Mapletree Logistics Trust (SGX: M44U) is a real estate investment trust (REIT) that owns 134 logistics properties around Asia and Australia. There are two things about income-seeking investors may want to know about the REIT right now: its latest financial results and valuation.
The table below shows the key financial figures from Mapletree Logistics Trust’s earnings report for the first quarter of the financial year ending March 2019 (FY18/19).
Source: Mapletree Logistics Trust’s Earnings Update
Overall, we see that there was growth across the board compared to a year ago.
The REIT’s performance was driven by growth from its existing portfolio along with contributions from its two new acquisitions in Hong Kong. As of 30 June 2018, the REIT’s gearing stood at 36.4% while its committed occupancy rate was 97.1%.
Ms Ng Kiat, CEO of the REIT manager, commented:
“This has been an exciting period of growth for MLT as we forged ahead with our expansion plans. In China, we strengthened MLT’s presence with the acquisition of a 50% interest in 11 new Grade-A logistics properties. In Singapore, we divested a warehouse with older specifications and recently announced the proposed acquisition of five modern ramp-up warehouses. These initiatives are in line with our strategy to build a high quality and resilient portfolio to deliver sustainable returns for our Unitholders.”
The REIT’s valuation
There are two useful valuation metrics when it comes to assessing REITs: its price-to-book (PB) ratio and its distribution yield.
The table below shows a summary of Mapletree Logistics Trust’s PB ratio and distribution yield and the respective averages for the two valuation metrics for the 41 REITs that are in Singapore’s stock market.
Source: SGX Stock Facts; data as of 4 October 2018
From this view, we can see that Mapletree Logistics Trust is trading at a premium compared to its peers, sporting a slightly lower distribution yield and a higher PB value.
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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.