Mapletree Logistics Trust's Q4 DPU falls 2.7%

MLT has completed redevelopment works at Toh Guan Road East.
MLT has completed redevelopment works at Toh Guan Road East.PHOTO: MAPLETREE LOGISTICS TRUST MANAGEMENT

Drop due in part to higher fees, absence of distribution from divestment gain

Stronger results from overseas properties and contributions from recent acquisitions lifted fourth- quarter revenue and earnings at Mapletree Logistics Trust (MLT).

However, it posted a 2.7 per cent drop in distribution per unit (DPU) for the three months to March 31 at 1.8 cents, down from 1.85 cents for the same period a year ago, Mapletree Logistics Trust Management, the trust manager, said yesterday.

It attributed the lower DPU to higher borrowing costs, tax and management fees, the absence of distribution from divestment gain and the enlarged issued unit base due to the Reit's implementation of the distribution reinvestment plan.

Net property income in the fourth quarter climbed 3.3 per cent to $72.6 million as gross revenue jumped to $88.4 million, up 4.4 per cent from the previous year.

MLT's portfolio comprises 118 properties spanning eight markets, and they were valued at $5.1 billion as at March 31.

The trust manager said the higher turnover came on the back of contributions from three properties acquired in Australia, South Korea and Vietnam during the financial year. The stronger performance at its properties in Hong Kong and mainland China, as well as the foreign exchange effects from a stronger Japanese yen and Hong Kong dollar, also helped to boost revenue.

  • AT A GLANCE

  • GROSS REVENUE: $88.4 million (+4.4%)

    NET PROPERTY INCOME:

    $72.6 million (+3.3%)

    DISTRIBUTION PER UNIT:

    1.8 cents (-2.7%)

However, the revenue growth was partly offset by poorer performance from Singapore and the impact of a weaker Malaysian ringgit.

Ms Ng Kiat, chief executive of the trust manager, said: "We faced significant headwinds in Singapore due to the conversions of (single-user assets) to (multi-tenanted buildings) amidst rising supply of warehouse space."

Fourth-quarter property expenses rose 10.2 per cent to $15.8 million, mainly due to the completed acquisitions and higher costs related to the conversion of assets. Net asset value per unit was $1.02 as at March 31, down from $1.03 a year earlier.

In March, MLT completed redevelopment works at 5B Toh Guan Road East and renovations at the Moriya Centre in Japan.

MLT posted a 4.8 per cent increase for its full-year net property income to $290.9 million, while gross revenue rose 6 per cent to $349.9 million.

Even though it had been a challenging year, the trust manager said MLT has maintained a healthy portfolio occupancy rate of 96.2 per cent, down slightly from 96.7 per cent at the end of March 2015.

The trust manager said 91 per cent of the leases due to expire in the 2015-16 financial year were renewed or replaced, with a positive average rental reversion rate of about 4 per cent.

It expects the outlook to remain challenging but noted that "MLT's diversified portfolio, coupled with a well-staggered lease expiry profile, is expected to continue to provide resilience to the portfolio's income and cash flows".

The trust's units closed half a cent up at $1.08 yesterday, before its earnings were released.

A version of this article appeared in the print edition of The Straits Times on April 30, 2016, with the headline 'Mapletree Logistics Trust's Q4 DPU falls 2.7%'. Print Edition | Subscribe