Far East Hospitality Trust DPU Rises for 1Q2016

Far East Hospitality Trust Logo

On 27th April 2016, Far East Hospitality Trust announces its 1Q2016 financial results. Gross revenue remains flat at S$27.4 million. Net property income increase slightly by 0.8% from S$24.5 million to S$24.7 million. A Distribution Per Unit (“DPU”) of 1.08 cents was declared which is a 0.9% increase as compared to 1.07 cents in 1Q2015.

The slight 1.9% increase in distribution amount was due to the slight increase in tourist arrivals in the first two months of the year.

1Q2016
(S$’000)
1Q2015
(S$’000)
YoY(%)
Gross Revenue 27,365 27,365 0
Net Property Income 24,679 24,487 0.8
Distributable Amount 19,444 19,203 1.3
Distribution Per Unit (“DPU”) (cents) 1.08 1.07 0.9

Occupancy

Far East Hospitality Trust Occupancy 1Q2016

Hotels

Singapore held the biennial Singapore Airshow earlier this year which provided some uplift. However, the hospitality sector still appears weak due to lack of corporate demand. Revenue per available room (“RevPAR”) was flat at S$141.

Serviced Residences

Revenue per available room (“RevPAR”) for serviced residences fell 8.7% to S$188. This was due to weaker demand as well.

Debt Maturity Profile

$50 million of Far East H-Trust’s floating-rate debt was hedged, increasing the proportion of debt secured at fixed interest rates to 65% from 59%. The current weighted average debt to maturity is 3 years.

Catalyst

Personally, my opinion for the catalyst of Far East Hospitality Trust will be the increase in international visitor arrivals. More international events held in Singapore can boost international visitor arrivals.

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