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A Look at Ascendas Hospitality Trust’s Latest Quarter

Ascendas hospitality trust Ascendas Hospitality Trust (SGX: Q1P) released its second quarter ended 30 September 2013 (2Q 2014) and the gross revenue was at S$53.1 million. This was an increase of 39.4% as compared to the previous year. The net property income rose 68.7% to S$21.3 million year-on-year. The increase was mainly because of the new contributions from Ibis Beijing Sanyuan and Park Hotel Clarke Quay, which were bought by the trust in December 2012 and June 2013, respectively.

The income available for distribution and distribution per unit (DPU) increased 67.3% and 11.9% to S$14.6 million and 1.41 Singapore cents, respectively.

The trust went public in July 2012, therefore, the results for 2Q 2013 only includes 65 days of income contribution, while results for 2Q 2014 includes 92 days of income contribution. Furthermore, the income from Park Hotel Clarke Quay and Ibis Beijing Sanyuan was included in 2Q 2014’s results as well.

As of 30th September 2013, the gearing ratio of the trust stood at 35.8%. Comparatively, other hospitality trusts listed in Singapore Exchange, like CDL Hospitality (SGX: J85) and OUE Hospitality Trust (SGX: SK7), have a gearing ratio of 28.1% and 33.2% respectively. As seen from the figures, it can be seen that Ascendas Hospitality Trust is more highly leveraged than the other two trusts.

The weighted average debt to maturity of the debt was at 2.2 years. The effective borrowing rate was at 2.9% and the net asset value was at S$0.76.

Chief Executive Officer of the Managers of Ascendas Hospitality Trust, Mr Tan Juay Hiang, said, “The acquisition of Park Hotel Clarke Quay has improved the risk profile of our portfolio, stabilised the earnings and reduced our foreign exchange exposure. We are also pleased that Park Hotel Clarke Quay has recently won ‘Singapore’s Leading City Hotel’ award at the 20th Annual World travel Awards. Following the completion of refurbishment, we have seen an increase in revenue per available room (“RevPAR”) for the Australia hotels. We will continue to work closely with the hotel managers to enhance the performance of our assets.”

The trust last traded at S$0.765. The price-to-book ratio is slightly above 1 and the distribution yield is around 7%.

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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.