CapitaMall Trust 3Q2020 Financial Results

CapitaMall Trust

CapitaMall Trust 3Q2020 Financial Results have been released on 22nd October 2020. CapitaMall Trust makes up 9.70% of my stock portfolio. During the stock market crash, I have added more of CapitaMall Trust given my confidence in CapitaMall Trust.

How is CapitaMall Trust coping with the COVID-19 recovery? Let us take a look at the latest 3Q2020 financial results.

In 3Q 2020, CapitaMall Trust’s Gross Revenue and Net Property Income (“NPI”) decreased by 25.3% and 27.6% year-on-year respectively. This was mainly due to rental waivers of S$29.5 million granted by CapitaMall Trust to tenants affected by COVID-19, as well as lower other income and rental on gross turnover.

CapitaMall Trust also released S$36.4 million, part of the S$46.4 million of taxable income available for distribution retained in 1H 2020 to Unitholders. In 3Q 2019, CapitaMall Trust released S$1.5 million of its taxable income available for distribution retained in 1H 2019 to Unitholders.

In terms of operational performance, rental reversion fell 4.4%. Shopper traffic declined much as 40.4%. With less shopper traffic, it is inevitable that tenant sales per square foot fell 13.9%.

CapitaMall Trust 3Q2020 Financial Results

3Q2020
(S$’000)
3Q2019
(S$’000)
YoY(%)
Gross Revenue 150,277 201,111 (25.3)
Net Property Income 104,449 144,222 (27.6)
Distributable Amount 114,294 112,973 1.2
Distribution Per Unit (“DPU”) (cents) 3.10 3.06 1.3

Occupancy

As of 30th September 2020, the average portfolio occupancy stood healthy at 98.0%.

CapitaMall Trust Occupancy 3Q 2020

Debt

As of 30th September 2020, the gearing ratio stood at 34.4%. 100% of CapitaMall Trust’s assets remain unencumbered.

Current Dividend Yield

Based on the historical payout of 11.97 cents in FY19 and current share price of S$1.89, this translates to a current dividend yield of 6.33%.

Year to date September 2020, DPU of 6.06 cents have been paid as compared to 8.86 cents (YTD September 2019). Investors should expect the FY20 full year DPU to be lower due to the impact of COVID-19.

CapitaMall C38U Share Price 23 Oct 2020

Summary

The merger between CapitaMall and CapitaLand Commercial Trust was approved on 29th September 2020. CapitaLand Commercial Trust will be delisted on 3rd November 2020 and CapitaMall Trust will be renamed to CapitaLand Integrated Commercial Trust.

Based on the latest operational performance and 3Q2020 financial results, the headwinds due to COVID-19 can be deeply felt. Cautious consumer sentiment was evidenced by the muted retail sales in August. Even though CapitaMall has embarked on omnichannel retailing, there is still much to do as online sales as a proportion of total retail sales was only 10.9% in August 2020.

At current dividend yield of 6.33%, this is still deemed attractive to me if you are intending to hold CapitaMall Trust for the longer term. I doubt DPU will recover in the short term since many COVID-19 restrictions are still in placed and international borders remained closed.

Now, the magic question. Can you buy CapitaMall Trust now?

I will advice to buy in small lots because COVID-19 has changed the way we live our lives such as shopping and dining. CapitaMall Trust is still an excellent REIT to invest in given the excellent location of its suburban malls.

I am betting on the recovery of the retail sector.

Singlife Grow Investment Linked Plan

Singlife Grow Investment Linked Plan

Singlife Grow is a newly launched product (investment-linked plan) that is available via the Singlife App. The aim is to allow you to invest and insure directly on your Singlife App.

If you have followed my blog, you will know that I stash away my spare cash into the Singlife account for the higher return of 2.0% p.a. as compared to traditional saving accounts or fixed deposits.

Singlife has taken the money management game further with Grow.

What is Grow?

Singlife has teamed up with Aberdeen Standard Investments to introduce a investment-linked plan (ILP) called Grow. 3 discretionary managed model portfolios (Conservative, Balanced and Dynamic) are offered under the plan for customers with different risk profiles.

As you can see below, the risk profile is based on the percentage allocation of Equities versus Fixed Income. By the nature of the financial instrument, Equities are riskier than Fixed Income (bonds and short term bank deposits).

Singlife Grow

Since what you are buying into are actually funds, you will be able to find under each fund:

  • The Fund Fact Sheet
  • Product Highlight Sheet
  • Prospectus

Below are the composition of the funds under each underlying portfolio.

Conservative (19.91% Equities, 80.09% Fixed Income)

Singlife Grow Conservative Funds

Balanced (49.93% Equities, 50.07% Fixed Income)

Singlife Grow Balanced Funds

Dynamic (79.95% Equities, 20.05% Fixed Income)

Singlife Grow Dynamic Funds

What Are The Benefits of Singlife Grow?

Quick start

Start from a low initial premium of S$1,000. You can make a hassle-free payment via your Singlife Account.

Managed by experts

Curated investments by a team of professionals from Aberdeen Standard Investments.

No lock-in period

Make a withdrawal anytime without charges.

Simplified charge

Only a management charge of 0.25% on your account value every quarter. No sales charge, transaction fee, withdrawal fee or any other charges.

Investment that protects

Get insurance protection. The death benefit will be the higher of:

  • 101% of net premiums; or
  • Account value

Summary

Singlife really makes it easy for one to start investing with their mobile app. The below table sums it up.

Plan Conservative Balanced Dynamic
Risk Low Medium High
Equities versus Fixed Income % 19.91% Equities, 80.09% Fixed Income 49.93% Equities, 50.07% Fixed Income 79.95% Equities, 20.05% Fixed Income
Recommendation
  • You are just starting your journey with investing.
  • You prefer taking on less risk.
  • You are comfortable with lower returns.
  • You have a moderate risk tolerance.
  • You seek a modest return on your investment.
  • You are comfortable with some volatility in return for a potentially higher investment performance.
  • You have a high risk tolerance.
  • You are comfortable with managing significant fluctuations with your investments, in return for potentially higher returns over the long term.

Disclaimer: This is not a sponsored post and solely the author’s opinion.