Spearhead Property Holdings, the property loan stock company that for the last four years has consistently been among the top performers in this sector on the JSE Securities Exchange, has, in keeping with the Exchange’s rulings, published a cautionary trading update two weeks ahead of announcing its interim results.

The notice told shareholders that earnings for the six months ended 31 December will be significantly increased – by 10 to 30% on the same period last year.

Chief Executive, Mike Flax said that he was "very satisfied" with the company’s performance. Although the cautionary announcement did not give reasons for the increased earnings, Flax said that those who have assumed it to be due to a combination of successful trading activities and the substantially lower interest rates would be in the main be correct – and, he added, Spearhead’s increasing emphasis on the Western Cape, where today 95% of their portfolio is situated, has very definitely paid off.

Flax said that he is now more than ever convinced that an "internally managed" property group like Spearhead where the management and directors objectives are "totally congruent" with those of the shareholders is likely to outperform any externally managed property fund.

In a previous statement Flax outlined Spearhead’s policy in this respect.

"We were determined," he said, "from the outset that there was never to be a conflict of interest between the management group and the company they served – and this remains our policy."

Looking ahead, Flax said that a number of "worthwhile" projects will be brought to completion in the next 24 months and these are likely to help Spearhead maintain its upward profit trend.

He stressed, however, that although Spearhead has now gained a name as a developer and trader, their primary aim is still to build up a portfolio of top property stock like the Spearhead Business Park at Montague Gardens, some of it developed by themselves, on which returns can be relied on to improve year by year.

The publication of Spearhead’s interim profits is scheduled to take place on or about the 12th February 2004.

For further information contact Mike Flax on 021 425 1000.