Summary of January 2019 Transactions

We are at the end of the first month of the year 2019. There are no major changes to my stock portfolio this month except for the regular monthly purchase of Singapore Savings Bonds. It will be exciting next month as we can use our monies in Supplementary Retirement Scheme (“SRS”) funds to purchase Singapore Savings Bonds with effect from 1st February 2019!

This month, I attended a two day seminar (Alpha Summit) organized by The Fifth Person. The event was packed with lots of contents where they share with us the importance of free cash flow etc. Moving forward, I shall try to practice the things I learnt at the seminar in my stock analysis of companies I am interested in.

A few companies in my stock portfolio had released their financial results recently. It was surprising for me that CapitaMall Trust has done well in terms of DPU growth and disappointing for Frasers Logistics and Industrial Trust due to lower DPU because of a weaker foreign exchange between Australian dollar and Singapore dollar.

CapitaMall Trust DPU for 4Q2018 is 2.99 Cents

Frasers Logistics and Industrial Trust Declares Lower DPU in Singapore Cents

The US government has re-opened after a 15 days shutdown. Last night, the Fed has also highlighted that interest rate hikes may potentially slow down. This is a pretty much good news for REITs and the global stock market.

That’s all for January updates!

Frasers Logistics and Industrial Trust Declares Lower DPU in Singapore Cents

Frasers Logistics and Industrial Trust announced their 1QFY19 financial results on 24th January 2019. The manager has declared a Distribution Per Unit (“DPU”) of 1.78 cents. This was a 1.1% decline as compared to 1.80 cents in 1QFY18. If we looked at the Distribution Per Unit (“DPU”) in Australian cents, the Distribution Per Unit (“DPU”) was 1.81 cents as compared to 1.70 cents in 1QFY18.

The reason for lower Distribution Per Unit (“DPU”) in Singapore cents was because of a lower average hedged rate for 1QFY2019 at A$1.00 :S$0.9820. Foreign exchange risk is one key risk when investing in Frasers Logistics and Industrial Trust and I am fully aware of this risk prior to investing.

Two leases in Victoria, Australia were renewed during the quarter. The two leases will have annual fixed rental increases of 3.0% and 3.5% respectively which benefit Frasers Logistics and Industrial Trust in the long run.

Occupancy

Frasers Logistics and Industrial Trust’s portfolio remained at near full occupancy of 99.6%, with a weighted average lease expiry (“WALE”) by gross rental income (“GRI”) of 6.71 years.

Debt

Frasers Logistics and Industrial Trust’s aggregate leverage was 35.6%.

1QFY19 Financial Results

1QFY19
(A$’000)
1QFY18
(A$’000)
Change
Gross Revenue 59,524 42,430 40.3%
Net Property Income 48,930 33,391 46.5%
Distributable Income 36,698 25,854 41.9%
Distribution Per Unit (“DPU”) (Australian cents) 1.81 1.70 6.5%
Distribution Per Unit (“DPU”) (Singapore cents) 1.78 1.80 (1.1)%

In 2018, Frasers Logistics and Industrial Trust has been very active in divesting and new acquisitions. You can read more of them here:

Frasers Logistics and Industrial Trust Divests 80 Hartley Street Asset

Frasers Logistics and Industrial Trust Divests Lot 102 Coghlan Road In South Australia

Frasers Logistics and Industrial Trust Acquires NSW Property and QLD Property

CapitaMall Trust DPU for 4Q2018 is 2.99 Cents

CapitaMall Trust has announced their 4Q2018 financial results on 23rd January 2019. It was quite amazing CapitaMall Trust is still able to increase its distribution per unit (“DPU”) quarter on quarter. Distribution per unit (“DPU”) for 4Q2018 was 2.99 cents, 3.1% higher than the Distribution per unit (“DPU”) of 2.90 cents for 4Q2017. Based on CapitaMall Trust’s closing price of S$2.27 per unit on 22 January 2019, the annualised distribution yield for 4Q2018 was 5.22%.

According to the presentation slides that was released by CapitaMall Trust, most of the asset enhancement works that are ongoing last year has been completed.

Here are more details on the assets updates:

  • March – Completed the mall interior rejuvenation works of Raffles City Singapore
  • 18 June – Completed the sale of Sembawang Shopping Centre
  • October – Completed the rejuvenation works of Tampines Mall
  • 1 November – Completed the acquisition of balance 70.0% stake in Westgate (the “Acquisition”)
  • December – Completed the asset enhancement works of Westgate

100% of the assets used to be unencumbered as of 30th September 2018. As of 31st December 2018, only 89.8% of the assets are unencumbered due to Westgate. S$405.0 million secured bank loans by Infinity Mall Trust due in October 2019.

Overall portfolio occupancy stood at a healthy level of 99.2%.

4Q2018 Financial Results

4Q2018
(S$’000)
4Q2017
(S$’000)
Change
Gross Revenue 180,464 172,402 4.7%
Net Property Income 124,425 119,258 4.3%
Distributable Income 108,137 102,933 5.1%
Distribution Per Unit (“DPU”) (cents) 2.99 2.90 3.1%

FY2018 Results

DPU for FY2018 was 11.50 cents, 3.0% higher than FY2017.

FY2018
(S$’000)
FY2017
(S$’000)
Change
Gross Revenue 697,521 682,469 2.2%
Net Property Income 493,548 478,234 3.2%
Distributable Income 410,675 395,824 3.8%
Distribution Per Unit (“DPU”) (cents) 11.50 11.16 3.0%