies, rent reversions, and revenue impact from disposed assets while its South African REIT Funds from Operations (FFO) increased by 13.6% to R65.4 million from R57.6 million previously.

Capital repayments totalled R143.3 million (previously R139.8 million), comprising R92.2 million (previously R92.5 million) from property disposal proceeds and R51 million (previously R43.2 million) from amortization.

Delta’s covenant loan-to-value (LTV) ratio currently sits at 58.4% (February 2025: 59.5%) with a net asset value (NAV) per share of R3.50 (February 2025: R3.60).

Its Board resolved not to declare an interim dividend for the period ended 31 August 2025 (HY 2025: Nil).