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SINGAPORE, Oct 28, 2015 - (ACN Newswire) - YTL Starhill Global REIT Management Limited, the manager of SGREIT, is pleased to announce the results for the three months ended 30 September 2015 (1Q FY15/16). Revenue for SGREIT group grew 16.8% over the previous corresponding period to S$56.8 million in 1Q FY15/16 and net property income ("NPI") for 1Q FY15/16 grew 10.2% over the previous corresponding period to S$43.6 million. The growth in revenue and NPI was mainly driven by the full-quarter contribution from the recently-acquired Myer Centre Adelaide and Singapore portfolio performance, partially offset by lower contributions from China and net foreign currency movements. Income to be distributed to Unitholders was S$28.6 million for 1Q FY15/16, 4.5% higher than that of S$27.3 million for the previous corresponding period of three months ended 30 September 2014.
Distribution Per Unit ("DPU") for the period from 1 July 2015 to 30 September 2015 was 1.31 cents, 3.1% higher compared to the 1.27 cents achieved for the previous corresponding period. On an annualised basis, the latest distribution represents a yield of 6.89%[1]. Unitholders can expect to receive their 1Q FY15/16 DPU on 27 November 2015. Book closure date is on 4 November 2015 at 5.00 pm.
Review of portfolio performance
SGREIT's Singapore portfolio, comprising interests in Wisma Atria and Ngee Ann City on Orchard Road, contributed 60.1% of total revenue, or S$34.1 million in 1Q FY15/16. NPI for 1Q FY15/16 increased by 3.6% y-o-y to S$26.9 million, led by positive rental reversions achieved in previous quarters, partially offset by higher operating expenses. Singapore retail portfolio recorded negative rental reversions of 7.3% for leases committed in 1Q FY15/16 to accommodate new retail concepts. The leases committed for the quarter accounted for less than 3% of Singapore retail portfolio's revenue excluding Toshin master lease at Ngee Ann City Retail. Wisma Atria Retail revenue increased 7.7% y-o-y and its NPI grew 5.6% over the previous corresponding period on the back of higher revenue. Tenant sales at Wisma Atria rose 1.1% y-o-y in 1Q FY15/16 mainly due to contributions from tenants which have recently started their operations at the mall. However, shopper traffic was down 9.7% y-o-y as the strata area owned by Isetan remained closed for its renovations.
Isetan's new tenant in the basement level, Mango, has since commenced operations in September 2015. Revenue from Ngee Ann City Retail gained 0.9% y-o-y while NPI increased 1.0% y-o-y. The Singapore office portfolio continued to benefit from healthy leasing demand amidst limited upcoming office supply space in Orchard Road as revenue and NPI increased 4.3% and 4.1% respectively in 1Q FY15/16 over the previous corresponding period, on the back of 3.5% positive rental reversions for leases committed in 1Q FY15/16. As at 30 September 2015, approximately one-third of the office leases due for expiry in FY15/16 by gross rent have been committed (renewed & new leases).
SGREIT's Australia portfolio, comprising Myer Centre Adelaide in Adelaide, South Australia, and the David Jones Building and adjoining Plaza Arcade in Perth, Western Australia, contributed 23.0% of total revenue, or S$13.1 million in 1Q FY15/16. NPI for 1Q FY15/16 was S$8.6 million, 113.2% higher than the previous corresponding period mainly due to the full-quarter contribution from the recentlyacquired Myer Centre Adelaide, partially offset by depreciation of the Australian dollar against the Singapore dollar and lower occupancies at David Jones Building. For the asset redevelopment plans at Plaza Arcade to accommodate anchor tenants and optimise upper-storey space, we are in negotiations with prospective anchor tenants.
SGREIT's Malaysia portfolio, comprising Starhill Gallery and interest in Lot 10 along Bukit Bintang in Kuala Lumpur, contributed 11.5% of total revenue, or S$6.5 million in 1Q FY15/16. NPI for 1Q FY15/16 was approximately S$6.3 million, 16.0% lower than the previous corresponding period, mainly due to depreciation of the Malaysian ringgit against the Singapore dollar and reversal of excess provision of property taxes in the previous corresponding period following the revision in property tax assessment. More than 70% of our net foreign income in Malaysian ringgit for 1Q FY15/16 was hedged via foreign exchange forward contracts.
Renhe Spring Zongbei in Chengdu, China, contributed 3.4% of total revenue, or S$1.9 million in 1Q FY15/16. NPI for 1Q FY15/16 was S$0.9 million, a decline of 27.5% from the previous corresponding period. The decline was largely attributed to lower revenue as the high-end luxury retail segment continues to be impacted by the austerity measures the central government has put in place, as well as increasing challenges and competition from new and upcoming malls in the city.
In 1Q FY15/16, SGREIT's Japan portfolio, which comprises five properties located in central Tokyo, contributed 2.0% of total revenue. NPI for 1Q FY15/16 was S$0.9 million, 11.5% higher than in the previous corresponding period, largely attributable to higher occupancies and lower operating expenses, partially offset by depreciation of the Japanese yen against the Singapore dollar. The overall committed portfolio occupancy improved to 98.1% as at 30 September 2015 with full occupancies maintained in four out of its five properties.
[1] Based on the closing price of S$0.755 as at 30 September 2015.
[2] Approximately S$1.5 million of income available for distribution for the quarter ended 30 September 2015 has been retained for working capital requirements (Quarter ended 30 September 2014: S$0.9 million).
[3] There is no CPU distribution for 1Q FY15/16, following the conversion of the remaining 20,334,750 CPU into 27,986,168 new ordinary units on 25 June 2015.
Contact:
Jonathan Kuah
YTL Starhill Global REIT Management Limited
Tel: +65 6835 8693; Mob: +65 9753 3930
Email: jonathan.kuah@ytlstarhill.com
Topic: Earnings
Source: Starhill Global REIT
Sectors: Daily Finance
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From the Asia Corporate News Network
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