OUE Hospitality Trust's Q2 distributions beat forecast

Cutting property expenses helped OUE Hospitality Trust, which owns the Mandarin Gallery along Orchard Road,  post distributions that were higher than forecast for the second quarter of the year. -- ST FILE PHOTO
Cutting property expenses helped OUE Hospitality Trust, which owns the Mandarin Gallery along Orchard Road,  post distributions that were higher than forecast for the second quarter of the year. -- ST FILE PHOTO

SINGAPORE - Cutting property expenses helped OUE Hospitality Trust post distributions that were higher than forecast for the second quarter of the year.

The trust owns the Mandarin Gallery shopping mall and the Mandarin Orchard Singapore hotel in Orchard Road.

Distribution per stapled security was 1.64 cents for the three months to June 30, which was 2.5 per cent more than expected, the trust said in a Singapore Exchange filing on Thursday.

OUE Hospitality Trust comprises stapled securities from the OUE Hospitality Real Estate Investment Trust (Reit) and OUE Hospitality Business Trust.

Income available for distribution came in at $21.6 million for the quarter, which was 2.3 per cent above forecast.

This was on the back of a net property income of $25.2 million, which was 1.2 per cent higher than predicted. Its revenue for the period was the same as forecast, at $28.3 million.

OUE Hospitality Trust said that its property expenses for the second quarter were less than expected due to lower utility costs and reduced property tax for Mandarin Gallery.

Mr Chong Kee Hiong, chief executive of the trust manager, added in the statement that the ongoing renovation of 430 guest rooms in the Mandarin Orchard Singapore hotel was sped up in the second quarter so that the hotel could "optimise business in the second half of the year, which typically enjoys seasonally higher hospitality demand".

The renovation of 160 of those rooms has been completed.

The trust's stapled securities closed one cent higher at 90.5 cents on Thursday.

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