RDI holds onto dividend amid rental shortfall

London and JSE-listed landlord RDI is engaging with tenants after receiving about half of what it was due from European tenants in April.

The group, which has a portfolio £1.33bn (R30bn) is facing arrears as retailers shut stores due to the Covid-19 pandemic, adding additional pressure to a UK retail sector already hit in recent years from Brexit uncertainty.

Rents collected for the month of April were 53.2% of the group’s European portfolio, “with a significant proportion of the reduced collection rate, when compared to March, attributable to a limited number of large, well-capitalised international retail tenants, which have unilaterally withheld payment that remains due and payable,” RDI said.

Across the group’s portfolio, about 59% of gross rental income was collected for either the March quarter or the month of March, where rents are billed monthly, RDI said.

“Over the last few weeks, we have been focused on actively engaging with our tenants and taking necessary pragmatic actions across the business to ensure that we are best equipped to withstand this challenging period,” CEO Mike Watters said.

RDI reported that its loss in its six months to end-February widened to £17.6m (R397.76m) from £3.3m previously, with the group holding on to its dividends to preserve cash.

In the prior six month period, RDI had paid an interim distribution of 4p per share and currently has about 380-million shares in issue, meaning it would have paid about R340m if it kept its dividend unchanged.

In morning trade on Monday, RDI’s share was up 1.15% to R11.48, having fallen 4.56% so far in 2020.