HARARE March 24 (The Source) – Zimre Property Investments (ZPI) reported a 600 percent fall in after tax profit to $253,000 for the full year to December on rising voids and a fall in demand for real estate, a symptom of an underperforming economy.
Portfolio voids went up to 19 percent from 14 percent in 2013.
The company on Tuesday announced that it experienced an increase in voluntary lease surrenders which contributed to the rise in both portfolio voids and debtors resulting in rental income going down seven percent to $3, 6 million from $3,9 million in 2013.
Total revenue for the year was $5, 7 million marking a 15 percent decline from the $6, 7 million achieved in 2013.
ZPI chairman Buzwani Mothobi said the economic environment remained challenging with property values likely to remain depressed.
“It is unlikely that the industry capacity utilization will increase anytime soon, thereby reducing demand for space and inhibiting any upward movement in rentals. Therefore development projects shall be exploited to enhance performance of the company,” he said.
Operating profit was 44 percent lower at $1, 1 million compared to nearly $2 million recorded the previous year.
Average portfolio rentals were $6, 59 per square meter down from $9, 16 per square meter in the prior year.
Projects income for the year amounted to $2 million down from $2,8 million achieved in the prior year .
Administration costs increased to $ 2, 9 million compared to $2, 5 million in the previous year.