CRCT – BT

CRCT does better in Q1, sees rosy outlook in China

CAPITARETAIL China Trust (CRCT) yesterday posted improved results for the first quarter ended March 31.

Gross revenue climbed 11.1 per cent year-on-year to 159.1 million yuan (S$30.4 million) largely from higher occupancy rates and higher tenant sales at some malls.

Net property income increased 13.6 per cent to 106.6 million yuan.

The results were slightly eroded by the Singapore dollar’s appreciation against the yuan. Converted to Sing dollars, gross revenue grew a smaller 4.7 per cent while net property income rose 7.1 per cent.

Income available for distribution was $13.5 million, up one per cent from a year ago. Distribution per unit (DPU) for the period was 2.15 cents, above last year’s 2.14 cents.

On an annualised basis, Q1’s DPU was 8.72 cents. Seen against CRCT’s closing unit price of $1.25 on March 31, the annualised distribution yield is 7 per cent.

The counter lost one cent on the stock market yesterday to end trading at $1.26.

CRCT is confident about the outlook for China’s retail market, pointing out that the Chinese government committed to boosting domestic consumer demand in its 12th Five-Year Plan in March.

‘Retail sales in China grew 15.8 per cent year-on-year in the first two months of 2011. Retail sales, driven by growing urbanisation and rising disposable income, are expected to remain robust,’ said Victor Liew, chairman of CRCT’s manager.

CRCT added that the authorities are also investing more in transport infrastructure and public transport, which is expected to improve accessibility and ‘retail footfall’.

CRCT’s portfolio comprises eight malls across five cities in China.

It said it will explore yield-accretive acquisitions to expand its portfolio, and continue rolling out asset enhancement initiatives. Its gearing in the first quarter was 32.6 per cent, up from 31.1 per cent in the fourth quarter of 2010.