PrimeTime, the BSE-listed diversified property group, expects to retire a significant portion of debt as it advances its multi-year balance sheet strategy. The expected debt reduction will be funded through retained distributable income and proceeds from announced property disposals which totals P98.4 million gross.
To accelerate this progress, the Board does not expect to declare a distribution for the financial year ending 31 August 2026. The retained cash will be directed towards reducing borrowings at a time when the cost of debt remains elevated, strengthening the financial base from which future distributions can be supported.
PrimeTime Chairman Paul Masie said the decision reflected the Board’s approach to allocating capital where it can create the greatest long-term value for unitholders.
“This capital allocation approach prioritises balance sheet strength and financing resilience over near-term distributions. The Board believes this is the most appropriate use of available cash while borrowing costs remain elevated and the Group continues to execute its deleveraging strategy,” he said.
PrimeTime’s most recently published financial results reflected resilient underlying property performance. For the six months ended 28 February 2026, revenue increased by 4% to P122.1 million and portfolio vacancy was 2% at the reporting date.
The economic case for reducing debt has strengthened as borrowing costs have increased. At 28 February 2026, PrimeTime’s weighted average cost of debt was 9.2%, compared with 7.9% at 31 August 2025, while finance costs for the six-month period increased by 9% to P38.8 million. Reducing higher-cost borrowings lowers future interest expense and refinancing exposure.
“The question for the Board is where each pula of capital creates the greatest value for unitholders. At current borrowing costs, using retained cash to reduce debt produces an immediate financial benefit, lowers future interest expense and strengthens PrimeTime’s capacity to support sustainable distributions over time,” Mr Masie said.
“This is a deliberate continuation of the balance sheet strategy we have pursued over several years. The objective is to strengthen the financial platform of a resilient property business and give PrimeTime greater flexibility to invest selectively where returns justify the capital.”
Botswana’s funding environment has also become more expensive. The Bank of Botswana reported headline inflation of 9.4% in July 2026, above its 3%-6% medium-term objective range, while the Monetary Policy Rate stood at 5.5% in the latest published data. These conditions reinforce the Board’s existing focus on disciplined capital allocation.
PrimeTime has already made substantial progress in reducing gearing. The Group’s LTV reached approximately 59% at the February 2022 interim reporting point and had declined to 43% by February 2026. Subject to successful execution of the current initiatives, the Board expects LTV to reduce further to approximately 39%-42%.
A sub-40% LTV is widely regarded by listed property investors as an important measure of balance-sheet resilience, providing greater protection against property value movements and greater flexibility when refinancing debt.
The expected full-year non-declaration is consistent with the capital allocation approach communicated at the February 2026 half-year. Distribution capacity will continue to be assessed against gearing, funding conditions, liquidity requirements and operating cash generation, without committing to a specific timetable.
PrimeTime continues to invest selectively in assets and developments supported by identifiable tenant demand while progressing selected property disposals. The Board’s objective is to preserve the quality and income-generating capacity of the retained portfolio as the balance sheet strengthens.
PrimeTime will provide further information on its financial performance, balance sheet and progress against its capital allocation priorities when it reports its results for the year ended 31 August 2026.