Mapletree Commercial Trust Declares DPU of 2.31 cents for 4QFY18/19

I consider this as one gem I have in my stock portfolio. Mapletree Commercial Trust currently makes up 10% of my stock portfolio. On 23rd April 2019, Mapletree Commercial Trust announced their 4QFY18/19 financial results. 4Q FY18/19 gross revenue and Net Property Income (NPI) grew 3.7% and 3.9% respectively. Income available for distribution was up 3.1%.

Here are the 4QFY18/19 financial results compared with 4QFY17/18.

4QFY18/19
(S$’000)
4QFY17/18
(S$’000)
Change
Gross Revenue 112,899 108,880 3.7%
Net Property Income 87,560 84,285 3.9%
Distributable Income 66,861 64,839 3.1%
Distribution Per Unit (“DPU”) (cents) 2.31 2.27 1.8%

All financial results are positive!

Here are the full year FY18/19 financial results compared with FY17/18.

FY18/19
(S$’000)
FY17/18
(S$’000)
Change
Gross Revenue 443,893 433,525 2.4%
Net Property Income 347,627 338,845 2.6%
Distributable Income 264,027 260,359 1.4%
Distribution Per Unit (“DPU”) (cents) 9.14 9.04 1.1%

Debt

As of 31st March 2019, the gearing ratio stood at 33.1%. The average term to maturity of debt is 3.6 years.

Occupancy

Overall portfolio committed occupancy stood at 98.5%.

Dividend Yield

Based on the dividend payout of 9.14 cents and current stock price of $1.92, this translates to a dividend yield of 4.76%. This means Mapletree Commercial Trust is considered expensive right now as most retail REITs should offer a dividend yield above 5%.

Catalyst

Giant at the basement has been replaced by FairPrice. FairPrice has started fit-out works for an integrated space of estimated 91,000 square feet while the remaining estimated 24,000 square feet of recovered anchor space on Level 1 and Basement 2 has been fully committed. The enhancement work is scheduled for completion by 2Q FY19/20, the entire changeover will deliver estimated 40% Return On Investment (ROI) in addition to positive rental uplift.

Frasers Logistics and Industrial Trust Declares DPU of 1.76 cents for 2QFY19

Frasers Logistics and Industrial Trust currently makes up 14% of my stock portfolio and 20% of my wife’s stock portfolio.

On 26th April 2019, Frasers Logistics and Industrial Trust announced their 2QFY19 financial results. The manager has declared a Distribution Per Unit (“DPU”) of 1.76 cents. This was a 2.8% decline as compared to 1.80 cents in 2QFY18. If we looked at the Distribution Per Unit (“DPU”) in Australian cents, the Distribution Per Unit (“DPU”) was 1.82 cents as compared to 1.70 cents in 2QFY18 which was 7.1% higher.

The reason for lower Distribution Per Unit (“DPU”) in Singapore cents was because of the softening of AUD and EUR against the SGD. The exchange rate was A$1.00: S$0.9666 (2QFY18: A$1.00:
S$1.0647). 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.

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. I liked the annual average rent increment baked into its Australia assets.

As of 31 March 2019 Australia Europe Total
Number of properties 60 22 82
WALE 6.43 years 7.08 years 6.61 years
Occupancy Rate 99.4% 100% 99.6%
Annual Average Rent Increment 3.1% CPI-linked/ Fixed N.A

Debt

As of 31st March 2019, Frasers Logistics and Industrial Trust’s aggregate leverage was 35.1%. This was 0.5% down from 35.6% as compared to 1QFY19. The average weighted debt maturity is 2.4 years.

2QFY19 Financial Results

2QFY19
(A$’000)
2QFY18
(A$’000)
Change
Gross Revenue 59,666 43,575 36.9%
Net Property Income 47,866 33,414 43.3%
Distributable Income 36,909 25,866 42.7%
Distribution Per Unit (“DPU”) (Australian cents) 1.82 1.70 7.1%
Distribution Per Unit (“DPU”) (Singapore cents) 1.76 1.81 (2.8)%

Last but not least, it was interesting to know from the presentation slides that E-commerce can be a driver of global logistics market.

  • E-commerce is a key driver behind the development of the global logistics market, which is boosting demand for Logistics and Industrial properties and encouraging new project developments
  • Online retail sales (as percentage of total retail sales) is expected to grow exponentially in the years to come
  • Very strong demand growth has cut the availability of large-scale modern warehouse space, producing capacity constraints in several major logistics hubs globally
  • Growing customer expectations for same-day and same-hour delivery are forcing an increasing number of courier, express and parcel service providers to seek new centres for last mile city distribution.

Capitaland Mall Trust Annual General Meeting (2018 Overview)

Capitaland Mall Trust has just held their Annual General Meeting (AGM) on 11th April 2019. Capitaland Mall Trust currently makes up 11% of my stock portfolio. Basically, they are covering an overview of 2018. FY18 financial highlights from the Annual General Meeting (AGM) includes the increase of distributable income to S$410.7 million, increase of distribution per unit to 11.50 cents and increase of Net Asset Value (NAV) to S$2.02.

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%

Occupancy Rates

Occupancy stood at 99.2% which you can find from their presentation slides below. Annual Shopper Traffic has declined slightly by 0.9% which is not too worrying and based on this figure, we can see how strong malls under Capitaland Mall is able to continue to attract shoppers despite the threat of the growing trend towards online shopping.

It is note worthy to mention how CapitaMalls attract shoppers via their shoppers reward program such as earning CapitaStars for spending at its malls where shoppers can use their rewards points to redeem CapitaMall vouchers. This has kept shoppers returning to their malls to spend.

Debt

The gearing ratio currently stood at 34.2% with 89.8% of the assets unencumbered. 13 properties are wholly owned, directly and indirectly under Capitaland Mall Trust with the exception of Westgate. You can find more details on the acquistion of Westgate here.

Redevelopment of Funan

Funan Centre

I have mentioned that the re-opening of Funan that can be a possible catalyst of CapitaMall Trust. The redeveloped Funan (Six storey retail mall, two office towers and one block of serviced residence) is targeted to re-open in mid 2019. Including leases under active negotiations, leasing has reached more than 80%.

Current Dividend Yield

The same question comes into our mind. Should you buy Capitaland Mall Trust now? Based on the distribution per unit of 11.5 cents and current price of S$2.39, this translates to a dividend yield of 4.81%. I will give it a miss if I am not yet vested as I am targeting for a dividend of above 5% for REITs.

The REIT is also current trading above its Net Asset Value (NAV) of S$2.02. The current price is 18.3% above premium to its NAV.