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.
There are two things about the REIT that investors may want to know about right now: Its latest financial performance and valuation.
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The table below shows important items from Mapletree Commercial Trust’s income statement for the third quarter of its financial year ending 31 March 2018 (FY17/18). The reporting period is from 1 October 2017 to 31 December 2017.
Source: Mapletree Commercial Trust FY17/18 third quarter earnings press release
We can see that the REIT had a decent quarter, with slight growth in gross revenue, net property income, income available for distribution, and distribution per unit (DPU).
Sharon Lim, the chief executive officer of Mapletree Commercial Trust’s manager, gave a summary of the REIT’s latest quarterly results in the earnings update:
“MCT has continued to deliver steady performance for 3Q FY17/18 amid headwinds in the operating environment. Underscoring our effort on active asset management, contribution from VivoCity and MBC I were higher and we achieved sustained savings in operating expenses. As a result, MCT recorded resilient growth in NPI and DPU was up 0.9% year-on-year.”
Mapletree Commercial Trust ended the reporting quarter with a committed occupancy rate of 98.7% for its portfolio. It was, in all, a steady performance from the REIT.
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 Mapletree Commercial Trust’s PB ratio and distribution yield. It also shows the respective averages for the two valuation metrics for the 41 REITs that are in Singapore’s stock market.
Source: SGX Stock Facts
We can see that Mapletree Commercial Trust is trading at a premium to the market, based on its higher PB ratio and 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.