CDL Hospitality's net property income rises

The acquisition of Japan Hotels in December has boosted second-quarter earnings at CDL Hospitality Trusts but the distribution to investors slipped.

Distribution per stapled security for the period ended June 30 fell 10 per cent to 2.25 cents, as the contribution from Japan Hotels will be available for distribution only from the fourth quarter. Net property income for the quarter rose 0.9 per cent to $31.62 million as gross revenue rose 3 per cent to $39 million.

The results were dragged down by headwinds in the Singapore hospitality market and lower rents in Australia and New Zealand, with the weakening of the Australian dollar and New Zealand dollar against the Singapore dollar.

Hotel room supply will grow by 4,405 rooms this year, and room rates are likely to stay competitive, he said. For the first 27 days of this month, revenue per available room (RevPar) for Singapore hotels fell 4.2 per cent year on year - an indication for the rest of the quarter.

Net property income from Australia fell 10.6 per cent to $3.57 million due to the weaker Australian dollar during the quarter, while that from New Zealand fell 6.3 per cent to $2.44 million mainly due to the weaker New Zealand dollar. Net property income from Maldives resorts was also down.

The bright spark in the portfolio was from Japan Hotels, with RevPar growth of 29.1 per cent in the second quarter, thanks to a surge in visitor arrivals.

A version of this article appeared in the print edition of The Straits Times on July 30, 2015, with the headline 'CDL Hospitality's net property income rises'. Print Edition | Subscribe