Listed property loan stock company Spearhead Property Holdings Ltd (SPE) has reported a 43% rise in its headline earnings per linked unit for the six months to end-December 2004 to 117.55 cents from 82.32 cents a year earlier.

The group declared an interim distribution per linked unit of 95 cents, versus 80 cents at the midway point a year earlier.

Spearhead said revenues had risen 23% to 50.4 million rand from 41.32 million rand in the previous year, while net asset value per linked unit improved 23% to 14.36 cents versus 11.64 cents a year earlier.

Profit from operations stood at 25.88 million rand, representing a 27% increase on the 20.36 million rand reported previously.

Commenting on the results, Spearhead described the six month period as "exceptionally favourable", helped by rising levels of rental income and other operating income. Rental income had exceeded budget, with turnover contributions from retail tenants providing much of the lift.

Good savings had been achieved in maintenance costs, but these were offset somewhat by additional marketing costs and higher staffing costs resulting from an expanded scale of operations. Interest rate declines had also helped to lower borrowing costs, the group noted.

Spearhead was ranked as the top-performing listed real estate company in South Africa for the 2004 calendar year, based on total returns to linked unit holders (measured by distributions plus growth in the value of its linked units).

The company also revealed that, as part of its black economic empowerment plans, it has introduced three new BEE shareholders into the company, which together with other existing black shareholders will hold more than 25% of Spearhead's total equity.

The new BEE shareholders are Ngatana Properties, Abu Varachhia and the Public Investment Commissioners (PIC).

"This represents a major and early step forward for Spearhead in meeting the objectives of the awaited charter for the property industry," it said.

"The directors are pleased to welcome the new shareholders to the company, where their expertise and experience within the industry and with policy issues will be invaluable. Lance Manala and Abu Varachhia will shortly be appointed to the board of Spearhead."

Looking ahead, Spearhead said it was projecting "another good year", to which it had already had a strong start.