Global Logistic Properties Q3 profit falls 36.2%

SINGAPORE - Mainboard-listed Global Logistic Properties (GLP) announced on Thursday (Feb 5) that profit for its third quarter of its 2015 financial year ended December 31, 2014, fell 36.2 per cent to US$112.4 million from US$176.2 million a year ago.

The logistics group saw its revenue edge up 0.7 per cent to US$179 million, on the inclusion of one month's revenue of its Brazil portfolio that was acquired in June 2014, and the completion of its development projects in China.

But this was offset by deferred rental revenue in Airport City Development, the sale of 11 properties in Japan to GLP J-Reit, and a weaker Japanese yen against the US dollar.

At the same time, the increase in leasable area and the attributable expenses of the group's propertes in China, coupled with the inclusion of the Brazil portfolio, led to a hike in its property-related expenses, causing them to rise 15.1 per cent to US$35.1 million.

Other expenses were also higher at US$41.7 million, up 20.4 per cent, on higher staff and business costs due to the expansion, the group said.

GLP CEO and co-founder Ming Z Mei said thw third quarter saw continued leasing and development momentum in China.

"This year, we brought several new investors into our China business, and these strategic partners are expected to strengthen GLP's land sourcing capabilities and generate new business opportunities."

"We are also pleased to further grow our best-in-class fund management platform with our announced entry into the US logistics market."

The group in December announced the acquisition of a US$8.1 billion logistics portfolio in the US with Singapore investment firm GIC. GLP said it will initially hold a 55 per cent stake in the acquired portfolio - GLP US Income Partners I - and intends to reduce its stake to 10 per cent.

Fund management revenue in the third quarter surged 92 per cent year-on-year to US$31 million. This comprised asset and property management fees of US$15 million and development fees of US$16 million.

"Looking forward, we will continue our three-pronged growth strategy of being the best operator, creating value through developments and expanding our fund management platform," said Mr Ming.