Mapletree Commercial Trust’s Latest Earnings: A Bump in Distributions for the Quarter

Mapletree Commercial Trust (SGX: N2IU) is a Singapore-focused real estate investment trust (REIT) that owns five office and retail assets in total. Its portfolio consists of VivoCity, Mapletree Business City I (MBC I), PSA Building, Mapletree Anson and Bank of America Merrill Lynch HarbourFront.

Yesterday, the REIT announced its financial results for the third quarter ended 31 December 2017. Here’s a quick rundown on the financial figures from the earnings release:

1. Quarterly gross revenue grew 0.8% year-on-year to S$109.7 million.

2. Net property income (NPI) rose 1.9% to S$86.0 million.

3. Income available for distribution went up 1.3% to S$66.5 million.

4. The reporting quarter’s distribution per unit (DPU) was 2.30 Singapore cents, up 0.9% as compared to last year’s DPU of 2.28 cents.

5. The net asset value per unit was S$1.37, as at 31 December 2017, a slight dip from the value of S$1.38 seen at end-March 2017.

Gross revenue and NPI increased for the quarter due to higher contributions from VivoCity and MBC I.

For the nine months to 31 December 2017, gross revenue went north by 20.1% to S$324.6 million while NPI surged 21.8% to S$254.6 million. During the same period, even though VivoCity’s shopper traffic fell 1.2% year-on-year to 41.4 million, tenant sales rose 1.2% to S$726.7 million.

The committed occupancy of the overall portfolio came in at 98.7%, with the actual occupancy at 94.6%. The weighted average lease expiry by gross rental revenue stood at 2.7 years.

Tenant retention rate by net lettable area was 80.5% while the rental reversion was up 1.2%, which includes a replacement tenant for pre-terminated lease.

As at 31 December 2017, the trust had a gearing ratio of 36.3%, an improvement from the figure of 37% seen a year ago. The weighted average all-in cost of debt was 2.73% per annum.

There is no refinancing due for the rest of the financial year. In the other years, the debt maturity profile is well-distributed with less than 20% of borrowings due for refinancing in any financial year.

The asset enhancement initiative (AEI) at VivoCity is progressing well and is on track to be completed in phases by the third quarter of the upcoming financial year. The AEI will see a new public library being added on Level 3 and the extension of Basement 1.

Mapletree Commercial Trust’s units closed at S$1.66 yesterday. This translates to a price-to-book ratio of 1.2 and a trailing distribution 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. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.