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What Investors Should Know About Mapletree Logistics Trust’s Latest Earnings and Valuation

Mapletree Logistics Trust (SGX: M44U) is a real estate investment trust that owns 124 logistics properties around Asia and Australia. 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 Mapletree Logistics Trust’s financial performance for the third quarter of its financial year ending 31 March 2018 (FY17/18). The reporting period was from 1 October 2017 to 31 December 2017.


Source: Mapletree Logistics Trust FY17/18 third quarter earnings press release

We can see that the REIT delivered decent year-on-year growth in the reporting quarter. Gross revenue was up by 2.8% while net property income climbed by 3.9%. These ultimately led to a 2.0% increase in the REIT’s available DPU (distribution per unit).

Mapletree Logistics Trust credited its growth to a stable performance from its existing properties as well as new contributions from accretive acquisitions. These positive factors were partially offset by the absence of contributions from three divestments and the redevelopment of one of two blocks in Ouluo Logistics Centre in China. The REIT ended the reporting quarter with a committed occupancy rate of 96.2%.

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 Mapletree Logistics 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 Logistics Trust is trading at a marginal discount to the market average given its slightly lower PB ratio and slightly higher 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.