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2 Things That Investors Should Know About Frasers Logistics and Industrial Trust Now

Frasers Logistics and Industrial Trust (SGX: BUOU), or FLT, is the first Singapore-listed real estate investment trust (REIT) with an initial pure-play Australian industrial portfolio. FLT owns 61 Australian industrial real estate assets concentrated within major industrial markets in Australia, which includes Melbourne, Sydney and Brisbane.

There are two things about the REIT that investors may want to know about right now – its latest financial performance and valuation.

Financial performance

Here’s a table showing important items from FLT’s financial performance for the year ended 30 September 2017 (FY2017).

Source: FHT Fourth Quarter Result For FY2017

Overall, we see that all actual metrics were higher than forecast metrics, both quarterly and annually.

Robert Wallace, Chief Executive Officer of the REIT’s manager, made the following comments:

“We are pleased to report a strong finish to FLT’s first financial period close having surpassed the IPO forecast for the fifth consecutive quarter.

Our performance reflects the strength of FLT’s property portfolio, proactive asset management with 172,193 sq m of floor space leased and/or renewed since listing, representing 13.1% of FLT’s total gross lettable area as at 30 September 2017.

Our position as a leading industrial landlord in Australia was strengthened through the acquisition of 10 new properties since FLT’s listing, increasing its total portfolio value to A$1.91 billion as at 30 September 2017.”

In sum, it was a good quarter and a good year for the REIT with performance coming ahead of its forecast.

Valuation

There are two useful valuation metrics for assessing REITs. They are the price-to-book (PB) ratio, and the distribution yield.

The table below shows FLT’s PB ratio and distribution yield. It also shows the respective averages for the two valuation metrics for the 40 REITs that are in Singapore’s stock market.

Source: SGX Stock Facts and Google Finance; data as at 9 January 2018

We can see that FLT is trading at a premium to market average based on its PB value and slightly lower distribution yield.

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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 Lawrence Nga doesn’t own shares in any companies mentioned.