The Motley Fool

2 Reasons Why Investors Might Like Frasers Centrepoint Trust Now

Frasers Centrepoint Trust (SGX: J69U) is a REIT with property portfolio comprising of the suburban retail properties in Singapore such as Causeway Point, Northpoint City North Wing (including Yishun 10 Retail Podium), Anchorpoint and others. The REIT also holds a 31.15% stake in Hektar Real Estate Investment Trust, a retail-focused REIT in Malaysia.

In general, REITs aer a popular investment vehicle among Singaporeans due to its favourable tax treatment, stable earnings power and more. Here, I will like to point out two good reasons to like Frasers Centrepoint Trust now.

Strong financial performance

Here is a table with the key figures from Frasers Centrepoint Trust’s earnings release for the second quarter of financial year ending 30 September 2018 (FY18).

Source: Frasers Centrepoint Trust Result Presentation

Overall, we can see that revenue, net property income and distribution per unit (DPU) came in ahead compared to the previous year.

Gross revenue for the quarter was up 6.3% year-on-year to $48.6 million. Meanwhile, net property income was up 6.9% to $34.8 million mainly due to a 31.7% year-on-year revenue increase from Northpoint City North Wing (including contribution from Yishun 10 retail podium), benefitting from improved occupancy after the completion of its asset enhancement initiative (AEI) works.

Positive outlook

From the previous table, we have learnt that Frasers Centrepoint had a good quarter. What’s more, investors could expect the good news to continue for the rest of the year.

Here’s what the CEO, Dr Chew Tuan Chiong commented (emphasis is mine):

“We are pleased that FCT has delivered another good set of results for 2Q18 with the DPU of 3.1 cents setting a new-high for a quarter. Northpoint City North Wing has delivered strong growth in 2Q18 with occupancy rising to 94%. This momentum will continue to underpin FCT’s earnings growth for FY2018. We remain focused on improving FCT’s performance and to deliver steady returns for our stakeholders.”


In all, Frasers Centrepoint Trust had delivered good result in its latest quarter, and is expected to continue to do so for the rest of the year.

We believe we’ve identified a dividend dynamo whose financials are strong enough to qualify its dividend as “safe” – and have profiled this stock in a research report that’s now available to download completely free of charge. Simply click here to claim your copy today!

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. Motley Fool has a recommendation for Frasers Centrepoint Trust.