Distributable Income Rises at CapitaCommercial Trust

Capitacommercial logoCapitaCommercial Trust (SGX: C61U), or CCT, saw its gross revenue dip 0.6% to S$95m in the third quarter.

Net property income slipped 3.5% to S$73m, while distributable income rose 1.6% to S$59m. Unit holders will receive an estimated 2.04 Singapore cents in distribution, which is unchanged from last year.

Gross revenue fell because of “lower income contribution from Capital Tower due to its lower occupancy, and for the cessation of yield protection income for One George Street from 10 July 2013”.

However, this was compensated by “higher revenue from Six Battery Road and Raffles City Singapore.”

Lower revenue and higher operating expenses resulted in the 3.5% drop in net property income. The 1.6% increase in distributable income was due to “lower interest expenses in 3Q 2013 and distribution of tax-exempt 1H 2013 distributable income received from Quill Capita Trust.”

CCT’s portfolio occupancy rate stood at 97.6%. The gearing ratio was 29.5%, with the average cost of debt at 2.7%. The net asset value is $1.66.

Chief Executive Officer, Lynette Leong, said: “We are encouraged by the increase in leasing activities at CCT’s properties. CCT has signed new leases and renewals of approximately 347,000 square feet for 3Q 2013, of which 42.0 per cent are new leases.

She added: “Given the uptick in office market rents as affirmed by market statistics, CCT should further benefit from positive rent reversions for 13 per cent of office leases based on portfolio gross rental income that are due for rent review and renewal in 2014.”

The shares cost $1.44. This translates to a price-to-book ratio of 0.87. The distribution yield is 5.6%.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.  Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.