LMIR – BT

LMIR Trust income dips despite stable rents

It cites depreciation of rupiah, drop in casual leasing and other income

LIPPO-MAPLETREE Indonesia Retail Trust (LMIR Trust) yesterday reported a 12.5 per cent year-on-year drop in distributable income to $13.9 million, for its second quarter.

Distribution per unit also fell to 1.3 cents for the quarter ended June 30, from 1.5 cents for last year’s Q2.

Gross revenue fell 20.3 per cent to $19.5 million. Reasons include the depreciation of the Indonesian rupiah, reduced casual leasing income, and lower car park and miscellaneous income as retailers cut back on publicity expenses such as signage fees, the trust’s manager said.

Property expenses dropped 14.3 per cent to $1.1 million.

Net property income fell 20.6 per cent to $18.5 million from $23.3 million one year back.

LMIR Trust’s property portfolio currently consists of eight retail malls and seven retail spaces located within other retail malls, all in Indonesia.

Its portfolio occupancy rate held steady at 95 per cent in the second quarter, ‘significantly better than the industry average’, the trust’s manager said.

In Q2, average monthly gross rents remained stable in Jakarta, where most of LMIR Trust’s portfolio properties are situated.

Some new properties, now under construction and expected to come onto the market in the coming year, could keep rental rates soft for the rest of this year, but will most likely affect the upper category of retail malls.

LMIR Trust’s management said that ‘the middle target market for its malls and their choice locations will allow its portfolio to be resilient, particularly in light of Indonesia’s economic outlook’.

Its gearing as at June 30 was 12.1 per cent, with total borrowings of $125 million for a tenure of four years from March 31.

LMIR Trust’s unit price closed one cent up, at 44 cents yesterday.