Ascott Residence Trust almost doubles first-half DPS despite 11% revenue drop

Paloma West Midtown in Georgia, United States of America.
Paloma West Midtown in Georgia, United States of America.PHOTO: ASCOTT
Alpha Square Kita 15 is one of the three rental housing properties ART acquired in Sapporo, Japan.
Alpha Square Kita 15 is one of the three rental housing properties ART acquired in Sapporo, Japan.PHOTO: ASCOTT
Somerset Xu Hui in Shanghai.
Somerset Xu Hui in Shanghai.PHOTO: ASCOTT

SINGAPORE (THE BUSINESS TIMES) - CapitaLand subsidiary Ascott Residence Trust (ART) on Tuesday (July 27) reported a 95 per cent increase in its distribution per stapled security, at 2.05 cents - up from 1.05 cents for the year-ago period.

Its distributable income for the first half of the year also saw a 95.9 per cent jump to $63.8 million despite its reported revenue declining 11 per cent, according to its regulatory filing of its financial results.

The group also reported a first-half revenue per available unit of $60 per day, a decrease of 14 per cent as compared with the first half of last year.

This higher distributable income figure, according to the managers of the stapled hospitality group, includes a one-off partial distribution of a $20 million divestment gain; income from the termination of the sale of two Citadines assets ART holds in Xinghai Suzhou and Zhuankou Wuhan; as well as realised exchange gains from the divestment proceeds and repayment of foreign currency bank loans.

For the first half of the year, ART said it will be paying out 2.045 cents per stapled security on Aug 27.

The stapled group's revenue decline, the managers said, was attributed to a decrease in revenue of $13.1 million from the divestment of several properties. A further $14 million was recorded from its existing portfolio from the impact of the ongoing Covid-19 pandemic.

These losses were offset partially, however, by a $3.6 million contribution from the acquisition of Paloma West Midtown in February this year, three rental housing properties in Japan last month, and a full half-year contribution from Quest Macquarie Park Sydney, acquired in February last year.

ART also reported that its gross profit shrank by 7 per cent or $6.5 million for the half-year period compared with last year due to lower revenue, partly offset by lower operating costs. On a same-store basis, however, revenue decline was 7 per cent, and gross profit dropped by 1 per cent.

Its stapled securities closed up two cents, or 2 per cent, at $1.03 on Tuesday.