SPH REIT 1QFY20 Financial Results

The share price of SPH REIT has came down recently from S$1.07 to S$1.03. This has got me worried whether if I missed any bad news on SPH REIT which caused the share price to be on a downtrend. If you are aware of any, please post in the comments below. I have also noticed that I have not reviewed SPH REIT’s 1QFY20 financial results that was released on 10th January 2020.

Investors should know that COVID 19 is not a long term situation but such short term situation does cause panic in the stock market. We all know that retails REITs are impacted by the current COVID 19 situation but could there be any bad news that I have missed for SPH REIT that affects the fundamentals?

Let us take a quick look at SPH REIT’s 1QFY20 financial results.

1QFY20 Financial Results

1QFY20
(S$’000)
1QFY19
(S$’000)
Change
Gross Revenue 60,137 53,805 11.8%
Net Property Income 46,964 41,786 12.4%
Distributable Income 35,800 34,602 3.5%
Distribution Per Unit (“DPU”) (cents) 1.38 1.34 3.0%

Occupancy

Total portfolio occupancy stood at 99.3% which is very healthy.

Debt

The gearing ratio stood at 26.8% as compared to 27.5% in 4QFY19. One of the positives for SPH REIT is that its debt level is very low as compared to other REITs.

Current Dividend Yield

Like I have shared, the share price has came down due to the current COVID 19 situation. Based on the historical dividend of 5.6 cents and current share price of S$1.03, this translates to a current dividend yield of 5.44%.

My Opinion

A quick check shows that the fundamentals of SPH REIT is still intact. This means crisis such as COVID 19 poses an opportunity to buy into SPH REIT when its share price starts to fall because of panic in the market. Of course I believe there will be disruptions due to the fell in tourist and shoppers at its malls but this should be short term.