Frasers Hospitality Trust sees 7.8% fall in quarterly DPS

A weaker performance across parts of its portfolio dented the numbers at Frasers Hospitality Trust (FHT) in the second quarter.

It posted a 7.8 per cent dip in distribution per stapled security to 1.1126 cents, compared with the same period last year.

FHT is a stapled group comprising Frasers Hospitality Real Estate Investment Trust and Frasers Hospitality Business Trust.

Net property income fell 4 per cent to $27.8 million, on the back of a 3.1 per cent slide in gross revenue to $37.5 million.

The Australian portfolio turned in a weaker performance in the three months to March 31, due to the more competitive trading environment in Sydney and Novotel Sydney Darling Square's renovation, which was completed at the end of January.

Softer corporate demand contributed to softer performance of the trust's British and Malaysian portfolios, while adverse weather did not help leisure demand in Britain either, said FHT yesterday.

Income available for distribution fell 6.5 per cent to $20.9 million as a result of lower net property income and higher finance costs arising from the refinancing of term loans with longer tenure bonds.

  • AT A GLANCE

  • GROSS REVENUE: $37.5 million (-3.1%)

    NET PROPERTY INCOME: $27.8 million (-4%)

    DISTRIBUTION PER SECURITY: 1.1126 cents (-7.8%)

"This quarter, our Sydney properties face a more competitive landscape, due to softer corporate demand. Post-renovation, Novotel Sydney Darling Square is expected to ramp up its performance in the next few months," said Ms Eu Chin Fen, chief executive of FHT's managers.

"With our debt headroom and the strength of our balance sheet, we will continue to actively pursue acquisition opportunities," she added.

The trust has set the books closure date for May 7 with the distribution payment for June 29.

FHT stapled securities closed down half a cent to 74.5 cents yesterday.

A version of this article appeared in the print edition of The Straits Times on April 27, 2018, with the headline 'Frasers Hospitality Trust sees 7.8% fall in quarterly DPS'. Print Edition | Subscribe