CapitaMall Trust 1Q2020 Financial Results

CapitaMall Trust 1Q2020 Financial Results

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.

On 30th April 2020, CapitaMall Trust has released their 1Q2020 financial results. How does the CapitaMall Trust fare? Let us take a look at the latest financial results.

For 1Q 2020, gross revenue improved by 6% to S$204.3 million as compared to 1Q2019. Net property income (“NPI”) improved 5.9% to S$148.3 million.

For 1Q 2020, in view of the uncertainty and challenges brought about by the rapidly evolving COVID-19 pandemic, CapitaMall Trust had retained S$69.6 million of its taxable income available for distribution to Unitholders. In addition, capital distribution of S$4.8 million for the period from 14 August 2019 to 31 December 2019 received from CapitaLand Retail China Trust in 1Q 2020 had been retained for general corporate and working capital purposes.

Thus, despite revenue growth and improved NPI, distribution per unit fell by 70.5% to 0.85 cents as compared to 2.88 cents that was paid in 1Q2019.

1Q2020 Financial Results

1Q2020
(S$’000)
1Q2019
(S$’000)
YoY(%)
Gross Revenue204,296192,7226.0%
Net Property Income148,300140,0985.9%
Distributable Amount (Before Capital Retention)106,007106,293(0.27%)
Distributable Amount (After Capital Retention)31,592106,293(70.3%)
Distribution Per Unit (“DPU”) (cents)0.852.88(70.5%)

Occupancy

The average portfolio occupancy stood healthy at 98.5%. With the COVID-19 temporary measures in place, landlords will not be able to terminate the lease of tenants or claim back the rented premises if the tenant is unable to pay the rent during the relief period of 6 months.

The manager of CapitaMall Trust will pass on the full savings from the property tax rebates granted by the government to tenants. On top of this, the manager had provided 100% rental rebates in April and May 2020 for almost all retail tenants. There is also additional rental waiver from 27 – 31 March for tenants ordered to close their premises by Ministry of Health since 27 March 2020.

With all these support to tenants in placed by CapitaMall, I can see that this has a positive effect of keeping the occupancy healthy.

CapitaMall Trust 1Q2020 Financial Results

Debt

As of 31st March 2020, the gearing ratio stood at 33.3%. If you are not aware, 100% of CapitaMall Trust’s assets are unencumbered.

Current Dividend Yield

Based on the historical payout of 11.97 cents in FY19 and current share price of S$1.85, this translates to a current dividend yield of 6.47%.

CapitaMall Trust 1Q2020 Financial Results

Summary

As of now, CapitaMall Trust is purely a retail REIT play. COVID-19 has change how malls operate and I believe even after “Circuit Breaker”, certain restrictions will permanently be there. An example will be limiting the number of shoppers for malls after “Circuit Breaker”.

On a positive note, CapitaLand Commercial Trust will be merging with CapitaMall Trust. After the merger, CapitaMall Trust will be a mixture of retail and office play. Post merger, this may cushion some of the impact of COVID-19 pandemic on the retail segment.

At current dividend yield of 6.47%, this is deemed attractive to me. However, as we are still in the midst of the COVID-19 pandemic, I will advice to buy in small lots because nobody can foresee the depth of the financial impact created by the COVID-19 pandemic.

I shall continue to monitor the financial results in the upcoming quarters

Screening For Dividend Stocks In April 2020

Screening For Dividend Stocks In April 2020

Last month, the stock market had crashed due to the impact of COVID-19. Since then, the stock market has started its recovery when news of government from different countries started to provide stimulus budget to revive the economy. During the crisis, I have picked up OCBC Bank, Singtel, US Manulife REIT and added more of CapitaMall Trust when their stock prices fell. If you didn’t know, I am a dividend investor. Thus, I usually look out for stocks with attractive dividend yield that provides me with endless dividends many years ahead. The stock market crash has provided me with such an opportunity.

I will run the Stocks Café stock screener every month which gives me a list of stocks that fulfill my dividend criteria. I fall into the medium risk type of investor and thus I never looked at stocks with dividend yield more than 10%. Below are the criteria that I used to identify dividend stocks.

  • Current Yield (%) >= 5 and <= 10
  • Price / Earnings <=20
  • Price / Book <= 3
  • Market Capitalization >= 1B

Below are the top dividend yielding stocks as of 10th April 2020. I believe you will see some REITs that you have been eyeing for before the stock market had crashed. Even though the stock prices have started the recovery, the current yield is still attractive.

NameCurrent Yield %P/EP/BMarket Cap
Mapletree NAC Trust9.9814.440.6112.8B
OUE Commercial REIT8.71113.380.6182B
Ascendas-iTrust8.6445.291.0841.4B
DBS7.8377.650.99848.7B
Frasers Logistics and Industrial Trust7.5689.050.9742.1B
CapitaRetail China Trust7.5578.460.8451.6B
Frasers Commercial Trust7.3857.910.7941.2B
Suntec REIT7.379.210.6053.6B
CapitaMall Trust7.1258.890.7986.2B
Ascendas REIT7.03817.71.2910.1B
Yanlord Land6.7332.970.3582B
ComfortDelgro6.52712.251.2523.2B
Frasers Centrepoint Trust6.2759.410.872.2B
UOB6.1977.740.84933.4B
SIA Engineering6.1810.441.292B
CapitaCommercial Trust6.08212.770.7845.6B
SPH REIT6.08111.840.7862.1B
TCIL HK$6.04417.20.3293.7B
SATS5.93815.92.2113.6B
OCBC Bank5.9227.910.86339.4B
Jardine Cycle & Carriage5.8336.710.8758.1B
Mapletree Commercial Trust5.5955.450.9555.6B
Yangzijiang Ship Building5.4355.90.6013.6B
Guocoland5.3855.720.3741.4B
Olam International5.2089.010.8524.6B
SPH5.19512.190.722.5B
Frasers Property5.1287.320.4533.4B
Lonza5.0425.720.6595.9B

Last, I just want to mention again that the above list is for reference only and we should do our homework before buying into the stock simply for the dividend yield.

REITs Limited Time Offer!

REITs Limited Time Offer!

The Federal Reserve announced that it will cut interest rates to zero as part of its emergency measure to protect the economy from the impact caused by the COVID-19 virus. I thought that this will give the stock market a boost but it didn’t. The stock market plunged further and this makes REITs certainly a lot cheaper at ridiculous prices I have never seen before.

Below are the stocks that I currently held in my stock portfolio. With the dip in stock prices, the current dividend yield had increased which makes certain REITs very attractive. Do expect further downside and do not expect recovery that soon. For long term dividend investors, this should not be much of an issue.

I will probably wait for the stock market to hold steady at current levels before deploying more tranches of my cash.

Stock NameTotal Dividends Paid (Cents) (FY19)Closing Price (18th March 2020)Current Dividend Yield (%)
OUE Commercial REIT3.31S$0.3210.34%
Frasers Commercial Trust9.60S$1.128.57%
Frasers Logistics and Industrial Trust7.00S$0.828.54%
SPH REIT5.60S$0.747.57%
ComfortDelgro9.79S$1.556.32%
CapitaMall Trust11.97S$1.836.54%
Mapletree Commercial Trust9.14S$1.775.16%
Parkway Life REIT13.19S$2.814.69%
ST Engineering15S$3.304.55%