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2 Things That Investors Should Know About Cache Logistics Trust Now

Cache Logistics Trust (SGX: K2LU) is a REIT that focuses on logistics properties. It currently has 27 logistics warehouse properties in its portfolio, which are located in Singapore, Australia, and China. There are two things to know about the REIT right now: its latest financial performance and valuation.

Financial performance

Here is a table showing important items from Cache Logistic Trust’s financial performance for the third quarter of financial year ending 31 December 2018 (FY18).

Source: Cache Logistic Trust Result Presentation

The year-on-year improvement in gross revenue and net property income (NPI) were due higher contributions from the 9-property Australian portfolio acquired in February 2018, as well as higher revenue from 51 Alps Ave. On the other hand, the decline in distribution per unit (DPU) was due to lower income available for distribution and an increase in the number of units issued.

As at 30 September 2018, the logistics REIT clocked in a gearing ratio of 35.6% while its committed occupancy rate stood at 96.9%.

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 Cache Logistic 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 StockFacts

We can see that Cache Logistic Trust’s valuation is lower than the market average due to its high distribution yield and low PB ratio.

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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.