CapitaLand China Trust first-half DPU falls 19.5% on lower revenue

SINGAPORE - Real estate investment trust (Reit) CapitaLand China Trust (CLCT) posted on July 30 a 19.5 per cent drop in distribution per unit (DPU) to 3.01 cents for the first half ended June 30, from 3.74 cents in the corresponding year-ago period.

This was due to decreased gross revenue for the period, which came in at $173 million in Singapore dollar terms, down 6.3 per cent from $184.5 million year on year.

In yuan terms, gross revenue slid 2.3 per cent to 925.9 million yuan, from 947.8 million yuan. The decrease in Singapore dollars was higher due to the weaker yuan against the Singapore dollar.

The Reit manager said the decrease was due to lower revenue from the logistics parks portfolio, as it had lower occupancy and rental rates. The logistics park portfolio had a revenue of $4.4 million in the first half of the 2024 financial year, declining 47.5 per cent from $8.4 million in the first half of FY2023.

There was also a reduced contribution from CapitaMall Shuangjing, which was divested in January 2024.

This fall was partially mitigated by higher revenue growth from the retail portfolio, primarily driven by the completion of asset enhancement initiatives (AEI) in CapitaMall Grand Canyon, Rock Square and CapitaMall Yuhuating, as well as proactive lease management in CapitaMall Xizhimen and CapitaMall Xuefu

Net property income fell 8.7 per cent to $117.9 million, from $129.2 million. This was due to higher property operating expenses in yuan terms, as there was a reduction in property tax incentives received by business parks in H1 2024.

Distributable income available to unitholders likewise decreased, falling 18.7 per cent to $51.3 million, compared to $63.1 million year on year.

The record date for the first-half DPU is Aug 7, while the payment date is Sept 25, said the manager.

On a half-on-half basis, the DPU for first-half FY2024 increased marginally by 0.3 per cent compared to the second half of FY2023 DPU of three cents. This was due to higher income contribution from the retail portfolio and lower net financing cost.

Commenting on the results, Mr Tan Tze Wooi, chief executive of CLCT’s manager, said: “By integrating new offerings and immersive customer experiences, CLCT achieved high retail occupancy of 97.8 per cent driven by strong year-on-year growth in shopper traffic and tenant sales at malls that recently completed AEI (asset enhancement initiatives).”

He added that China’s government is likely to focus on stimulating domestic demand and promoting technological advancements among a series of reforms, and the Reit is positioned to capitalise on the growth opportunities from these policy directions.

Units of CLCT were trading unchanged at 68 cents as at 9.27am on July 30.

THE BUSINESS TIMES