Frasers Hospitality Trust sees 4.8% drop in Q4 DPS to 1.2154 cents

SINGAPORE - Frasers Hospitality Trust (FHT) clocked a fourth fiscal quarter distribution per stapled security (DPS) of 1.2154 Singapore cents, down 4.8 per cent from the 1.2763 cents for the same period last year.

For the period under review, its net property income (NPI) also took a hit, falling 6.7 per cent to $29.4 million, on the back of a 6.9 per cent drop in gross revenue to $38.7 million.

Income available for distribution declined 3.4 per cent to $23 million for Q4.

FHT, which owns properties across Asia, Australia and Europe, said the declines were due to overall weaker portfolio performance, except for the Singapore and Germany portfolios.

The softer performance of its Australia portfolio was attributed to the more competitive trading environment in Sydney, FHT said. Its Novotel Sydney Darling Square property was a bright spot, which continued to perform better year on year with the return of its full room inventory compared to last year when there was renovation.

In its Asia properties, the Westin Kuala Lumpur turned in significantly lower room and F&B (food and beverage) revenue for Q4 as corporate demand remained weak, while ANA Crowne Plaza Kobe's revenue was dented following the closure of its banquet space to replace partition walls. The hotel also saw cancellations due to recent typhoons.

For the 2018 financial year, FHT recorded an overall 5.6 per cent fall in DPS to 4.7613 Singapore cents. NPI was lower by 2.6 per cent to $117 million, in line with a 1.8 per cent lower gross revenue at $155.9 million.

Chief executive officer of FHT's manager Eu Chin Fen said that fiscal 2018 had been "a challenging year" for FHT.

Despite headwinds, the trust turned in a "reasonable set of results on the back of better performance reported by our properties in Melbourne, Singapore and Dresden," Ms Eu said.

"In addition, our Japan property reported steady performance despite the impact from the recent typhoons. Going forward, we will proactively pursue opportunities to optimise our portfolio and strengthen the competitive positioning ofour properties to create value for our stapled securityholders," Ms Eu added.

As at Sept 30, 2018, FHT's investment portfolio was independently valued at $2.4 billion, down from $2.44 billion a year ago. FHT attributed the 1.6 per cent decline mainly to the weakening of most foreign currencies against the Singapore dollar, except for the Japanese yen and Malaysian ringgit. In local currency terms, the valuations of its Australia, UK, Japan and Germany portfolios were higher year on year.

FHT's counter added 0.71 per cent to close at 70.5 cents on Thursday.