Mashonaland Holdings (Zimbabwe) revenue soars by 80% to ZW$561 million for the 15 months to Dec. ’21

By Published On: April 13th, 2022Categories: Corporate announcement, Earnings

Mashonaland Holdings Limited ( FY2021 Abridged Report


I am pleased to present the Mashonaland Holdings Limited condensed consolidated inflation adjusted financial results for the 15-months period ended 31 December 2021.

Operating environment

The Zimbabwean socio-economic environment remains depressed despite the easing of COVID-19 restrictions following a slowdown in the rate of infections in the second half of the year. The local currency depreciated by 33% on the Reserve Bank of Zimbabwe (RBZ) foreign exchange market and by over 90% on the parallel market over the course of the reporting period. The significant local currency depreciation resulted in sustained cost pressures despite the easing of inflation from 659.4% per annum in September 2020 to 60.7% per annum in December 2021. The market continues to witness marked disparities in the pricing of goods and services depending on the currency of settlement.

Property market

Demand for commercial space remains weak resulting in rentals declining in real terms and high void levels especially within the commercial CBD sub-sector. Whilst demand for residential properties remains relatively high, the falling disposable incomes has held back rental growth. The property investment sub-market remains depressed. Economic uncertainty has largely distorted valuations making it difficult to objectively appraise new investments. Faced with high inflation levels, of cost-push in nature, the property asset class has struggled to live to its inflation hedging attribute. Whilst strategically located and Grade A assets were able to hedge against inflation, rental growth in other subsectors could not keep up with the cost-push inflation trends. The development submarket has been the most affected over the trading period as construction costs remain relatively higher than corresponding market values. Despite these challenges, the property market still presents viable opportunities in line with future corporate occupier demand.

Inflation adjusted financial performance

Revenue increased by 80% in the 15 months under review to ZW$561 million. Apart from the effect of a longer period under review, the revenue growth is also attributable to periodic rent reviews and increased occupancy from 79% to 81%, The Group’s net property income percentage decreased from 83% to 79% due to increases in property expenses. The Group implemented several property maintenance projects to improve and maintain the quality of space so as to attract new tenants as well as ensuring tenant retention.

Operating profits increased by 62% from ZW$185 million to ZW$300 million. The Group’s operating profit margin however decreased from 59% to 53% due to the increase in property and administration expenses. Notwithstanding the macro-economic challenges, collections percentage improved from 90% in September 2020 to 94% as at December 2021. The collections were improved through sustained credit risk assessments on tenant on-boarding and continuous engagements with sitting tenants.

Investment property

The Group investment properties were independently valued at 31 December 2021 by EPG Global, a professional property valuer. The Group’s investment property portfolio was valued at ZW$13.9 billion, which represents an 11% capital loss from the inflation adjusted valuation performed as at 30 September 2020.

The capital loss reflects the current portfolio’s CBD concentration. The Harare CBD sector has been negatively impacted by a reduction in space demand due to the worsening urban problems such as deteriorating building infrastructure, street trading, congestion, noise pollution, and the attendant high building operating costs among others. Thus, the Group’s strategy is premised on portfolio diversification to reduce the CBD office concentration while increasing investments in the emerging sectors of the market, which include healthcare, flexible warehousing and logistics, hospitality, retail and office park segments.

Property development projects

Mashview Gardens

During the period, the Group launched the Mashview Gardens cluster housing project in Bluff Hill in Harare. The project, which comprises of 25 modern housing units, was fully sold off plan and construction works are in progress. The project is targeted for completion in the last quarter of the ensuing financial year.

12 Van Praagh Day Hospital Project

The Group secured an agreement to develop and lease a hospital at one of its properties in Milton Park Harare. A change of use permit from residential to medical use was secured in December 2021. Pre-construction works are currently in progress with construction of the healthcare facility targeted to commence in the second quarter of 2022.

Windsor Park Ruwa residential stand sales

Following the securing of a certificate of compliance from the Ruwa Town Board, the Group commenced the disposals for its 24 fully serviced medium density residential stands averaging 800-1100 square meters in Windsor Park, Ruwa. Funds raised from the disposal of these stands are anticipated to create further liquidity to support other strategic development works.


The Board declared and paid an interim dividend of ZW$21,932,027 or 1.299 cents per share in June 2021.The Board has further declared a final dividend payable of ZW$50,678,148 or 3.003 cents per share. A separate dividend notice will be published to this effect.


The Government of Zimbabwe expects the economy to record a positive growth of 5.5% driven by increased industrial and agricultural output. The improved Gross Domestic Product, together with containment of the COVID-19 pandemic, is expected to contribute towards an improvement in the country’s economic performance including taming of inflation. These positive developments are expected to contribute towards an improvement in property investment yields and will sour new developments in the property market.

The Group is therefore targeting to make investment in-roads