Calgro M3 Holdings shareholders will undoubtedly be pleased with the 9.49 cents a share maiden annual dividend that the residential property and memorial parks developer has declared – the first in the 17 years that it has been listed on the JSE.
Adding further to shareholder value, there were share buybacks of 25.91 million shares at an average R2.92 per share. The group’s highest ever net asset value increased 40.60% to R13.37 a share.
CEO Wikus Lategan said in an interview they now had a dividend policy of 5% of headline earnings a share a year, so the maiden dividend was not a once-off.
He said it was good to be able to reward shareholders with a dividend, given some of them had stood by the group through thick and thin since its listing.
Lategan said they were in a position to be able to pay a dividend due to the focus on capital allocation. Seven of their nine projects were cash generative, and the positive outlook considering the project pipeline and that 90% of revenue of the past year was from the “the man in the street”.
The group handed over 1 794 units in the past year to February 29; 1 748 were under construction; while the development of another 1 100 were planned to start in a few months.
Lategan said their focus in the high interest rate environment was building in the under R500 000 per unit range, demand was healthy and the group had become adept in a much more technical and targeted marketing processes to sell the homes.
Post year-end, Calgro M3 Land and Eris Property purchased the Frankenwald property from the University of the Witwatersrand.
The land purchase on the doorstep of Sandton was expected to deliver 20 000 to 30 000 housing units alongside commercial, retail and industrial spaces.
Calgro M3 would do the residential development, while Eris would handle the commercial, industrial, educational, and healthcare components.
Calgro M3’s headline earnings a share increased 23% to 189.87 cents a share. Net debt to equity was stable at 0.63 (0.62). Loan to value was at 31.97% (31.04%).
Residential property development is the largest contributor to group performance. An increase in gross profit margin countered a decrease in revenue.
All nine active housing projects, mainly in Gauteng and the Western Cape, contributed to revenue and profitability. Products range from subsidised housing to premium homes above R3 million.
Lategan said the diversity helped them navigate economic and market conditions.
Revenue fell across the projects, but the segment gross profit improved to R330.63m or to 26.62% from 23.15%.
“These gains reflect our commitment to revenue diversification, ensuring stable customer hand-overs and consistent cash flow,” said Lategan.
In the first six months of the 2025 financial year, more than 2 970 opportunities were also being serviced.
Lategan said the major banks continued to support the industry by providing bonds, recognising the need for housing and its role in job creation and societal wellbeing, despite the tough market.
He said the Bankenveld District City would add at least R18 billion to the revenue pipeline over a 15 to 20-year period.
In the Memorial Parks segment, there was good growth following a 50.94% increase in gross profit, and a 40.7% rise in cash receipts.
A new memorial park was acquired in Rustenburg, adding some 25 533 burial opportunities to the pipeline. This additional memorial park was acquired but not yet transferred at the end of the financial year.
BUSINESS REPORT