10 Things to Know About CapitaLand Mall Trust’s Latest Earnings

CapitaLand Mall Trust (SGX: C38U), or CMT, is Singapore’s largest retail real estate investment trust (REIT) by market capitalisation. Some of the malls in its portfolio include IMM Building, Junction 8, and Plaza Singapura. CMT also owns a stake in CapitaLand Retail China Trust (SGX: AU8U), the first China shopping mall REIT to be listed here.

On Friday, the retail REIT announced its financial results for the third quarter ended 30 September 2017 (3Q2017). The reporting period was from 1 July 2017 to 30 September 2017.

Here are 10 things investors should know from the earnings announcement:

1. Gross revenue for the third quarter slipped 0.2% to S$169.4 million. The lower gross revenue was largely due to lower rental at Bedok Mall, Plaza Singapura and Junction 8.

2. Net property income, however, rose 1.6% to S$121.4 million due to a 4.2% fall in property operating expenses. Property operating expenses declined mainly due to lower property tax and utilities

3. Distributable income to unitholders increased 0.3% to S$98.7 million.

4. Distribution per unit was flat for 3Q2017, coming in at 2.78 Singapore cents.

5. The REIT ended the reporting quarter with an adjusted net asset value per unit of S$1.92.

6. For the first nine months of 2017, shopper traffic at the REIT’s malls rose 0.2% year-on-year while tenants’ sales remained flat during the same timeframe. (Note: Funan, which was closed in July last year for redevelopment, has been removed from the comparisons.)

7. Portfolio rental reversion for the first nine months of 2017 was at a negative 1.7%.

8. Portfolio occupancy, as at 30 September 2017, was at 99%, a high not seen since 31 December 2011.

9. As of 30 September 2017, the REIT’s average cost of debt was 2%, and aggregate leverage was 34.7%.

10. During the quarter, CapitaLand Mall Trust announced the divestment of the serviced residence component of Funan at an agreed land value of S$90.5 million. The divestment will help to lower the REIT’s development risks and funding requirements, as well as improve the return on investment for Funan’s redevelopment.

CapitaLand Mall Trust’s units are going at S$2.06 now. The price translates to a price-to-book ratio of 1.07 and a trailing yield of 5.4%.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice.The Motley Fool Singapore has recommended units of CapitaLand Mall Trust. Motley Fool Singapore contributor Sudhan P owns units of CapitaLand Mall Trust.