Month: October 2010
CRCT – DBSV
Portfolio remixing in progress
• DPU of 2.08 Scts in line with estimates
• Portfolio performance stable; AEI in Saihan yielding results
• Maintain HOLD given limited upside to raised TP of S$1.30; CRCT offers a total return of 12%.
DPU of 2.08 Scts in line. Topline and net property income were flattish at S$29.8m (-0.2% yoy, +0.7%qoq) and S$19.0m (+4.3%yoy, -3.8%qoq) respectively, due to a stronger S$:RMB exchange rate. Distributable income came in 3.2% higher, translating to a DPU of 2.08Scts.
Portfolio performance remains stable, enhancement works (“AEI”) in Saihan yielding positive results. In RMB terms, the portfolio delivered a topline growth of 4.5% yoy to RMB 147.2m. The improvement was portfolio wide with average occupancy levels inching up to 97.3% (against 95.0% a year ago), backed by stronger tenant sales growth of 24.9% yoy and 10.1% qoq. A major contributor came from Xizhimen Mall (recorded new contribution from Beijing Hualian Supermarket in Basement 1) and Wangjing Mall, which enjoyed higher rental revenues and occupancy rates. Sequentially, topline remained stable but we note that Saihan, Xinwu Mall – smaller malls in the portfolio have shown a sustained improvement in operational performance. Qibao Mall, however, reported lower revenues as it is undergoing asset enhancement and tenant remixing program. Looking ahead, we expect single digit uplift in topline as the manager continues to fine-tune the tenant profiles in order to attain the optimal portfolio mix and offering to consumers.
Renewed S$200m of short term loans. Renewed loans willextend debt expiry profile to 2.37 years from 1.01 years currently. Interest cover remains high at 6.2x.
Maintain Hold, TP raised to S$1.30. We maintain our HOLD call, given limited upside to our raised TP of S$1.30 after rolling valuation forward to FY11. CRCT offers forward yields of 6.7-6.9%.
CIT – BT
CIT Q3 distributable income dips 3.6%
CAMBRIDGE Industrial Trust (CIT) yesterday reported steady financial results for its third quarter.
Distributable income was down 3.6 per cent from a year earlier to $10.81 million. Distribution per unit was 1.187 cents.
The dip in distributable income was accompanied by a 2.6 per cent decline in gross revenue to $18.21 million, mainly due to lower rental income resulting from the sale of some properties and strata units between October last year and Sept 30, 2010.
Occupancy rate remains high at 99.97 per cent, ‘higher than the national average of 92.3 per cent’, CIT said.
The book value of its investment properties was $838.5 million at Sept 30, down from $874.2 million at Dec 31, 2009.
During Q3, CIT acquired two industrial properties. On Sept 16, it conducted a private placement exercise that raised $40 million, $24.7 million of which was used to partly fund the acquisition of the two properties for a total $37.7 million.
CEO of CIT Chris Calvert said that the ‘strong interest from institutional and certain private investors in the recent private placement demonstrates the attractiveness of CIT as a Reit investment’.
Further boosting its financial flexibility, CIT has secured a new three-year acquisition term loan and revolving credit facility totalling $70 million.
The company also moved to strengthen its balance sheet during Q3. It has reportedly reduced its gearing ratio to 39 per cent from 42 per cent, after repaying part of a $32 million term loan. It has earmarked an additional $35 million from divestments to a loan repayment on Nov 17 that will further bring its gearing to 36.8 per cent.
Following the September private placement, CIT unitholders had an advance distribution of 0.68 of a cent per unit. They will receive the balance of 0.507-cent per unit on Nov 30.
The CIT counter closed a cent higher at 56.5 cents yesterday.
CRCT – BT
Strong Sing$ eats into CRCT’s Q3 earnings
Income available for distribution for the period up 3.2% at $13m
CAPITARETAIL China Trust (CRCT) posted improved third-quarter earnings yesterday, although the strengthening Singapore dollar took some shine off its results.
CRCT’s eight malls in China brought in a gross revenue of 147.2 million yuan (S$29.8 million) for the quarter ended Sept 30 – up 4.5 per cent from a year ago as some malls collected more rent. Net property income rose 9.1 per cent to 94.2 million yuan.
Converted to Singapore dollars, however, gross revenue slipped 0.2 per cent from last year to $29.8 million, while net property income increased by a smaller 4.3 per cent to $19 million.
‘The lower growth in Singapore dollar terms was due to the stronger Singapore dollar against yuan between Q3 2009 and Q3 2010,’ CRCT said.
Income available for distribution for Q3 rose 3.2 per cent year on year to $13 million. This sent distribution per unit (DPU) up 3 per cent to 2.08 cents.
The annualised DPU works out to 8.25 cents. Based on CRCT’s closing unit price of $1.25 on Sept 30, the annualised distribution yield is 6.6 per cent. The counter closed one cent up at $1.25 yesterday.
CRCT’s gearing as at Sept 30 was 33.7 per cent, slightly higher than the 33 per cent a year ago.
CRCT’s manager, CapitaRetail China Trust Management, is optimistic about prospects.
According to its chairman, Victor Liew, China’s total retail sales of consumer goods rose 18.2 per cent year on year for the first eight months of the year.
Tony Tan, CEO of the manager, also said that there had been ‘positive rental renewal momentum’ at CRCT’s malls.
PST – BT
PST Q3 profit rises 3% to US$7.2m
PACIFIC Shipping Trust’s distribution per unit for the third quarter ended Sept 30, 2010 inched up 1.7 per cent to 0.832 of a US cent, up from 0.818 US cent for the same period a year ago.
Distributable income also barely budged, up 2 per cent from US$6.89 million to US$7.04 million for Q3.
For the nine months ended Sept 30, 2010, distributable income stayed flat at US$20.08 million against last year’s US$20.06 million.
Income to be distributed for the quarter stood at US$4.9 million, but was 13 per cent lower for the nine-month period, at US$14.3 million due to an increase in the income to be retained for working capital.
For the nine months ended Sept 30, 2010, income to be retained for working capital more than doubled year on year, from US$6 million to US$13.9 million.
Gross revenue from its 12 long-term charter vessels also stayed flat at US$15.6 million and US$45.9 million for the quarter and nine-month period, respectively.
Net profit crept up 3 per cent to US$7.2 million for the quarter and up one per cent to US$20.5 million for the first three quarters of 2010.
The trust has been going on a spree of sorts this year, buying two capesize bulk carriers in late-June and two multi-purpose vessels this month.
The multi-purpose vessels will be backed by a 10-year time charter contract with Cosco Xiamen, which will boost Q3 2012 revenue.
‘We are pleased to have delivered on our promise to unitholders to widen our charterer and asset base,’ said Teo Choo Wee, the acting chief executive officer of PST Management Pte Ltd, the trustee-manager of the trust.
‘The fact that we could conclude these two deals recently is a testament to our strong credibility in the shipping fraternity.’
The trust is expecting its gross revenue to increase next year, helped along by 10-year time charters for two 180,000 deadweight tonne capesize bulk carriers to Jiangsu Shagang Group Co Ltd.
‘We have been proactively managing charter revenue to ensure that PST more than replaces the revenue from vessels that will be coming off-charter,’ said Mr Teo.
The books’ closure date is Oct 28 and payment will be made on Nov 29.
MIT – BT
MIT’s IPO 38 times oversubscribed
Trust expected to raise as much as $1.19b in gross proceeds from IPO
Mapletree Industrial Trust’s (MIT) initial public offering (IPO) saw a strong take-up rate with an oversubscription of about 37.9 times, led by demand from institutional players.
The take-up means that more than $20.1 billion in total of application money was made available for the IPO, MIT said yesterday.
MIT is expected to raise as much as $1.19 billion in gross proceeds from its IPO, if an overallotment option of 91.75 million units is exercised.
Mapletree is selling 1.28 billion MIT units at 93 cents apiece. This includes some 595 million units, comprising 489 million units that were placed out and 106 million units that were sold to the public.
Six cornerstone investors, namely AIA, Prudential Asset Management (Singapore), Henderson Global Investors, Columbia Wanger Asset Management, US investment firm DE Shaw and Dutch pension fund APG, will subscribe for a separate 323 million units.
Mapletree’s two subsidiaries, Mapletree Dextra Pte Ltd and Sienna Pte Ltd, will also subscribe for 359 million units, giving Mapletree a post-IPO stake of about 31 per cent if the greenshoe option is fully exercised.
The placement tranche of 489 million units was oversubscribed by 39.6 times, with a total value exceeding $18 billion.
The public tranche included 25.5 million units reserved for subscription by the directors, management, employees and business associates of Mapletree.
The remaining 80.6 million units, representing about 6.3 per cent of the total unit sale (excluding the overallotment), was about 27.7 times oversubscribed, translating to total value of about $2.1 billion.
MIT’s offer price represents an annualised distribution yield of 7.6 per cent for fiscal 2010, which is estimated to rise to 8 per cent for fiscal 2011.
It expects to pay out all of its distribution income to unitholders from listing until March 31, 2012, MIT said at a briefing last week.
MIT, which is the third real estate investment trust to be launched by Temasek Holdings’ Mapletree Investments, has a portfolio of 70 industrial properties in Singapore.
Global Logistic Properties (GLP) also saw firm interest in its IPO, which was more than 12 times oversubscribed.
Out of the 88,393 public offer applications for GLP, 85,136 applications, or 96 per cent, were successful ones.
The balloting results of the GLP applications also threw up some startling numbers. It showed that there were 22 successful applicants from the public who had initially applied for at least one million shares, coughing up at least $1.96 million upfront.
They were eventually allotted 10,000 shares each.
Shares of GLP continued their uptrend yesterday, gaining 5.53 per cent or 12 cents to end at $2.29. It was the most active stock on the Singapore Exchange, with 262 million shares changing hands.
Trading of the units of MIT is expected to start tomorrow at 2pm.