Letlole La Rona’s profit before tax fell 51% to P40.6 million for the six months ended December 2025, as higher finance costs and a negative revaluation of investment properties offset steady rental income growth.
The property group grew revenue by 7% year-on-year to P106.9 million, supported by lease escalations averaging 6% to 8% and strong portfolio occupancy of 97%. This reflects continued resilience in its core rental business despite a challenging macroeconomic environment affecting tenants.
However, profitability was dragged down by a P4.5 million fair value loss on investment properties, a sharp reversal from a P35.3 million gain in the prior period, following changes in valuation assumptions and rising capitalisation rates. At the same time, finance costs rose 14% to P28.9 million due to higher interest rates, further compressing earnings.
While operating profit remained broadly flat at P64.9 million, the combined impact of valuation losses and financing pressures led to total comprehensive income declining to P42.2 million from P79.0 million a year earlier. Earnings per linked unit dropped to 15.08 thebe from 29.61 thebe.
The group maintained a strong balance sheet, with total assets increasing to P2.2 billion, driven largely by its investment property portfolio valued at over P1.8 billion. Cash balances also improved significantly to P65 million from P16.7 million, supported by financing inflows during the period.
Despite the earnings decline, Letlole La Rona declared an interim distribution of 4.40 thebe per linked unit, down 30% year-on-year, as the company prioritised liquidity preservation amid tightening financial conditions.
Management said the operating environment remains fragile, citing pressures from Botswana’s diamond-dependent economy, rising borrowing costs and constrained liquidity, but expects to maintain stable occupancy and collection rates while pursuing capital raising and refinancing initiatives to support future growth.