FMP | Interim Condensed Consolidated Financial Statements for the period ended 30 June 2023

By Published On: September 20th, 2023Categories: Corporate announcement, Earnings


Overview of Operating Environment

The economy continues to be on a growth trajectory due to increased economic activity and monetary control measures to manage the inflationary pressures. The currency as at 30 June had stabilized following volatile periods experienced from May onwards, which evened out towards the end of June. The conflict between Russia and Ukraine has persisted, causing disruptions to supply chains. Consequently, imported products may face extended delivery times and increased costs, contingent upon the chosen supply routes.

During the period, the Zimbabwean Dollar experienced fluctuations against other currencies during the quarter leading to the half year with the exchange rate declining to US$1: ZWL5,739.7961 as at 30 June 2023 from US$1: ZWL2,577.0564 as at the end of May 2023. Efforts to halt the decline of the ZWL against major currencies have included the increased use of the ZWL for payment of taxes to Zimra and other state institutions, the introduction of virtual gold tokens and the introduction of the willing buyer and willing seller auction system to financial institutions for onward selling to companies and individuals.

The Reserve Bank of Zimbabwe’s continued tight monetary supply control has resulted in increased use of the multi currencies. This has also resulted in most tenants opting to pay for rentals in the United States Dollar currency whilst operating costs are mainly paid in the ZWL currency. Transactions in the local currency continue to be affected by the tight monetary control.

The blended year on year inflation rate for the month of June 2023 was at 175.75% up from the May 2023 rate of 86.54%. The month-on-month inflation rate was at 74.46% up from a figure of 15.74% as at May 2023. Main drivers have been the fluctuating exchange rate which has been driving the prices of goods and services.

Property Market Overview

The business continues to adapt to the dynamic changes in the demand for space in the right form, location and quality. CBD office space demand continued on a decline, largely driven by town planning schemes that are permitting retail and office space use and establishment along major arterial routes providing an alternative to tenants.

The property market continued to see rental payments in multi currencies with the majority of payments being done in the United States Dollar currency whilst operating costs are mainly in the ZWL currency. This is driven by the dual currency operating environment where continued reviews of rentals are key to drive the business growth strategic thrust.

The volatility in the local currency continues to negatively affect the number of developments on the market. There has been increased expenditure on public infrastructure and the expansion of this is expected to have an impact on increasing developmental activity on the market. Access to long term liquidity is key to increased property development through allowing cost effective development funding. Residential, retail, Industrial and space repurposing developments continue to lead the development space.

Business performance overview

The Group’s inflation adjusted Net Property Income increased by 10% to ZWL1.333 billion (HY 2022: ZWL1.213 billion) together with growth in inflation adjusted revenue of 119% to ZWL8,026 billion (HY 2022: ZWL3.661 billion). Rental income remains the main source of revenue. In historical terms, revenue grew by 657% from ZWL486 million in June 2022 to ZWL3.676 billion mainly due to timeous rental reviews and stable occupancy level averaged 88.10% for the 6 months ending 30 June 2023 (FY 2022: 85.52%).

Management continued to engage the tenants for timeous rental reviews and payments. This initiative resulted in the marginal drop on the number of defaulting tenants who in the past deliberately delayed to meet their lease obligations leading to improved collection rate at 87% (FY 2022: 86%). Demonstrating the Company’s commitment to providing a quality and safe product (property) to its tenants, ZWL 404.2 million and ZWL 44.3 million were committed towards maintenance and improvements respectively during the period under review.

Property valuations

An independent property valuation conducted by Knight Frank Zimbabwe as at 30 June 2023 valued the property portfolio at ZWL 853.85 billion (FY 2022: ZWL 109.37 billion). The growth in property values of 679% was driven by the growth in rentals consistent with the inflationary environment.


The Group has strategically positioned itself to generate shareholder value through the pursuit of a range of projects which are currently at varying stages of execution.

The Arundel Office Park extension, which entails the construction of a double storey office building with a basement and a lettable area of 2,616.50 square metres is progressing well. To date, the roof slab concreting are complete. Overall total project progress stands at 60% at reporting date.

In Chinhoyi, construction of a four-storey student accommodation building is also advancing well with most of the structures now at second floor level. This project, which has a prescribed asset status is being implemented in partnership with institutional investors.

The business is a co-investor in the development of mixed-use duplex clusters, three to four storey flats and student hostels in Zvishavane with the proposed designs having been approved by Zvishavane Town Council. The contractor commenced work on site with Phase A comprising the Six Duplex Flats while other 20 blocks of Double and Triple Storey Flats are at trenching and brick footing levels.


The Group will continue to run its operations sustainably in line with the environmental, social and governance (ESG) requirements. The adoption of “green” operations including investing in a solar power plant, energy efficient operations and waste management initiatives remain key to the Group’s strategy. We will continue to enhance the Group’s ESG framework in line with the global trends.


At a meeting held on 29 August 2023, your Board resolved that a second interim dividend of ZWL 375,1 million being ZWL 30,34 cents per share and USD 130,250 being USD 0.011 cents per share be declared from the profits for the second quarter ended 30 June 2023. The dividend will be payable on or about 27 October 2023 to all shareholders of the Group registered at close of business on 6 October 2023. The shares of the Group will be traded cum-dividend on the Zimbabwe Stock Exchange up to 3 October 2023 and ex-dividend as from 4 October 2023.

Business Outlook

Despite the ongoing uncertainty, the business will not deviate from it’s growth strategies that are aimed at increasing shareholder value. This includes investing in lucrative properties that can serve as a safeguard against inflation and exchange rate risks. Additionally, the business will prioritise maintaining high occupancy levels by effectively managing client relationships and offering quality and secure products through continuous property refurbishment, maintenance, and upgrades.


The staff and management team of First Mutual Properties continue to furnish a favorable outturn despite an uncertain operating environment. I commend them for their continued efforts.

On behalf of the board, I would also like to convey gratitude to all the key stakeholders and my fellow board members for all their support.

Elisha K. Moyo
Chairman of the board
29 August 2023

FMP – Interim Condensed Consolidated Financial Statements for the period ended 30 June 2023.pdf

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