In late January, Viva Industrial Trust (SGX: T8B) released its fourth quarter earnings for 2017.
As a quick introduction, Viva Industrial Trust is a stapled trust that consists of a business trust and real estate investment trust. It invests in business parks and other industrial properties. Currently, Viva Industrial Trust’s portfolio comprises nine properties in Singapore.
Here are nine things investors should know about the trust’s latest results:
1. Gross revenue for the reporting quarter grew 10.8% to S$28.34 million while net property income increased by 14.3% to S$20.66 million.
2. Similarly, the trust’s distribution per stapled security (DPS) was up by 5.5% year-on-year to 1.857 cents.
3.Based on Viva Industrial Trust’s 2017 total DPS of 7.472 cents , and its closing unit price of S$0.91 as of 8 February 2018, the trust has a trailing distribution yield of 8.2%.
4. As of 31 December 2017, the Viva Industrial Trust’s gearing stood at 39.8%, which is below the regulatory ceiling of 45%.
5. The Trust’s portfolio had a committed occupancy rate of 90.6% at end-2017.
6. The weighted average lease expiry (by rental income) was at 2.6 years as of 31 December 2017.
7. Viva Industrial Trust has over 155 tenants as of 31 December 2017, of which the top 10 tenants accounted for 43% of its portfolio’s committed rental income.
8. VIT renewed 71% of leases due for renewal in FY 2017 with an overall rental reversion of 2.6%.
9. To close,Viva Industrial Trust provided the following outlook:
“Singapore’s GDP grew by 3.1% in 4Q2017 and 3.5% for FY2017 (based on advanced estimates) clocking the fastest full year pace of growth since 2014. Growth continues to be led by the manufacturing sector with a 6.2% y-o-y expansion for the quarter on the back of robust performance from the electronics and precision engineering clusters.
With the tailwinds behind the macro-economy gaining some momentum, the general industrial property market should begin to see some recovery in rents and occupancy over the course of this year.”
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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.