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CapitaLand Mall Trust Posts Higher Distribution Per Unit For The 2018 First-Quarter

CapitaLand Mall Trust (SGX: C38U) is Singapore’s first and largest retail real estate investment trust (REIT). Some of the malls in its portfolio include Clarke Quay, Junction 8, and Plaza Singapura.

On Friday, the REIT announced its financial results for the first quarter ended 31 March 2018. Here are 10 things investors should know from the earnings announcement:

1. Gross revenue for the first quarter improved 1.8% to S$175.2 million. The higher gross revenue was largely due to better occupancy at IMM Building, Clarke Quay, The Atrium@Orchard and Plaza Singapura. Higher car park income contributed to the increase in gross revenue as well.

2. Net property income grew 4.7% to S$125.7 million due to the same reasons mentioned above.

3. Distributable income to unitholders went up 2.1% to S$99.0 million. Distribution per unit (DPU) grew from 2.73 Singapore cents last year to 2.78 Singapore cents in the latest quarter, an increase of 1.8% year-on-year.

4. The REIT ended the reporting quarter with a net asset value (NAV) per unit of S$1.96, a slight increase from end of last year’s NAV per unit of S$1.95.

5. As at 31 March 2018, the REIT’s aggregate leverage was 33.5%, an improvement from the figure of 34.2% seen as at 31 December 2017.

6. Shopper traffic at the REIT’s malls declined 2.1% year-on-year while tenants’ sales fell 0.2% during the same timeframe. (Note: Since Funan was closed in July last year for redevelopment, it has been removed from the comparisons.)

7. Portfolio rental reversion for the quarter improved by 0.8%. Tenant retention rate for the period was 82.9%.

8. As a percentage of gross rental income, 20.2% of the total is due for renewal for the rest of 2018. The bulk of the renewals, at 38.1%, are due at IMM Building. For context, the mall saw a rental reversion of 1.3% for the 2018 first-quarter.

9. Portfolio occupancy, as at 31 March 2018, was 98.9%. This is a decline from the end of 2017’s figure of 99.2%.

10. CapitaLand Mall Trust gave some updates on its portfolio:

a) It said that, during the quarter, Raffles City Singapore completed refurbishment works for the interior of its mall, including the lift lobbies.

b) Tampines Mall will be undergoing asset enhancement works amounting to S$8.2 million to create a new food and beverage duplex, enhance the mall’s façade, and refresh the external walkway. The works at the mall are slated to finish by the fourth quarter of 2018.

c) Last week, the REIT announced the divestment of Sembawang Shopping Centre to a joint venture between Lian Beng Group Ltd (SGX: L03) and Apricot Capital Pte Ltd for S$248 million. The divestment is expected to bring in net proceeds of about S$245.6 million once the transaction is finalised by June this year.

On Friday, the REIT closed at S$2.10, giving a price-to-book ratio of 1.07 and a trailing distribution yield of 5.3%.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended units of CapitaLand Mall Trust. Motley Fool Singapore contributor Sudhan P owns units in CapitaLand Mall Trust.