SINGAPORE – CapitaLand China Trust (CLCT) on Friday posted a 24.4 per cent year-on-year drop in distribution per unit (DPU) to 3.4 cents for its second half ended Dec 31, 2022, from 4.5 cents a year ago.
The lower DPU came despite the real estate investment trust (Reit) releasing $3.6 million from the amount available for distribution to unit holders previously retained in the first half of 2022.
Distributable income fell 20.3 per cent year on year to $56.9 million from $71.4 million, impacted by lower retail performance, higher interest expenses and the absence of one-off proceeds, said the Reit’s manager.
The decline in second-half performance can also be attributed to higher rental relief provided for tenants whose operations were affected by long periods of Covid-19 lockdowns during the year, particularly in the second half, the manager noted.
The manager’s chief executive, Mr Tan Tze Wooi, expects the Reit’s retail portfolio to shift to a positive trajectory in 2023 following China’s easing of Covid-19 restrictions.
CLCT’s portfolio is “well-placed to capitalise on growth opportunities across multiple sectors”, said Mr Soh Kim Soon, chairman of the Reit manager.
Gross revenue was down 8.6 per cent to $183.9 million for the half-year period, from $201.1 million a year ago, mainly due to a decline from the retail portfolio as most of the Reit’s China malls were mandated to close for various days in the second half of 2022.
Net property income (NPI) fell 11.8 per cent year on year to $114.7 million for the half-year, from $130.1 million.
The latest set of second-half results brought CLCT’s financial year 2022 DPU to 7.5 cents, down 14 per cent from 8.73 cents in financial year 2021, as the top-line increase was dragged by finance costs and taxes.
Gross revenue for the full year rose 1.4 per cent to $383.2 million from $378 million, as the provision for rental relief in the second half was more than offset by higher contributions from new acquisitions. The NPI for financial year 2022 increased 1.5 per cent to $254.2 million.
The business parks and logistics parks segments showed positive year-on-year performance for the year ended Dec 31, compared with financial year 2021.
In contrast, the retail malls segment saw a decline in gross revenue, falling by 6.5 per cent to $260.3 million in financial year 2022. The NPI for the segment also fell, dropping 8.7 per cent to $164.1 million.
CLCT’s retail assets, business parks and logistics parks registered positive rental reversions for financial year 2022 and achieved steady occupancy of 95.4 per cent, 91.4 per cent and 96.4 per cent respectively as at end-2022, with improved tenant quality.
Units of CLCT closed down two cents, or 1.6 per cent, at $1.25 on Friday. THE BUSINESS TIMES
