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Earnings Brief: Frasers Logistics and Industrial Trust, Parkway Life REIT and CDL Hospitality Trusts

Yesterday, Frasers Logistics and Industrial Trust (SGX: BUOU) made public its first-quarter earnings while Parkway Life REIT (SGX: C2PU) and CDL Hospitality Trusts (SGX: J85) released their full-year earnings this morning.

Here are some quick highlights from the earnings announcements:

Frasers Logistics and Industrial Trust (FLT)

1) Revenue for the first quarter ended 31 December 2017 grew 6.9% year-on-year to A$42.4 million.

2) Adjusted net property income (NPI) went up 8.9% to A$33.4 million. This version of NPI is the “actual net property income excluding straight lining adjustments for rental income and after adding back straight lining adjustments for ground leases”.

3) The growth in adjusted NPI was mainly due to the acquisitions of four completed properties, and the practical completions of Beaulieu and Stanley Black & Decker facilities.

4) Distributable income rose 3.9% to A$25.9 million while distribution per unit (DPU) climbed up 3.4%, from 1.74 Singapore cents to 1.80 Singapore cents.

5) As at 31 December 2017, the net asset value per unit was S$0.91, the aggregate leverage stood at 30.9%, and the portfolio occupancy was 99.4%.

6) The REIT’s manager had this to say about the REIT’s latest performance and its growth prospects:

“FLT started the year on a strong footing, delivering year-on-year DPU growth to our unitholders. In line with the REIT Manager’s focus on active portfolio management, we executed three forward lease extensions in 1QFY18, further extending FLT’s lease expiry profile. The continued strength of our property portfolio, together with the pipeline of potential Australian and European industrial and logistics properties from our Sponsor, Frasers Centrepoint Limited, positions FLT for both organic and inorganic growth opportunities.”

Parkway Life REIT

1) Gross revenue for the year ended 31 December 2017 slipped 0.2% to S$109.9 million. The fall was due to the depreciation of the Japanese Yen, which offset the increase in gross revenue from the new acquisitions in the first quarter of 2017 and the rent increase from the hospitals in Singapore.

2) NPI inched up 0.2% to S$102.6 million though. The increase was on the back of lower property expenses due to the absence of one-off marketing commission paid to the REIT’s manager.

3) Distributable income surged 10.2% from S$73.3 million last year to S$80.8 million in the latest period, which included S$5.4 million in divestment gains.

4) As a result, DPU increased by the same percentage to 13.35 Singapore cents.

5) As at 31 December 207, the net asset value per unit came in at S$1.76, the gearing stood at 36.4% while the overall portfolio occupancy was 99.97%.

6) The healthcare REIT’s manager commented the following on the latest performance, with a focus on the assets in Japan:

“Building on our strategies and network developed in the last 10 years, we are pleased to deliver another sound set of results for Unitholders in 2017. In 1Q 2017, we completed our 2nd Strategic Japan Asset Recycling Exercise and successfully rebalanced our Japan portfolio with the acquisition of five better quality Japan properties. Maintaining a strong focus in cultivating good Landlord-Lessee relationships, three more asset enhancement initiatives were rolled out for our Japan portfolio in 2017, bringing the total to twelve to-date.”

CDL Hospitality Trusts

1) For the financial year ended 31 December 2017, gross revenue increased 13% year-on-year to S$204.3 million. The improvement was largely on the back of contributions from new acquisitions of The Lowry Hotel in Manchester, United Kingdom and Pullman Hotel Munich in Germany, and robust performance from Grand Millennium Auckland in New Zealand. The retail mall adjoining Singapore’s Orchard Hotel, Claymore Connect, also posted higher contribution.

2) NPI came in at S$151.8 million for the year, which was a growth of 10.3% as compared to the same period in 2016.

3) Total distribution to stapled security holders, after retention for working capital, for the year increased 11.3% to S$110.3 million.

4) Due to an enlarged stapled security base from a rights issue in August 2017, distribution per stapled security was 9.22 cents for 2017, a drop compared to 9.63 cents to a year ago.

5) As at 31 December 2017, the net asset value per stapled security was S$1.53, and the gearing stood at 32.6%. The trust said that the gearing would be “further lowered from the use of proceeds from the divestment of Mercure Brisbane and Ibis Brisbane”.

6) The average occupancy rate at the Singapore hotels for the year was at 86.7%, up from 85.4% a year back. Revenue per available room, a performance metric used in the hospitality sector, fell 0.6% year-on-year to S$159.

7) Vincent Yeo, the chief executive of CDL Hospitality Trusts’ managers, gave a summary of the year and his thoughts on the two divestments:

“We have had a very eventful 2017 where we have successfully grown our portfolio and penetrated key new markets. Our new acquisitions will help to diversify our geographic exposure and support our income growth. It is pleasing to see that our core market, Singapore, is showing stability amidst new supply in 2017. We look forward to capitalising on a stronger event calendar in Singapore for 2018.

In disposing of our two Brisbane hotels, Mercure Brisbane and Ibis Brisbane, in January 2018, for an attractive exit yield and premium over the original purchase price, we have furthered our asset management strategy of unlocking the value of our assets.”

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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.