Grit Real Estate Income Group ABRIDGED UNAUDITED CONSOLIDATED RESULTS FOR THE SIX AND TWELVE MONTHS ENDED 30 JUNE 2025
12/08/2025 09:00
| Grit Real Estate Income Group (GR1T) ABRIDGED UNAUDITED CONSOLIDATED RESULTS FOR THE SIX AND TWELVE MONTHS ENDED 30 JUNE 2025 12-Aug-2025 / 09:00 GMT/BST
Grit Real Estate Income Group Limited, a leading Pan-African real estate company focused on investing in, developing and actively managing a diversified portfolio of assets underpinned by predominantly US Dollar and Euro denominated long-term leases with high quality multi-national tenants, today announces its unaudited results for the six and twelve months ended 30 June 2025. Bronwyn Knight, Chief Executive Officer of Grit Real Estate Income Group Limited, commented: “Grit’s performance reflects persistent macroeconomic headwinds, particularly policy changes in the United States that have triggered capital outflows from emerging markets. These shifts have tightened liquidity conditions and disrupted demand-supply dynamics across the continent, prompting a widespread reassessment of real estate valuations and exerting downward pressure on distributable earnings. Investor sentiment remained cautious, with subdued appetite widening bid-ask spreads and delaying the Group’s asset recycling programme. Elevated finance costs further constrained free cash flow, contributing to covenant-related liquidity pressures. Despite these headwinds, Grit remains focused on repositioning the portfolio toward more defensive, higher-yielding asset classes such as diplomatic housing, data centres, light industrial and logistics, and Business Process Outsourcing (BPO) infrastructure, supported by strong tenant demand and long-term sovereign-grade leases. The Group continues to deliver against key performance indicators within its control by actively mitigating exogenous factors to support long-term sustainability, while acknowledging the impact of valuation pressures and constrained distributable earnings in the short term. It is especially encouraging to note that several initiatives introduced in prior reporting periods are increasingly delivering tangible results. These include a reduction in administration expenses, the maintenance of a long lease profile, strong contractual rental collections and increased portfolio occupancy. Looking ahead, our diversified footprint - both geographically and across asset classes - continues to position the portfolio defensively, with a substantial portion of income secured through long-term hard currency leases. This solid foundation enables Grit to provide a degree of income stability in an otherwise volatile capital environment, while addressing balance sheet constraints through disciplined capital recycling and asset management initiatives.” Financial and Portfolio highlights
The sustained high interest rate environment continued to weigh on African real estate markets, dampening investor appetite and constraining asset pricing negotiations. Elevated inflation added further pressure on consumers, contributing to broad-based valuation headwinds across the sector. For Grit, the elevated cost of capital delayed progress on its asset disposal programme, while increased finance costs and downward property revaluations placed strain on covenant metrics - most notably the Group’s interest cover ratio. While funder support remains intact, the Group is actively evaluating strategic options to optimise its capital structure and establish a more resilient, liquid, and growth-oriented platform. As a result, and as previously guided, the Group adopted a prudent approach to business operations, prioritising tenant retention and lease security amid a slowdown in corporate expansion. The Group continues to benefit from its quality portfolio with leading ESG credentials, increasing portfolio occupancy for the six months ended 30 June 2025 by 2.2% to 92.0% year-on-year, with 91.7% of income produced in US dollar, Euro or pegged currencies. 84.7% of revenue is earned from multinational tenants (30 June 2024: 85.4%). In the context of the current operating environment, the Group balanced longer-term lease renewals with reversionary rates, maintaining a weighted average lease profile of 4.6 years (30 June 2024: 5.2 years). Strong focus on contractual rental collections was maintained, with an average collection rate of 91.3%, a 0.2% increase on the prior year comparative period. The Group’s strategic pivot toward more defensive, higher-yielding asset classes - including Business Process Outsourcing (BPO) infrastructure, data centres, light industrial and logistics facilities, and diplomatic housing - was tempered by constrained access to development capital, despite a robust committed pipeline and strong co-investor support. Nevertheless, during the review period, Grit advanced its sector-focused development strategy through the establishment of Africa’s largest embassy accommodation platform. The consolidated entity, DH Africa, represents a scaled and specialist vehicle designed to better serve diplomatic clients, including the US Government and other sovereign stakeholders. This enhanced platform not only expands Grit’s exposure to resilient, income-generating assets but also unlocks additional revenue streams through development fees and asset management income. Property values, based on Grit’s proportionate share of the total portfolio, including joint ventures, contracted by 1.8% over the 12-month period ended 30 June 2025 to US$857.6 million (30 June 2024: US$873.0 million). The reduction was primarily as a result of negative fair value adjustments of US$43.8 million, a 5.0% decrease, offset by positive foreign currency movements of US$14.9 million and the consolidation of Rosslyn Grove diplomatic housing (DH3) development in Kenya. The Group’s proportionate Property Portfolio Net Operating Income (NOI) declined by 7.1% over the comparative six-month period to 30 June 2025, but recorded a 1.1% increase over the 12-month period ended 30 June 2025. This year-on-year increase was offset by a US$9.6 million impact as a result of changes in non-controlling interests, stemming from the June 2024 disposal of Bora Africa Group to Gateway Real Estate Africa Limited (“GREA”), reducing Grit’s effective ownership from 100% to 53.24%. NOI came under further pressure as a result of rental reversions to secure key long-term lease renewals and lease concessions granted, particularly within the retail sector. For the six months to 30 June 2025, EPRA net reinstatement value (“NRV”) declined by US$9.5 cents per share to US$48.4 cents per share (30 June 2024: US$57.9 cents per share), mainly due to the decrease in the fair value adjustment made on investment properties during the period. This follows continued downward pressure on market rental rates as a result of rising inflation and unemployment, increased import duties and consumer pressure. This material contraction reflects broader valuation headwinds across African real estate markets, especially retail, and signals continued NAV pressure amid persistent inflation and global interest rate volatility The IFRS NAV concomitantly contracted meaningfully over the reporting period, reflecting the broader valuation pressures across African real estate markets. As at 30 June 2025, IFRS NRV declined to US$35.5 cents per share, down from US$43.9 cents per share in the prior year. Despite these valuation challenges, Grit’s NRV remains underpinned by a portfolio of income-producing assets valued at US$988.8 million, with 91.7% of revenue earned in hard or pegged currencies and 84.7% derived from multinational tenants. The Group’s disciplined approach to capital recycling, lease renewals, and cost containment has helped mitigate the impact of external pressures, while its strategic pivot toward defensive asset classes and sovereign-grade leases provides a foundation for long-term value recovery. During the twelve-month period ended 30 June 2025, administrative expenses reported under IFRS declined by 1.4% year-on-year, despite the full-year consolidation of costs from the Group’s project development arm Africa Property Development Managers Limited (“APDM”), totalling US$4.0 million. Excluding the consolidation of APDM, underlying administrative expenses decreased by 13.9% year-on-year, reflecting improved operational efficiency. For the six-month period ended 30 June 2025, administrative expenses under IFRS fell by 9.7% year-on-year. Adjusting for APDM-related costs, the decline was even more pronounced at 21.6%, highlighting the tangible impact of the Group’s targeted savings initiatives. Administrative expenses as a percentage of total income-producing assets reduced to 1.26% for the six months ended 30 June 2025, down from 1.63% for the prior comparable period. This is closely aligned with the Group’s near-term target of 1.25% The weighted average cost of debt for the Group, reduced to 9.41% at 30 June 2025, down from 10.00% in the prior 12-month comparative period. For this period, finance charges increased by 20.8% mainly due to the full twelve- month impact of finance costs associated with the acquisition of GREA (the comparative period reflected a seven- month impact following GREA’s consolidation on 30 November 2023. Despite higher borrowings, the impact was partially mitigated by marginal reductions in global interest rates and the strategic use of interest rate derivatives. During the six-month period ended 30 June 2025, finance charges increased by 3.3% versus the comparable period, primarily due to increased borrowings. FOR FURTHER INFORMATION, PLEASE CONTACT:
Grit Real Estate Income Group Limited is the leading Pan-African real estate company focused on investing in, developing and actively managing a diversified portfolio of assets in carefully selected African countries (excluding South Africa). These high-quality assets are underpinned by predominantly US$ and Euro denominated long-term leases with a wide range of blue-chip multi-national tenant covenants across a diverse range of robust property sectors. The Company is committed to delivering strong and sustainable income for shareholders, with the potential for income and capital growth. The Company holds its primary listing on the Main Market of the London Stock Exchange (LSE: GR1T and a secondary listing on the Stock Exchange of Mauritius (SEM: DEL.N0000). Further information on the Company is available at www.grit.group. Directors: Peter Todd (Chairman), Bronwyn Knight (Chief Executive Officer) *, Gareth Schnehage (Chief Financial Officer) *, David Love+, Catherine McIlraith+, Cross Kgosidiile, Lynette Finlay + and Nigel Nunoo+. (* Executive Director) (+independent Non-Executive Director) Company secretary: Intercontinental Fund Services Limited Corporate service provider:Mourant Governance Services (Guernsey) Limited Registered office address: PO Box 186, Royal Chambers, St Julian's Avenue, St Peter Port, Guernsey GY1 4HP Registrar and transfer agent (Mauritius): Onelink Ltd SEM authorised representative and sponsor: Perigeum Capital Ltd UK Transfer secretary: MUFG Corporate Markets Mauritian Sponsoring Broker: Capital Markets Brokers Ltd This notice is issued pursuant to the FCA Listing Rules, SEM Listing Rules 15.24 and 15.44 and the Mauritian Securities Act 2005. The Board of the Company accepts full responsibility for the accuracy of the information contained in this communiqué. A presentation of these results will be made available on the Company website:https://grit.group/investor-relations/ CHAIRMAN’S STATEMENT Grit is a leading, woman-led real estate platform, delivering property investment and associated real estate services across Africa. Since its founding in 2014, the Group has pioneering forward-thinking investment models and strategic alliances that extend beyond conventional real estate approaches. Through an unwavering commitment to social impact, energy efficiency, and carbon reduction, it has actively shaped the built environment with a long-term vision for sustainability across its portfolio. The year under review was marked by heightened macroeconomic uncertainty across the African continent, driven by global policy shifts, inflationary pressures, and constrained liquidity conditions. Against this backdrop, the Group continued to execute its Grit 2.0 strategy, prioritising capital recycling, operational efficiency, and a pivot toward defensive, income-generating asset classes. Our strategic focus on sovereign-grade leases and hard currency income streams has proven instrumental in navigating valuation headwinds and sustaining portfolio resilience. The successful consolidation of DH Africa and the creation of the continent’s largest embassy accommodation platform mark a significant milestone in Grit’s evolution. This transaction not only deepens our sectoral expertise but also enhances scale, income diversity, and long-term alignment with diplomatic and sovereign clients. Financial and operational performance Grit’s financial performance for the year reflects the impact of valuation pressures and constrained distributable earnings. EPRA Net Reinstatement Value (NRV) contracted by 16.4% to US$48.4 cents per share, primarily due to negative fair value adjustments of US$43.8 million across the portfolio. IFRS NRV declined to US$35.5 cents per share, underscoring the broader reassessment of real estate values across the continent, particularly within the retail sector. Despite these challenges, operational metrics remain robust. EPRA portfolio occupancy improved to 92.0%, supported by tenanting initiatives in Kenya and Mauritius. Contractual rental collections increased to 91.3%, while 91.7% of revenue was earned in hard or pegged currencies. Administrative expenses declined by 13.9% year-on-year on a like-for-like basis, reflecting the tangible impact of cost containment initiatives and strategic outsourcing. Capital recycling and debt reduction The Group remains firmly committed to its accelerated strategy to reduce debt and optimise the balance sheet. During the period, US$200 million in non-core assets were identified for disposal, with advanced negotiations underway for key divestments including Tamassa Lux Resort and Artemis Curepipe Hospital. Proceeds from these disposals will be strategically redeployed into higher-yielding, more defensive investments. The weighted average cost of debt reduced to 9.41%, down from 10.27% in the prior year, supported by proactive interest rate hedging and refinancing initiatives. As at 30 June 2025, 73.4% of US$ SOFR-linked debt was hedged, and further improvements to the interest cover ratio are expected as disposals progress and capital is reallocated. Dividends In light of the distributable loss of US$12.4 million for the twelve-month period ended 30 June 2025, and the Group’s continued focus on balance sheet optimisation, the Board has resolved not to declare a dividend. Outlook The Board and management of Grit recognise that a recalibration of the Group’s capital structure is necessary to better align the business with its long-term strategic objectives. As part of ongoing asset recycling and deleveraging efforts, capital reorganisation is expected to support: Improved free cash flow generation through targeted debt reduction as well as enhanced flexibility in meeting near-term obligations and dividend distribution potential. More critically, the Company aims to unlock value-accretive growth by accelerating the development of GREA’s secured pipeline of high-yield projects in: BPO infrastructure Data centres Light industrial/logistics assets Diplomatic housing infrastructure. These core sectors remain underpinned by structural demand and robust tenant interest. However, their realisation is currently constrained by limited access to development capital, despite strong co-investor support. Management is carefully assessing all options to optimise the capital base, with a view to creating a sustainable platform that balances liquidity, resilience,andgrowth. On behalf of the Board, I extend our sincere appreciation to our shareholders for their continued support and confidence in Grit’s strategic direction. We remain committed to delivering on our mandate and advancing our role as a leading impact-driven real estate platform across Africa. Peter Todd Chairman 12 August 2025 CHIEF EXECUTIVE OFFICER’S STATEMENT Introduction Notwithstanding challenging market conditions, the Group continues to implement its Grit 2.0 strategy, focused on prudent capital allocation, cost reduction, active interest rate management and balance sheet optimisation through capital recycling and investment in more defensive, higher-yielding asset classes. Operational review The twelve months to 30 June 2025 were marked by heightened macroeconomic volatility across key African markets, driven largely by global trade disruptions and domestic fiscal constraints. The re-escalation of tariff wars following policy shifts in the United States has triggered capital outflows from emerging markets, resulting in tighter liquidity conditions and elevated borrowing costs across the continent. This has had a direct impact on real estate investment appetite, with delays in corporate expansion and tenant decision-making becoming increasingly pronounced. In Mozambique, socio-political instability and regulatory uncertainty have compounded these pressures, leading to a slowdown in foreign direct investment and a more cautious stance from multinational occupiers. Across the broader region, elevated commercial lending rates - particularly in Kenya (15% - 20%) and Ghana (28%) - have constrained access to affordable finance, further delaying development pipelines and lease commitments. Consumer pressure has intensified amid rising inflation and currency volatility, with household purchasing power eroded by elevated food and energy costs. This has translated into weaker retail performance, with tenants increasingly seeking lease renegotiations, shorter lease terms, and rental concessions to preserve occupancy. As a result, the retail sector remains most exposed to affordability constraints, while light industrial, business processing and data centre assets have shown relative resilience due to their alignment with logistics and digital infrastructure demand. Valuation headwinds persist across most asset classes, with retail properties facing the steepest declines. This is attributed to suppressed consumer demand, increased import duties, and inflation-linked cost pressures that have undermined tenant profitability and rental growth. In response, Grit has adopted a more conservative approach to tenant risk and expansion strategy, prioritising defensive asset classes and stable jurisdictions. These challenges impacted our net asset value, with EPRA NRV per share for the six months to end June 2025 contracting by US$9.5 cents per share or 16.4% to US$48.4 cents per share. Likewise, IFRS NAV contracted to US$35.5 cents per share. For the twelve-month period ended 30 June 2025, the Group’s distributable performance turned negative, recording a loss of US$12.4 million compared to earnings of US$1.2 million in the prior year. This decline was largely driven by lower net operating income, the impact of rental reversions in the retail sector, and reduced economic interest following the June 2024 disposal of the Bora Africa Group to GREA, which lowered the Group’s effective ownership from 100% to 53.24% and contributed to a US$9.6 million contraction in NOI at a GRIT economic interest level. Additional pressures on NOI arose from rental reversions to secure key long-term lease renewals and lease concessions granted, particularly within the retail sector. Property Portfolio Revenue increased by 2.2% compared to the prior year but decreased by 6.4% for the six-month period ended 30 June 2025. Similarly, the Group’s Proportionate NOI recorded a 1.1% increase over the 12-month period ended 30 June 2025 but declined by 7.1% over the six-month period. Contractual rental collections improved to 91.3% from 91.1% at 30 June 2024, whilst 91.7% of the Group’s revenue is earned in hard currency or from hard currency-linked long-term leases with mainly multinational, blue-chip tenants. EPRA portfolio occupancy improved to 92.0% as at 30 June 2025, a 2.2% increase on the prior six months, mainly as a result of tenanting initiatives at Eneo at Tatu Central in Kenya, and Unity Building at The Precinct in Mauritius, which is now fully let. Cost containment During the twelve-month period ended 30 June 2025, administrative expenses reported under IFRS decreased by 1.4% year-on-year, notwithstanding the full-year inclusion of costs associated with the Group’s project development subsidiary, APDM. These expenses totaled US$4.0 million, compared to US$2.1 million in the prior year, when APDM was consolidated for only seven months following its effective date of 30 November 2023. Owing to the limited development activity undertaken during the period, APDM-related costs were recognised as administrative expenses rather than capitalised. Excluding APDM, underlying administrative expenses registered a notable year-on-year decline of 13.9%, underscoring improved operational efficiency. Focusing on the six-month period ended 30 June 2025, administrative expenses under IFRS declined by 9.7% year-on-year. When adjusted for APDM, the decrease improved to 21.6%, illustrating the substantive impact of the Group’s targeted savings initiatives. Administrative expenses as a proportion of total income-producing assets fell to 1.26% for the six months ended 30 June 2025, down from 1.63% in the prior comparable timeframe. This metric closely mirrors the Group’s short-term target of 1.25%, further affirming progress toward its medium-term goal of 1.0%. The Group’s strategic partnership with Broll Property Group (“Broll”) effective from 1 February 2025, is expected to further support Grit’s medium-term objective of reducing costs. This partnership is expected to deliver annual cost savings of approximately US$1 million and streamline operational efficiencies, enabling the Group to focus on its core expertise in impact real estate development, strategic asset management and retaining key tenant relationships. Finance costs For the twelve months ended 30 June 2025, finance charges increased by 20.8% year-on-year, largely reflecting the full-year impact of finance costs associated with the acquisition of GREA. In the comparative period, only seven months of GREA-related finance charges were recognised, following its consolidation effective 30 November 2023. Despite increased borrowings, the overall impact was partially offset by modest reductions in global interest rates and the Group’s proactive use of interest rate derivatives. These measures contributed to a reduction in the weighted average cost of debt to 9.41% as at 30 June 2025, down from 10.00% in the prior year. During the six-month period to 30 June 2025, finance charges rose by 3.3% compared to the prior period, primarily attributable to higher borrowing levels in support of the Group’s strategic growth initiatives. During the reporting period, the Group increased its hedging positions to 71.8% of its US$ SOFR exposure from 60.8% in the corresponding period. Further hedging and capital allocation, particularly from disposals, is expected to improve the Group’s interest cover ratio (ICR) over the medium term. Creation of largest embassy accommodation platform in Africa and equity issue On 20 June 2025, the Group officially implemented the creation of Africa’s largest embassy accommodation platform through the combination of DH Africa and Verdant Ventures as well as Verdant Property Holdings Ltd’s (collectively “Verdant”) diplomatic housing businesses. This transaction aligns with the Grit 2.0 strategy to streamline operations and deepen sector-focused expertise within its development subsidiary, GREA. In exchange for increasing its stake to 99.99% in DH Ethiopia and DH Kenya, and gaining access to DH Ghana, Grit issued 24,742,277 new ordinary shares of no-par valueat an issue price of US$33.90 cents per share to Verdant, making Verdant a significant minority shareholder. These shares were listed on the LSE and SEM effective 20 June 2025. DH Africa now encompasses three income-generating assets with a combined valuation of US$206.9 million, supported by long-term, sovereign-grade leases and a WALE of 5.2 years. The platform’s future development pipeline includes US$130 million in projects across key geographies, which will enhance scale and income diversity once substantially pre-let. This enhanced structure positions Grit to benefit from the US State Department’s reform agenda and unlock recurring development and management income, reinforcing its role as a high-quality partner for diplomatic accommodation across Africa. The full financial and strategic impact of the transaction is expected to be realised in the coming financial years. Asset recycling In the face of continued global market volatility and liquidity constraints across key African jurisdictions, the Group remains resolute in executing its asset disposal strategy - aimed at deleveraging the balance sheet and reducing the weighted average cost of capital. Central to this approach is the divestment of non-core and non-strategic assets, facilitating the redeployment of capital into higher-yielding, more resilient investments aligned with the Group’s long-term objectives. As part of its strategic repositioning, the Group has earmarked an additional US$200 million in non-core assets for disposal. While macroeconomic headwinds (outlined earlier in this report) have contributed to delays in the sale of Tamassa Lux Resort and Artemis Curepipe Hospital, negotiations remain active. Concurrently, meaningful progress is being made on the potential divestment of Anfa Place Mall, alongside other selected retail and non-core corporate accommodation assets. Change to accounting reference date and financial year end Shareholders are referred to the RNS announcement of 18 June 2025, where the Group announced a change to its accounting reference date and financial year end from 30 June to 31 December. The Board considers that this change will better align the reporting period to the operations of the business across all subsidiaries in the Group, as following this change all Group companies will follow the same accounting reference date. In addition, following a mandatory audit firm rotation, the change will allow the Company’s recently appointed auditors, MacIntyre Hudson LLP with Baker Tilly CI Audit Limited sufficient time to better understand the Group and complete their planning to ensure an efficient audit. Accordingly, the Company’s next audited financial statements will be prepared for the 18-month period ending 31 December 2025 and will be required to be published on or before 30 April 2026. Thereafter, the Company will publish each year its unaudited interim results for the 6 month ending 30 June by 30 September, and its audited financial statements for the 12 months ending 31 December by 30 April in accordance with the Disclosure Guidance and Transparency Rules. Outlook Looking ahead, management remains focused on implementing a disciplined optimisation strategy that prioritises income resilience, cost efficiency, and capital redeployment. Our recovery and business enhancement plan remains structured around six key pillars: Deepening capital partnerships through closer engagement with existing and new funders to lower the cost of funding Strengthening operational performance through tenant retention, rental collections, and sustainable real estate delivery, while improving profitability via reduced operating costs and enhanced recoveries. Recycling non-core assets to unlock capital for debt reduction and reinvestment into higher-yielding, strategically aligned properties. Deleveraging the balance sheet to create headroom for future growth and reduce overall funding costs. Streamlining operations by consolidating assets into specialised substructures and leveraging technology to enhance systems, processes, and workforce efficiency. Driving down administrative expenses with a clear target of reducing costs to 1.0% of total income-producing assets over the medium term. Presentation of financial results The condensed unaudited consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the IASB. Alternative performance measures (APMs) have also been provided to supplement the condensed financial statements as the Directors believe that this adds meaningful insight into the operations of the Group and how the Group is managed. European Public Real Estate Association (“EPRA”) Best Practice Recommendations have been adopted widely throughout this report and are used within the business when considering the operational performance of our properties. Full reconciliations between IFRS and EPRA figures are provided in notes 16a to 16b. Other APMs used are also reconciled below. “Grit Proportionate Interest" income statement, presented below, is a management measure to assess business performance and is considered meaningful in the interpretation of the financial results. Grit Proportionate Interest Income Statement (including “Distributable Earnings”) are alternative performance measures. In the absence of the requirement for Distributable Reserves in the domicile countries of the group, Distributable Earnings is utilised to determine the maximum amount of operational earnings that would be available for distribution as dividends to shareholders in any financial period. This factors the various company specific nuances of operating across a number of diverse jurisdictions across Africa and the investments’ legal structures of externalising cash from the various regions. The IFRS statement of comprehensive income is adjusted for the Group proportionate share of the income statement line items of properties held in joint ventures and associates. This measure, in conjunction with adjustments for non-controlling interest (for properties consolidated by the group, but part owned by minority partners), form the basis of the Group’s distributable earnings build up, which is alternatively shown in Note 16b –Distributable Earnings. Performance for the six months ended 30 June 2025 For the six months ended 30 June 2025, the Group reported a distributable loss of US$7.7 million, compared to US$4.2 million for the corresponding period in 2024. The key drivers for the year-on-year variance is net operating income which was largely impacted by rental reversions to secure key long term lease renewals, lease concessions granted, particularly within the retail sector as well as the impact of foreign exchange on rental income in Ghana. Although global interest rates remained elevated, most notably on SOFR-linked debt, the increase in finance charges contributed only a modest 2.9% year-on-year increase in the distributable loss.Offsetting these pressures, the Group continued to drive down administration expenses through targeted cost saving initiatives. As a result, administration expenses decreased by 16.8% year-on-year.
For the twelve month period ended 30 June 2025, the Group recorded a distributable loss of US$12.4 million, compared to distributable earnings of US$1.2 million for the prior corresponding period. The primary variance drivers for this variance are net operating income, which, while the Grit proportionate income statement reflected a 1.1% year-on-year increase in NOI, the was offset by a US$9.6 million impact stemming from changes in non-controlling interests when calculating the Group economic interest and distributable earnings. This effect primarily resulted from the June 2024 disposal of the Bora Africa Group to GREA, reducing the Group’s effective ownership from 100% to 53.24%. Additional pressures on NOI arose from rental reversions to secure key long term lease renewals and lease concessions granted, particularly within the retail sector. Finance costs increased by 6.4% year-on-year,driven by sustained elevated global interest rates, notably affecting debt linked to SOFR benchmarks. Partially offsetting these impacts, administration expenses declined by 25.4% year-on-year, reflecting the effectiveness of ongoing cost saving initiatives implemented across the Group.
Operational performance for the six and twelve months ended 30 June 2025 The Grit Proportionate Income Statement is further broken down to provide a sectoral analysis of Property Portfolio Revenue² and Net Operating Income (NOI)². Property Portfolio Revenue decreased by 6.4% for the six-month period ended 30 June 2025, while on a year-to-date basis, it increased by 2.2% compared to the prior year. Similarly, the Group’s Proportionate NOI declined by 7.1% over the six-month period but recorded a 1.1% increase over the 12-month period ended 30 June 2025.
1Rental Collections represents the amount of cash received as a percentage of contractual income. Contractual income is stated before the effects of any rental deferment and concessions provided to tenants. 2The Revenue and NOI figures presented in the table above reflect the Group’s consolidated results from its subsidiaries, along with its proportionate share of revenue and NOI from joint ventures, which are otherwise presented within ‘share of profit from joint ventures’ in the condensed consolidated interim financial statements.” Retail sector:Leasing activity in the retail sector remains strong, with new leases signed at both Anfa Place Mall and the Zambian malls. This has led to a reduction in overall vacancies from 14.2% in June 2024 to 12.8% in June 2025, despite ongoing challenges in the retail environment. However, revenue and Net Operating Income (NOI) for the six- and twelve-month periods ended 30 June 2025 have declined compared to 2024. This is primarily due to rental concessions that were conservatively accrued in the prior year but ultimately did not materialise and were reversed in 2024, resulting in an elevated comparative base. As these concessions reversal were not repeated in 2025, they contributed to the year-on-year decline. Additionally, NOI was further affected by rising operating costs, reflecting broader market pressures. Hospitality sector: Performance remained broadly in line with expectations, underpinned by strong occupancy levels at both Tamassa Resort and Club Med Cap Skirring Resort. The net decrease in revenue and Net Operating Income (NOI) for the six-month period was primarily due to development rental adjustments made during the period, which also contributed to a lower result over the twelve-month period. On a like-for-like basis, EBITDA rental from Tamassa was higher in 2024 compared to 2025, further contributing to the year-on-year decline. Office sector:5-year renewals were secured for Vodacom Mocambique SA and ATC Ghana Serviceco Limited, in Mozambique and Ghana, respectively. Recently completed assets such as The Precinct (Mauritius) and Eneo at Tatu Central (Kenya) also benefited from increased tenant demand, with both assets now reportingoccupancy rates aboves 92%. Light Industrial sector:Despite ongoing macroeconomic headwinds, the lease with Imperial Managed Solutions East Africa Limited was successfully renewed for a further five-year term, albeit at prevailing market rental levels. In Kenya, the challenging economic environment impacted the operations of Orbit Products Africa Limited, resulting in a reduced space requirement and a renegotiation of rental terms at lower rates. Although the surrendered space has since been fully re-let, it was done so at lower market rentals. In Mozambique, renewed optimism and positive developments in the LNG sector have supported market confidence, with Africa Global Logistics Moçambique S.A. now committing to a new five-year lease. Corporate accommodation sector: Despite global uncertainties and US policy changes, demand for corporate accommodation units remain healthy with TotalEnergies EP Mozambique Area1 Limitada renewing leases on 32 units in Acacia Estate (Mozambique) for a period of 5 years, as well lease renewals secured at Elevation Residences (Ethiopia). Healthcare and Data Centre sector:Properties within the Healthcare and Data Centre sectors have continued to perform well. The increase in revenue and Net Operating Income (NOI) compared to the prior periods was driven by the full-year consolidation of Africa Data Centres and Curepipe Artemis Hospital, contractual rental escalations on the data centre asset, and the appreciation of the Euro against the US Dollar, which positively impacted the Euro-denominated lease at Curepipe Artemis Hospital. Cost control During the twelve-month period ended 30 June 2025, administrative expenses reported under IFRS declined by 1.4% year-on-year, despite the full-year consolidation of costs from the Group’s project development arm (APDM), totalling US$4.0 million. This compares to seven months of APDM costs amounting to US$2.1 million in the prior year, following its consolidation effective 30 November 2023. Given the limited development activity undertaken during the period, APDM-related costs were absorbed under administrative expenses rather than capitalised as development costs. Excluding these, underlying administrative expenses decreased by 13.9% year-on-year—reflecting improved operational efficiency. For the six-month period ended 30 June 2025, administrative expenses under IFRS fell by 9.7% year-on-year. Adjusting for APDM-related costs, the decline was even more pronounced at 21.6%, highlighting the tangible impact of the Group’s targeted savings initiatives. Administrative expenses as a percentage of total income-producing assets reduced to 1.26% for the six months ended 30 June 2025, down from 1.63% for the prior comparable period. This is closely aligned with the Group’s short-term target of 1.25%, reinforcing momentum toward its medium-term goal of 1.0%.
For the twelve months ended 30 June 2025, finance charges increased by 20.8% year-on-year. This increase primarily reflects the full twelve-month impact of finance costs associated with the GREA acquisition. The comparative period reflected only seven months of GREA related finance charges, following its consolidation on 30 November 2023. Despite higher borrowings, the impact was partially mitigated by marginal reductions in global interest rates and the strategic use of interest rate derivatives, which collectively reduced the Group’s the weighted average cost of debt to 9.41% as of 30 June 2025, from 10.00% a year earlier. During the six-month period ended 30 June 2025, finance charges increased by 3.3% versus the comparable period, primarily due to increased borrowings. The net finance charge disclosed below includes an amortisation of loan issuance costs and the impact of interest rate derivatives utilised.
The exposure to interest rate risk at 30 June 2025 is summarised below, and the table highlights the value of the Group’s interest-bearing borrowings that are exposed to the base rates indicated:
The Group utilises interest rate derivative instruments as well as back-to-back arrangements with joint venture partners to partially mitigate against the risk of rising interest rates. Taking this into consideration along with the impact of fixed interest rate instruments the Group is 73.4% hedged on US$ loans but remains largely unhedged to interest movements on its EUR loans and local bank prime lending rates in Mauritius and South Africa. The hedged position of the Group as at 30 June 2025 is detailed below:
Management monitor and manages the business relative to the weighted average cost of debt (“WACD”), which is the net finance costs adjusted for the effects of interest rate derivative instruments that are in place as a percentage of the interest-bearing borrowings due at the reporting date. A sensitivity of the Group’s expected WACD to further movements in the base rates are summarised below:
For the year to date period ended 30 June 2025, the Group’s income producing assets increased by US$14.6 million, representing a 1.8% growth compared to the position as at 30 June 2024. The increase is primarily attributable to the consolidation of DH3 (refer to note 10) which transitioned from a joint venture to a fully consolidated subsidiary. The increase was partially offset by fair value adjustments recognised on investment properties (including those held by joint ventures) during the period, amounting to US$43.8 million.
Reported property values, based on Grit’s proportionate share of the total portfolio (including joint ventures), declined by 1.8% over the 12 months ended 30 June 2025. The reduction was primarily attributable to negative fair value adjustments of US$43.7 million, representing a 5.10% decrease. However, this was partially offset by positive foreign exchange movements amounting to US$14.9 million (+1.75%), mainly relating to properties valuation denominated in currencies that appreciated against the US dollar, notably AnfaPlace Mall, Club Med CapSkirring Resortand Kafubu Mall. During the period, Artemis Curepipe Hospital was classified as held for sale, while Rosslyn Grove in Kenya was fully consolidated as a subsidiary.
As at 30 June 2025, the Group’s interest-bearing borrowings totaled US$540.6 million, up from US$501.2 million at 30 June 2024. The increase of US$39.4 million primarily reflects the consolidation of DH3 on 30 June 2025, as further detailed in note 10.
A total facility of US$30.0 million was secured from MauBank Ltd by Grit Services Limited and Grit Real Estate Income Group Limited. A facility of approximately US$0.56 million (ZAR 10 million) was obtained from First National Bank to finance the acquisition of Parc Nicol. Gateway Real Estate Africa secured a facility of US$9.5 million from SBI (Mauritius) Ltd. A partial repayment of US$7.5 million was made on the SBSA facility relating to Zambian Property Holdings Limited. A further partial repayment of US$18.0 million was made on the SBSA corporate facility held by Gateway Real Estate Africa. A partial repayment of approximately US$3.2 million was made on the Investec facility relating to AnfaPlace Mall. The facility previously held by DH One Real Estate PLC with Bank of Oromia in Ethiopia, amounting to approximately US$4.8 million, was successfully refinanced through Zemen Bank. For more meaningful analysis, a further breakdown is provided below to better reflect debt related to non-consolidated joint ventures. As at 30 June 2025, the Group had a total of US$541.8 million in interest-bearing borrowings outstanding, comprised of US$538.0 million in subsidiaries (as reported in IFRS balance sheet) and US$3.8 million proportionately consolidated and held within its joint ventures.
1The facility held by the Group with Stanbic Bank has been aggregated with those of the Standard Bank Group. As of 30 June 2025, the total interest-bearing borrowings with Stanbic Bank amounted to US$ 43.9 million (30 June 2024: US$ 46.4 million). Net Asset Value and EPRA Net Realisable Value Further reconciliations and details of EPRA earnings per share and other metrics are provided in notes 16a to 16b.
No interim dividend has been declared for the six-month period ended 30 June 2025.
PRINCIPAL RISKS AND UNCERTAINTIES Grit has a detailed risk management framework in place that is reviewed annually and duly approved by the Risk Committee and the Board. Through this risk management framework, the Company has developed and implemented appropriate frameworks and effective processes for the sound management of risk. The principal risks and uncertainties facing the Group as at 30 June 2024 are set out on pages 80 to 85 of the 2024 Integrated Annual Report together with the respective mitigating actions and potential consequences to the Group’s performance in terms of achieving its objectives. These principal risks are not an exhaustive list of all risks facing the Group but are a snapshot of the Company’s main risk profile as at year end. The Board has reviewed the principal risks and existing mitigating actions in the context of the current reporting period and believes there has been no material change to the risk categories and are satisfied that the existing mitigation actions remain appropriate to manage them. STATEMENT OF DIRECTORS RESPONSIBILITIES IN RESPECT OF THE CONDENSED UNAUDITED CONSOLIDATED INTERIM FINANCIAL STATEMENTS The directors confirm that the condensed unaudited consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting, as issued by the International Accounting Standards Board (“IASB”). They further confirm that the interim financial report provides a fair review of the information required by the Disclosure Guidance and Transparency Rules (“DTR”) 4.2.7R and 4.2.8R, including:
The directors of the Group are listed in the Annual Report for the year ended 30 June 2024. A list of current directors is maintained on the Grit website: www.grit.group. On behalf of the Board
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The principal accounting policies applied in the preparation of this condensed consolidated interim financial statements are set out below. Basis ofPreparation The condensed unaudited consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting, as issued by the International Accounting Standards Board (“IASB”), together with interpretations issued by the IFRS Interpretations Committee, the pronouncements of the Financial Reporting Standards Council (“FRC”), and the listing rules of both the London Stock Exchange (“LSE”) and the Stock Exchange of Mauritius (“SEM”). The financial information presented in these condensed unaudited consolidated interim financial statements comprises the results of the holding company, Grit Real Estate Income Group, and its subsidiaries (the “Group”), together with the Group’s share of its investments in joint ventures. These condensed unaudited consolidated interim financial statements should be read in conjunction with the Group’s most recent audited consolidated statutory accounts for the year ended 30 June 2024. Change in Accounting Year End On 18 June 2025, the Company announced a change in its accounting reference date from 30 June to 31 December. As a result, the most recent audited consolidated statutory accounts covered the twelve-month period ended 30 June 2024, and the next audited consolidated statutory accounts will cover an eighteen-month transitional period ending 31 December 2025. Since the last audited statutory accounts, the Company has published consolidated interim results for the six-month period ended 31 December 2024. This announcement presents the Group’s second set of interim results, covering the six-month period from 1 January 2025 to 30 June 2025. Where relevant, financial information for the twelve months ended 30 June 2025 has been presented to provide appropriate year to date context, in accordance with the requirements of IAS 34. Going Concern The directors are required to consider an assessment of the Group's ability to continue as a going concern when producing the condensed consolidated interim financial statements. As of 30 June 2025, the Directors have assessed the Group’s financial position and concluded that the Group remains a going concern. The condensed unaudited consolidated financial statements for the period ended 30 June 2025 continue to be prepared on a going concern basis. Functional and presentation currency The condensed unaudited consolidated interim financial statements are prepared and are presented in United States Dollars (US$). Amounts are rounded to the nearest thousand, unless otherwise stated. Some of the underlying subsidiaries and joint ventures have functional currencies other than the US$. The functional currency of those entities reflects the primary economic environment in which they operate. Presentation of alternative performance measures The Group presents certain alternative performance measures on the face of the income statement. Revenue is shown on a disaggregated basis, split between gross rental income and the straight-line rental income accrual. Additionally, if applicable, the total fair value adjustment on investment properties is presented on a disaggregated basis to show the impact of contractual receipts from vendors separately from other fair value movements. These are non-IFRS measures and supplement the IFRS information presented. The directors believe that the presentation of this information provides useful insight to users of the financial statements and assists in reconciling the IFRS information to industry wide EPRA metrics. 1.2 Segmental reporting In accordance with IFRS 8, operating segments are identified based on internal financial reports regularly reviewed by the Chief Operating Decision Makers (CODM) for the purpose of allocating resources and assessing performance. The CODM was determined to be the C-Suite members of the Group.The C-Suite members, which include the Chief Executive Officer, Chief Financial Officer, and senior executives from GREA, have been identified as the CODM because they bear the primary responsibility for making strategic decisions regarding the allocation of resources to the Group’s operating segments and for evaluating the performance of these segments. In line with the requirements of IFRS 8, the Group's operating segments continue to be defined based on the nature of the properties and the markets they serve. These segments include Hospitality, Retail, Office, Light Industrial, Corporate Accommodation, Healthcare, Data Centres, Development Management, and Corporate functions. Management believes that this segmentation provides the most relevant information for stakeholders, and, accordingly, no further aggregation of operating segments into reportable segments has been made. Although the Group's operations span several geographical locations across Africa, and this geographic footprint is disclosed to provide users with a more comprehensive understanding of the Group’s activities, management primarily evaluates the performance of its segments based on their economic characteristics rather than their geographic location. 1.3 Significant accounting judgements, estimates and assumptions The preparation of these abridged consolidated half year financial statements in conformity with IFRS requires the use of accounting estimates which by definition will seldom equal the actual results. Management also needs to exercise judgement in applying the group's accounting policies. Estimates and judgements are continually evaluated. They are based on historical experience and other factors, including expectation of future events that may have a monetary impact on the entity and that are believed to be reasonable under the circumstances. Significant Judgements In the process of applying the Group’s accounting policies, management has made the following judgements. Historical significant judgements which continue to affect the condensed unaudited consolidated interim financial statements Freedom Asset Management (FAM) as a subsidiary The Group has considered Freedom Asset Management (FAM) to be its subsidiary for consolidation purposes due to the Group’s implied control of FAM, as the Group has ability to control the variability of returns of FAM and has the ability to affect returns through its power to direct the relevant activities of FAM. The Group does not own any interest in FAM however it has exposure to returns from its involvement in directing the activities of FAM. Grit Executive Share Trust (GEST) as a subsidiary The Group has considered Grit Executive Share Trust (GEST) to be its subsidiary for consolidation purposes due to the Group’s implied control of GEST, as the Group’s ability to appoint the majority of the trustees and to control the variability of returns of GEST. The Group does not own any interest in GEST but is exposed to the credit risk and losses of (GEST) as the Group shall bear any losses sustained by GEST and shall be entitled to receive and be paidany profits made in respect of the purchase, acquisition, sale or disposal of unawarded shares in the instance where shares revert back to GEST. Grit Executive Share Trust II (GEST II) as a subsidiary During the financial year 2023, Grit Executive Share Trust II has been incorporated to act as trust for the new long term incentive plan of the Group. The trust will hold Grit shares to service the new scheme when the shares will vest to the employees in the future. The corporate set-up of GEST II is like GEST and the Grouphas considered the latter to be a subsidiary due to the implied control that the Group has over it. African Development Managers Limited (“APDM”) as subsidiary Africa Development Managers Ltd transitioned from being classified as a joint venture to a subsidiary on 30 November 2023. Despite holding a majority shareholding of 78.95%, the Group previously did not exercise control over APDM due to the power criteria not being met under the previous shareholders agreement. Decision-making authority for relevant activities rested with the investment committee of the Company, requiring seventy-five percent of its members' approval for decisions to pass. The Group could appoint four out of the seven members to the committee, while the Public Investment Corporation (PIC), holding 21.05% of APDM, could appoint two members. Additionally, a non executive member was appointed. Given the requirement for unanimous agreement among the Group and PIC to pass resolutions, control was not previously established. On 30 November 2023, the Group and PIC collectively signed an amended and restated APDM shareholder agreement, clarifying and amending the shareholder rights. Notably, the decision approval threshold at the investment committee was lowered to a simple majority. With the Group's ability to appoint four out of seven members and the revised decision threshold, control now resides with the Group. In assessing control, the Group also evaluated the reserved matters outlined in the amended agreement, where PIC's approval is still required for specific events. Upon a comprehensive review performed by the Group, it was concluded that none of these matters grant PIC the ability to block decisions related to APDM's relevant activities, but rather are included to safeguard the minority shareholder's interests. Due to the inherent judgment that needs to be applied in interpreting terms that are protective rather than substantive, the Group has considered the interpretation of the reserved matters to be an area of significant judgement. Gateway Real Estate Africa Limited (“GREA”) as subsidiary. The Group has recognized Gateway Real Estate Africa Ltd (GREA) as a subsidiary on 30th of November 2023. Similar to APDM, although the Group held a majority equity stake in GREA, it was previously treated as a joint venture due to the previous shareholders agreement where its board of directors largely directed its relevant activities. The Group could appoint three out of seven directors on the board, while PIC could appoint two directors, with the remaining being nonexecutive. Decisions required seventy-five percent of present members' votes, necessitating the support of PIC for Grit to make decisions. On 30th of November 2023, the Group and PIC signed an amended and restated GREA shareholder agreement, clarifying and amending shareholder rights. Importantly, under the new agreement, the Group now has the ability to appoint four out of seven directors, while PIC retains the right to appoint two directors. The decision approval threshold at the board level has been lowered to a simple majority and it was therefore concluded that control of GREA has been established by the Group. The Group also evaluated specific events where PIC's approval is still required, reflected in the reserved matter section of the new agreement. Upon comprehensive review, it was concluded that these matters do not grant PIC the ability to block decisions related to GREA's relevant activities but are included to safeguard PIC's interests. Due to the inherent judgment that needs to be applied in interpreting terms that are protective rather than substantive, the Group has considered the interpretation of the reserved matter to be an area of significant judgement. Significant Estimates The principal areas where such estimations have been made are: Fair value of investment properties The fair value of investment properties and owner occupied property are determined using a combination of the discounted cash flows method and the income capitalisation valuation method using assumptions that are based on market conditions existing at the relevant reporting date. For further details of the valuation method, judgements and assumptions made, refer to note 2. 2. INVESTMENT PROPERTIES
2St Helene, the beneficial owner of Artemis Curepipe Clinic has been reclassified as held for sale during the reporting period. Refer to note 11 for more information. Lease incentive asset included in investment property In accordance with IFRS 16, rental income is recognised in the Group income statement on a straight-line basis over the lease term. This includes the effect of lease incentives given to tenants. The Group has granted lease incentives to tenants (in the form of rent-free periods). The result is a receivable balance included within investment property in the balance sheet as those are balances that must be considered when reconciling to valuation figures to prevent double counting of assets. This balance is subject to impairment testing under IFRS 9 using the simplified approach to expected credit loss of IFRS 9.
3. INVESTMENTS IN JOINT VENTURES The following entities have been accounted for as associates and joint ventures in the current and comparative consolidated financial statements using the equity method:
2Joint venture status changed to subsidiary during the period. Refer to note 10 for more information. All investments in joint ventures are private entities and do not have quoted prices available. The two tables below present a reconciliation of the carrying value of the investment in joint ventures at 30 June 2025 for the six-month period ended 30 June 2025, as well as for the twelve-month period ended 30 June 2025. Reconciliation of carrying value in joint ventures for the six months to 30 June 2025
International Finance Corporation ("IFC") Perpetual Preference Notes During the financial year 2024, the Group, through one of its indirect subsidiaries, Orbit Africa Limited ("OAL"), has issued perpetual preference notes to the International Finance Corporation ("IFC"). The proceeds received by the Group from the issue amounted to US$16.8 million. Below are the salient features of the notes: - The notes attract cash coupon at a rate of 3% + Term SOFR per annum and a 3% redemption premium per annum. At its sole discretion, the Group has the contractual right to elect to capitalize the cash coupons. - The notes do not have a fixed redemption date and are perpetual in tenor. However, if not redeemed on the redemption target date, the notes carry a material coupon step-up provision and are therefore expected to result in an economic maturity and redemption by the Group on or before that date. - The Group has classified the notes in their entirety as equity in the statement of financial position because of the unconditional right of the Group to avoid delivering cash to the noteholder. TRG Africa Mezzanine Partners GP Proprietary Ltd and Blue Peak Private Capital GP Perpetual Preference Notes In the financial year 2022, the Group through its wholly owned subsidiary Grit Services Limited has issued perpetual preference note to two investors TRG Africa Mezzanine Partners GP Proprietary Ltd (“TRG Africa”) and Blue Peak Private Capital GP (“Blue Peak”). The total cash proceeds received from the two investors for the issuance of the perpetual note amounted to US$31.5million. Below are salient features of the notes: - The Note has a cash coupon of 9% per annum and a 4% per annum redemption premium. The Group at its sole discretion may elect to capitalise cash coupons. - Although perpetual in tenor, the note carries a material coupon step-up provision after the fifth anniversary that is expected to result in an economic maturity and redemption by the Group on or before that date. - The Note may be voluntarily redeemed by the Group at any time, although there would be call-protection costs associated with doing so before the third anniversary. - The Note if redeemed in cash by the Group can offer the noteholders an additional return of not more than 3% per annum, linked to the performance of Grit ordinary shares over the duration of the Note. - The noteholders have the option to convert the outstanding balance of the note into Grit equity shares. If such option is exercised by the noteholders, the number of shares to be issued shall be calculated based on a pre-defined formula as agreed between both parties in the note subscription agreement. On recognition of the perpetual preference note, the Group has classified eighty five percent of the instrument that is US$26.8million as equity because for this portion of the instrument the Group at all times will have an unconditional right to avoid delivery of cash to the noteholders. The remaining fifteen percent of the instrument that is US$4.7million has been classified as debt and included as part of interest bearing borrowings. The debt portion arises because the Note contains terms that can give the noteholders the right to ask for repayment of fifteen percent of the outstanding amount of the note on the occurence of some future events that are not wholly within the control of the Group. The directors believe that the probability that those events will happen are remote but for classification purposes, because the Group does not have an unconditional right to avoid delivering cash to the noteholders on fifteen percent of the notes, this portion of the instrument has been classified as liability. The incremental costs directly attributable to issuing the notes (classified as equity) have been recorded as a deduction in equity, in the same equity line where the equity portion of the instrument has been recorded, so that effectively the equity portion of the instrument is recorded net of transaction costs. 6. INTEREST-BEARING BORROWINGS The following debt-related transactions were concluded during the period under review: A total facility of US$30.0 million was secured from MauBank Ltd by Grit Services Limited and Grit Real Estate Income Group Limited. A facility of approximately US$0.56 million (ZAR 10 million) was obtained from First National Bank to finance the acquisition of Parc Nicol. Gateway Real Estate Africa secured a facility of US$9.5 million from SBI (Mauritius) Ltd. A partial repayment of US$7.5 million was made on the SBSA facility relating to Zambian Property Holdings Limited. A further partial repayment of US$18.0 million was made on the SBSA corporate facility held by Gateway Real Estate Africa. A partial repayment of approximately US$3.2 million was made on the Investec facility relating to AnfaPlace Mall. The facility previously held by DH One Real Estate PLC with Bank of Oromia in Ethiopia, amounting to approximately US$4.8 million, was successfully refinanced through Zemen Bank.
7. GROSS PROPERTY INCOME
10. ACQUISITION OF SUBSIDIARY AND TRANSACTION WITH NON-CONTROLLING INTEREST Completion of the Establishment of the Diplomatic Accommodation Platform 10.1 Consolidation of DH3 Kenya In continuation of the disclosures in Notes30(b) and41 of the Group’s 2024 Annual Report, Grit Real Estate Income Group (“the Group”) announced in June2025 that all outstanding conditions and implementation steps had been fulfilled to combine the diplomatic housing businesses of its subsidiary, Diplomatic Holdings Africa Ltd (“DH Africa”), with those of Verdant Ventures LLC and Verdant Property Holdings Ltd (together, “Verdant”). Gateway Real Estate Africa (“GREA”), a subsidiary of the Group, together with Verdant, had previously co-developed the Elevation Diplomatic Residences in Addis Ababa, Ethiopia (“DH Ethiopia”) and the Rosslyn Grove Diplomatic Apartment and Townhouse Complex in Nairobi, Kenya (“DH Kenya”), with GREA and Verdant each holding a 50% equity interest in these entities. Following completion of the transaction, DH Africa now holds a 99.9% equity interest in both DH Ethiopia and DH Kenya and has secured exposure to DH Ghana, a 108-unit diplomatic development in Ghana, through a convertible note. As at 30 June 2025, the properties owned by DH Africa comprise (i) Acacia Estate in Mozambique, (ii) Elevation Diplomatic Residences in Ethiopia, (iii) Rosslyn Grove Diplomatic Apartment and Townhouse Complex in Kenya, and (iv) a land plot in Mali earmarked for future consular accommodation. As part of the transaction, Verdant subscribed for shares in DH Africa, which was previously wholly owned by GREA, and now holds a 38.70% equity interest therein. In consideration for its subscription, Verdant assigned receivables amounting to US$26.7 million, which were previously owed by DH Ethiopia and DH Kenya, to DH Africa and a US$4.7 million convertible note, convertible into equity in DH Ghana. Following completion of the transaction, Grit, through GREA and DH Africa, has obtained control over DH Kenya in accordance with IFRS 10, and DH Kenya has been consolidated into the Group’s financial statements. This consolidation did not arise through the exchange of consideration but rather through changes to the governance structure of the broader diplomatic housing platform, which is now managed at the DH Africa level under a revised shareholder agreement. In accordance with the terms of this shareholder agreement, Grit through GREA exercises control as defined by IFRS 10 over DH Africa and its subsidiaries. DH Kenya was previously treated as an joint venture for the Group. The acquisition of DH3 did not constitute the acquisition of a business as the Group, having applied the optional concentration test concluded that the fair value of the gross asset was concentrated in a single identifiable asset being the investment property. The acquisition has resulted in the Group acquiring some incidental assets and liabilities. The previously held equity interest has not been re-measured but instead the Group has used a cost accumulation approach inaccordance with the section 1.5 of its accounting policy (disclosed in the annual financial statements section of the 2024 annual report) which resulted in no gain or loss being recognized upon stepping up from joint venture to subsidiary. Details of the assets and liabilities acquired as part of the asset acquisition of DH Kenya are:
As the acquisition was determined to be an asset acquisition, the Group applied the cost accumulation approach and adjusted the net assets acquired, specifically the investment property, so that the group of assets and liabilities assumed are recorded at the total consideration transferred. This resulted in a corresponding and equal fair value adjustment to the investment property, recognised as a gain, to reflect the corrected valuation of the property immediately following the acquisition. 10.2Transaction with non-controlling interest As previously disclosed, the transaction resulted in Verdant acquiring a 38.2% equity interest in DH Africa. As consideration for the shares subscribed in DH Africa, Verdant re-assigned receivables amounting to US$26.7 million to DH Africa. In the Group’s consolidated financial statements, US$21.7 million of this amount was classified as a liability under the financial statement line item “Proportional shareholder loans”, with the remaining US$5.0 million recorded under “Related party loan payable” as reflected in the table above. Verdant also granted DH Africa a convertible note with a principal amount of US$4.7 million, which is convertible into equity shares in DH Accra. Following the change in shareholding in DH Africa, the Group continues to consolidate all assets held within DH Africa. However, this change in shareholding has resulted in a change in the Group’s effective interest in the underlying assets held by DH Africa. This change has been accounted for as a transaction with non-controlling interests, in accordance with IFRS 10, without a change in control. The table below summarises the impact of this transaction on the equity attributable to the shareholders of the Group.
10.3 Acquisition of asset and development management contract As part of the overall transaction, Grit has issued 24.7 million new ordinary shares at an issue price of US$ 33.9 cents per share to acquire Verdant’s contractual rights to asset management and development management fees in respect of the diplomatic housing assets that transferred to DH Africa. Under the previous arrangement, Verdant was contractually entitled to receive these fees over the life of the diplomatic assets. Following this transaction, these rights have been ceded to Grit which in turn will be ceded to its subsidiary DHA Real Estate Management Ltd, enabling the Group to internalise these functions through its existing development and asset management platforms. In accordance with the requirements of IAS 38 – Intangible Assets, Grit has recognised an intangible asset in respect of these contractual rights, reflecting the Group’s control over the rights and its ability to generate future economic benefits through either the receipt of development and asset management fees, or through the avoidance of external costs that would have otherwise been payable to Verdant. As the future economic benefits arise from contractual rights, the asset meets the contractual-legal criterion for identifiability under IAS 38. The intangible asset has been recognised at a cost of US$8.3 million, representing the fair value of the consideration exchanged. The useful life of the asset has been determined to be 12.5 years, aligned with the adjusted average lease terms of the underlying assets held within DH Africa. The intangible asset will be amortised on a straight-line basis over this period through the income statement. The carrying amount will be subject to impairment testing should any indicators of impairment arise in accordance with IAS 36. 11. Non-current assets classified as held for sale In October 2024, the Group entered into a Share Purchase Agreement (“SPA”) for the disposal of its equity interest in St Helene Clinic Co Ltd (“St Helene”), the beneficial owner of Artemis Curepipe Hospital in Mauritius. The classification of this investment as held for sale was reassessed as at 30 June 2025 and remains appropriate. Furthermore, on 30 June 2024, the Group classified Mara Delta (Mauritius) Property Limited (“Mara Delta”), the beneficial owner of Tamassa Resort in Mauritius, as a disposal group held for sale. This classification was similarly reassessed as at 30 June 2025 and remains appropriate. The table below sets out the major classes of assets and liabilities of St Helene and Mara Delta that have been classified as held for sale as at 30 June 2025: Assets of disposal group classified as held for sale as at 30 June 2025
Consolidated segmental analysis The Group reports on a segmental basis in terms of geographical location and sector. Geographical location is split between Senegal, Morocco, Mozambique, Zambia, Kenya, Ghana and Mauritius, as relevant to each reporting period. Following the integration of Gateway Real Estate Africa within the Group the Geographical segment has been extended to now include Ethiopia, Mali, Uganda and Nigeria. The Group sectors are split into Hospitality, Retail, Office, Light industrial, Corporate Accommodation, Healthcare, Data Centre, Coporate, Development management and other investments.
Rental income stemming from the US Embassy represented approximately 19.3% of the Group’s total contractual rental income for the period, with Total Group 8.49%, Tamassa LUX 4.48%, CCI 4.14% and Vodacom Mozambique 4.04%, making up the top 5 tenants of the Group. 13.Basic and diluted LOSSES per ordinary share
16a. EPRA earnings Basis of Preparation The directors of GRIT Real Estate Income Group Limited ("GRIT") ("Directors") have chosen to disclose additional non-IFRS measures, these include EPRA earnings, adjusted net asset value, EPRA net asset value, adjusted profit before tax and funds from operations (collectively "Non-IFRS Financial Information"). The Directors have chosen to disclose:
EPRA Earnings
The condensed consolidated interim financial statements for the six months period ended 30 June 2025 (“abridged unaudited consolidated financial statements”) have been prepared in accordance with the measurement and recognition requirements of International Financial Reporting Standards (“IFRS”), the FCA Listing Rules and the SEM Listing Rules. The accounting policies are consistent with those of the previous audited annual financial statements. The Group is required to publish financial results for the six months ended 30 June 2025 in terms of SEM Listing Rule 15.44 and the FCA Listing Rules. The Directors are not aware of any matters or circumstances arising subsequent to the period ended 30 June 2025 that require any additional disclosure or adjustment to the condensed consolidated interim financial statements. These unaudited condensed consolidated interim financial statements were approved by the Board on 12 August 2025. Copies of the unaudited condensed consolidated interim financial statements, and the statement of direct and indirect interests of each officer of the Company pursuant to rule 8(2)(m) of the Mauritian Securities (Disclosure Obligations of Reporting Issuers) Rules 2007, are available free of charge, upon request at the Company's registered address. Contact Person: Ali Joomun. Forward-looking statements This document may contain certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. Actual outcomes and results may differ materially from any outcomes or results expressed or implied by such forward-looking statements. Any forward-looking statements made by, or on behalf of, Grit speak only as of the date they are made, and no representation or warranty is given in relation to them, including as to their completeness or accuracy or the basis on which they were prepared. Grit does not undertake to update forward-looking statements to reflect any changes in its expectations with regard thereto or any changes in events, conditions, or circumstances on which any such statement is based. Information contained in this document relating to Grit or its share price, or the yield on its shares, should not be relied upon as an indicator of future performance. Any forward-looking statements and the assumptions underlying such statements are the responsibility of the Board of directors and have not been reviewed or reported on by the Company’s external auditors. Dissemination of a Regulatory Announcement, transmitted by EQS Group. The issuer is solely responsible for the content of this announcement. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ISIN: | GG00BMDHST63 |
| Category Code: | FR |
| TIDM: | GR1T |
| LEI Code: | 21380084LCGHJRS8CN05 |
| Sequence No.: | 398544 |
| EQS News ID: | 2182448 |
| End of Announcement | EQS News Service |
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