MLT – BT

MapletreeLog DPU rises 9.7% in Q4

MAPLETREE Logistics Trust (MLT) saw distributable income increase 12.2 per cent to $41.3 million for the fourth quarter ended Dec 31, 2011, from $36.8 million the year before.

However, distribution per unit (DPU) grew at a slower rate due to a larger number of units from an equity fund-raising exercise back in Q2 2010. Q4 distribution per unit (DPU) was 1.70 cents, 9.7 per cent higher than last year’s 1.55 cents. The Q4 DPU includes a distribution of 0.03 cent from divestment gains.

Its Q4 gross revenue climbed 17.8 per cent year-on-year to $71.9 million in the quarter ended Dec 31, mainly due to contributions from four properties acquired in the financial year and stronger contributions from existing assets on the back of positive rental reversions and improved occupancies.

With a larger asset base and a greater number of multi-tenanted properties, property expenses also climbed 43.9 per cent to $10.3 million from $7.2 million previously.

Consequently, MLT’s net property income for the period grew 14.4 per cent to $61.6 million.

On a year-to-date basis, MLT’s gross revenue grew 22.6 per cent to $268.3 million from $218.9 million a year back, largely due to contributions from 14 properties acquired back in FY2010, in addition to four other assets acquired in FY2011.

Not surprisingly, borrowing costs also rose by $5.4 million due to funds required for acquisition activities.

This resulted in the total amount distributable increasing by 21.9 per cent to $158.6 million compared to $130.1 million last year.

This translates to a DPU of 6.54 cents – including 0.06 cent for the period from the divestment gains of 9 Tampines and 39 Tampines.

Gearing-wise, aggregate leverage as at end last year was about 41 per cent, largely unchanged from the prior quarter, and with ‘little refinancing risk’ this year, said management.

Overall portfolio occupancy also remained at a healthy 98.8 per cent while the weighted average lease to expiry was around six years, implying stable cash flows and regular income streams in the periods ahead.

MLT invests in a portfolio of income producing logistics real estate assets which encompasses 98 properties valued at a book value exceeding $3.7 billion as at Dec 31.

Yesterday, the counter closed 1.5 cents, or 1.7 per cent, lower at 86 cents.

During a teleconference yesterday evening, cost was noted to be a key challenge going forward, especially in countries such as China due to rising wage levels.

However, with a continued focus on ‘yield optimisation by active asset and lease management’, Richard Lai, chief executive officer of the manager, remains confident that MLT will continue to deliver decent returns.

On the acquisitions end, Mr Lai noted that they are ‘not rushing’ into any particular deal and will maintained a ‘disciplined approach’.