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Sep 04, 2007:
A supplier of affordable housing is on track to list on the Alternative Exchange (AltX) of the JSE Limited by way of private placing and offer for sale on 20 September 2007.
The RBA Holdings listing will facilitate the provision of capital for further growth opportunities in this high growth market.
R65m will be raised in a private placing: 30m new ordinary shares will be offered for subscription by the company and 35m shares will be offered for sale by existing shareholders to add to the liquidity of the shares on the JSE.
"We are excited about listing on AltX and confident that the capital proceeds from the listing will enable us to increase our capacity to not only supply housing to our key target market, but also keep them affordable," David Wentzel, RBA Housing CEO, said.
The listing will also enable RBA to:
• Procure additional land for development • Pursue potential acquisition opportunities • Provide working capital
RBA's homes are differentiated from low cost housing in terms of size, cost and funding. RBA homes are typically 40sq m to 80 sq m and cost R250k to R700k. They have two or three bedrooms, one or two bathrooms, a lounge, kitchen, stove and carpets or tiles, with various options on the fittings.
RBA Developments, a subsidiary of RBA Holdings, also manages land procurement, legal, administration, project management and construction of all the group's operations.
There is currently a national shortage of about 650,000 homes in the affordable housing bracket. RBA has built more than 5,000 homes to date with another 600 currently under construction in their 20 project areas. RBA has a current capacity to deliver 1,200 houses per annum which is the expected output for 2008. The goal is to extend this capacity to 2,000 per annum.
"Estimates from the Banking Association of South Africa indicate that there is a need to build 132,000 affordable houses a year, which the banks are prepared to finance to meet their Financial Services Charter commitment," Wentzel added.
RBA's 2006 revenue was R176m with profit attributable to ordinary shareholders at R19m. Forecast revenues for 2007 are R235m and R306m for 2008. Profit attributable to ordinary shareholders is forecasted at R35m and R46m in 2007 and 2008 respectively.
