2 REITS That Have Delivered Mixed Performances Recently
- Original Post from The Motley Fool Sg

It’s earnings season again.Given many REITs are reporting their results at the same time, it would be useful to group them into three categories – good, bad and mixed.


In this article, I will look at two REITs that have recently delivered mixed financial results.


We will start with SPH REIT (SGX: SK6U).


As a quick introduction, SPH REIT is an owner of two retail malls in Singapore, namely, Paragon and The Clementi Mall. It also owns a leasehold interest in The Rail Mall. Newspaper publisherSingapore Press Holdings Limited (SGX: T39) is the sponsor, manager, and large unitholder of SPH REIT.


For the quarter ended 30 November 2018, SPH REIT reported that gross revenue grew marginally by 0.6% year-on-year to S$53.8 million. Yet, net property income (NPI) fell by 1.0% to S$41.8 million. The weaker performance was due to lower revenue at Paragon, cushioned by higher contribution from The Clementi Mall and The Rail Mall. Distribution per unit (DPU) was flat as compared to a year ago at 1.34 cents.


As at 30 November 2018, the REIT clocked in a gearing ratio of 26.3% while its occupancy rate stood at 99.2%.


Susan Leng, chief executive of SPH REIT’s manager, said:


“We are pleased that SPH REIT continued to deliver steady distribution with overall positive rental reversion of 9.7% for 1Q 2019.


In line with our strategy of acquiring yield-accretive retail properties that provide sustainable returns to unitholders, SPH REIT completed the acquisition of 85% stake in Figtree Grove Shopping Centre, with our joint venture partner, Moelis Australia Limited holding the remaining stake. The property is an established sub-regional shopping centre in Wollongong, New South Wales, Australia and is a strategic fit with SPH REIT’s portfolio of quality assets. This acquisition provides SPH REIT with the opportunity to further create value and continue to deliver long term returns for unitholders. The full contribution from Figtree Grove Shopping Centre is expected in the second half of the year.”


The next REIT on the list is Suntec Real Estate Investment Trust (SGX: T82U).


As a quick introduction, Suntec REIT is one of the largest REITs in Singapore and currently has interests in retail malls and offices in Singapore and Australia. Its portfolio includes Suntec City, one-third interest in One Raffles Quay, a commercial building in Sydney and a 50% stake in Southgate Complex in Melbourne.


Chong Kee Hiong, chief executive of Suntec REIT’s manager, commented:


“We are pleased to have recorded a higher distributable income for 2018. Suntec City Mall has performed well with improved occupancy, higher footfall and tenants’ sales. The acquisition of the additional 25% interest in Southgate Complex also contributed to the stronger performance. This was however offset by higher financing costs, transitory downtime for the Singapore office leases and the weakened Australian dollar.”


For the quarter ended 31 December 2018, Suntec REIT reported that gross revenue improved 7.0% to S$93.5 million while NPI rose 2.3% to S$60.7 million. The higher NPI was mainly due to higher contribution from the REIT’s retail operations and 177 Pacific Highway. Yet, Suntec REIT’s DPU was down by 0.5% year-on-year to 2.59 cents.


As of 31 December 2018, the REIT’s gearing stood at 38.1% while its committed occupancy rate for its office and retail propertieswas 98.7% and 99.1%, respectively.


Stop worrying about the uncertain REITs market with our new Complete Guide To Buying The Best Singapore REITs. We give you 3 quick ways to easily value your REITs so you save tons of research time. Value your REITs today so you know exactly when to buy, sell or hold. Simply enter your email here and we will rush the 42-page PDF immediately to your inbox...for FREE!


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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn't own shares in any companies mentioned.


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Acquisition-Led Growth for SPH REIT’s Second Quarter
- Original Post from The Motley Fool Sg

SPH REIT (SGX: SK6U) is a retail real estate investment trust (REIT) with interests in Paragon, The Clementi Mall and The Rail Mall in Singapore. At the end of 2018, the REIT ventured into Australia by acquiring an 85% stake in Figtree Grove Shopping Centre, a freehold shopping mall in Wollongong, New South Wales, Australia.


On Friday, SPH REIT announced its financial results for the second quarter ended 28 February 2019 (2Q2019). Here’s a quick rundown on the financial figures from the latest quarter:


1. Gross revenue for 2Q2019 grew 8.5% to S$58.1 million, up from S$53.6 million last year. SPH REIT’s gross revenue improved for the quarter largely due to contributions from The Rail Mail and Figtree Grove Shopping Centre, which were added to the portfolio on 28 June 2018 and 21 December 2018 respectively.


2. Net property income (NPI), likewise, increased by 8.5% to S$45.9 million.


3. Distribution per unit (DPU) inched up by 0.7% to 1.41 Singapore cents, up from 1.40 Singapore cents a year back.


4. For the REIT’s first half period, gross revenue improved by 4.5% to S$111.9 million, NPI grew 3.8% to S$87.6 million while DPU went up by 0.4% to 2.75 Singapore cents.


5. As of 28 February 2018, the net asset value (NAV) per unit stood at S$0.94.


6. SPH REIT had a gearing ratio of 30.1% at the end of the reporting quarter. The figure rose from 26.3% at the end of August last year due to new loans taken up to finance the acquisition of Figtree Grove Shopping Centre. The average cost of debt was 2.88% per annum with the weighted average term to maturity at 2.1 years.


7. The following chart shows SPH REIT’s debt maturity profile, which is well spread out:



Source: SPH REIT 2Q2019 earnings presentation


8. Occupancy at SPH REIT’s properties remained high at 99.2% at the end of the second quarter. The overall portfolio registered a positive rental reversion of 8.4% for new and renewed leases, with Paragon achieving an 8.6% rental reversion. The REIT manager added that tenant sales as a whole have “continued to register growth”.


9. Tenant sales at Figtree Grove Shopping Centre were around 48% higher than the benchmark for malls in the same category. The shopping mall’s major anchor tenants include a 24-hour Kmart, Coles and Woolworths supermarkets. The mall’s committed occupancy stood at 99.3%.


10. SPH REIT has a right of first refusal on Singapore Press Holdings Limited’s (SGX: T39) The Seletar Mall property, which has maintained a high occupancy rate since its opening. Singapore Press Holdings is a sponsor of SPH REIT. The REIT manager is also exploring “acquisition opportunities that will add value to SPH REIT’s portfolio and improve returns to Unitholders”.


At SPH REIT’s current unit price of S$1.07, it has a price-to-book ratio of 1.1 and a distribution yield of 5.2%.


Maximise dividends on your REITs with our brand-new Complete Guide To Buying The Best Singapore REITs. We reveal everything we think you need to know about finding the best REITs that hands you a fat dividend cheque ...even if you have no REITs experience at all! Get instant access to your 100% FREE, actionable, 42-page PDF guide here.


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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Sudhan P doesn’t own shares in any companies mentioned.


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SPH REIT’s Share Price Is Close To A 52-Week Low: Is It Cheap Now?
- Original Post from The Motley Fool Sg

SPH REIT‘s (SGX: SK6U) share price of S$1.02 currently is just 4% higher than a 52-week low of S$0.98. For me, this raises a question: Is SPH REIT a cheap share at the moment? This question is important because if the REIT’s shares are cheap, it might be a good investment opportunity.


For a quick overview,SPH REITis an owner of three retail malls in Singapore: Paragon,Clementi Mall,and The Rail Mall. Newspaper publisher Singapore Press Holdings Limited (SGX: T39) is the sponsor, manager, and a large unitholder of the REIT.


There is unfortunately no easy answer to my question above. But, we can still obtain some insight by comparing SPH REIT’s current valuations with the market’s. The two valuation metrics I will focus on are the price-to-book (PB) ratio and distribution yield.


I will be using the average PB ratio and distribution yield for the 43 REITs that are currently listed in Singapore’s stock market (according to data from SGX Stock Facts)as the proxy for the market. The table below shows the valuation comparisons:




Source: SGX Stock Facts


We can see that SPH REIT’s PB ratio and distribution yield are both less attractive than that of the market – in other words, SPH REIT does not look cheap compared to the rest of its peers.


Stop worrying about the uncertain REITs market with our new Complete Guide To Buying The Best Singapore REITs. We give you 3 quick ways to easily value your REITs so you save tons of research time. Value your REITs today so you know exactly when to buy, sell or hold. Simply enter your email here and we will rush the 42-page PDF immediately to your inbox...for FREE!


More reading



The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.


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3 REITs Dishing Out Distributions on Wednesday
- Original Post from The Motley Fool Sg

There are three real estate investment trusts (REITs) going ex-dividend tomorrow. In other words, you need to own them before that day if you wish to receive their distributions. Let’s look further.


CapitaLand Mall Trust (SGX: C38U)


CapitaLand Mall Trust is a retail REIT which owns 15 shopping malls in Singapore, including Bugis Junction, Junction 8, and Plaza Singapura. CapitaLand Mall Trust was the first REIT to be listed in our city-state in July 2002.


The retail REIT is giving out 1.56 Singapore cents per unit for the period from 8 November to 31 December 2018.


For the full year ended 31 December 2018, CapitaLand Mall Trust’s gross revenue increased by 2.2% to S$697.5 million mainly due to an acquisition of the remaining 70% stake in Westgate that the REIT did not own. Meanwhile, net property income rose 3.2% to S$493.5 million, and distribution per unit (DPU) climbed 3% to 11.50 cents, up from 11.16 cents in 2017.


Richard R Magnus, chairman of the CapitaLand Mall Trust’s manager, commented on the REIT’s latest performance:


“Through proactive asset and capital management, CMT has delivered another set of creditable results for FY 2018 despite challenges in the retail industry. The resilient performance is a testament to the quality of CMT’s portfolio, which is underpinned by its attractive locations and diverse tenant mix. Cognisant of the challenges ahead – which include slowdown in the global and Singapore economies, uncertainty in the interest rate environment and competition from the completion of new shopping malls – we remain vigilant and will continually explore new ways to differentiate our malls from the competition and increase customer engagement.”


CapitaLand Mall Trust’s unit price closed at S$2.38 on Monday, translating to a price-to-book (PB) ratio of 1.2 and a trailing distribution yield of 4.8%.


Mapletree Commercial Trust (SGX: N2IU)


Mapletree Commercial Trust owns a portfolio of five office and retail assets in Singapore, including the country’s largest retail mall, VivoCity.


Mapletree Commercial Trust is dishing out 2.33 Singapore cents per unit for its fiscal third quarter.


Gross revenue for the REIT’s three months ended 31 December 2018 increased by 2.6% year-on-year to S$112.5 million mainly driven by higher contribution from VivoCity. Net property income grew 2.2% while DPU inched up by 1.3%, from 2.30 cents to 2.33 cents.


Sharon Lim, chief executive of Mapletree Commercial Trust’s manager, gave some updates on VivoCity in the earnings release:


“Year to date, we have embarked on a series of changes at VivoCity, and this includes some rigorous management of tenant mix particularly in 3Q FY18/19. As a result, there was a transitory impact on VivoCity’s tenant sales. These changes, however, will strengthen VivoCity’s appeal and long-term positioning. Momentum will pick up once the changes are completed.”


Mapletree Commercial Trust’s units last traded at S$1.78 apiece on Monday. At that price, the REIT had a PB ratio of 1.2 and a trailing distribution yield of 5.1%.


Suntec Real Estate Investment Trust (SGX: T82U)


Suntec REIT owns retail and office assets in Singapore and Australia. In our country, the REIT is the owner of the huge office and retail asset, Suntec City.


Suntec REIT is paying 2.59 Singapore cents per unit for its fourth quarter.


For the 2018 financial year, gross revenue improved by 2.6% year-on-year to S$363.5 million but net property income fell 1.4% to S$241.0 million. DPU for the year declined too, inching down by 0.2% to 9.988 Singapore cents.


Suntec REIT’s unit price last closed at S$1.93 on Monday, giving a PB ratio of 0.9 and a trailing distribution yield of 5.2%.


Maximise dividends on your REITs with our brand-new Complete Guide To Buying The Best Singapore REITs. We reveal everything we think you need to know about finding the best REITs that hands you a fat dividend cheque ...even if you have no REITs experience at all! Get instant access to your 100% FREE, actionable, 42-page PDF guide here.


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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. The Motley Fool Singapore has recommended units of Mapletree Commercial Trust and CapitaLand Mall Trust. Motley Fool Singapore contributor Sudhan P owns units in CapitaLand Mall Trust.


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10 Quick Things Investors Should Know About Suntec Real Estate Investment Trust’s Latest Earnings
- Original Post from The Motley Fool Sg

Yesterday,Suntec Real Estate Investment Trust (SGX: T82U), or Suntec REIT, released its 2018 fourth earnings update. As a quick introduction, Suntec REIT is one of the largest REITs in Singapore and currently has interests in retail malls and offices in Singapore and Australia.


Here are 10 things investors should know about Suntec REIT’s latest results:


1. Gross revenue for the reporting quarter improved 7.0% to S$93.5 million while net property income grew 2.3% to S$60.7 million.


2. Yet, the REIT’s distribution per unit (DPU) was down by 0.5% year-on-year to 2.59 cents.


3. Based on Suntec REIT’s 2018 full year DPU of 9.988 cents and its unit price of S$1.88, the REIT has a trailing distribution yield of 5.3%.


4. As of 31 December 2018, the REIT’s gearing stood at 38.1%, which is still a safe distance from the regulatory ceiling of 45%.


5. The REIT’s portfolio had a committed occupancy rate for its office and retail propertiesof 98.7% and 99.1%, respectively, at end of the quarter.


6. The weighted average lease expiry (by net lettable area) for the office and retail properties was 3.80 years and 2.47 years, respectively.


7. In the latest quarter, income contribution from joint ventures was up by 6.6% year-on-year to S$22.7 million.


8. During the quarter, HSBC signed a 10-year lease at Marina Bay Financial Centre Tower 2. Fit out work for the bank’s new headquarters is expected to commence in the second half of 2019 with target occupation by April next year.


9. Suntec City Mall’s footfall and tenant sales grew 4.8% and 5.2%, respectively, on a year-on-year basis.


10. Here are some comments from the REIT on its outlook:


Source: Suntec REIT’s Presentation


Maximise dividends on your REITs with our brand-new Complete Guide To Buying The Best Singapore REITs. We reveal everything we think you need to know about finding the best REITs that hands you a fat dividend cheque ...even if you have no REITs experience at all! Get instant access to your 100% FREE, actionable, 42-page PDF guide here.


More reading



The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn't own shares in any companies mentioned.


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These 3 Singapore-Listed Companies Are Trading Close To Their 52-Week Lows
- Original Post from The Motley Fool Sg

I’m a value investor. So, I like to search for companies that are trading at good value. A list of stocks that are near their respective 52-week lows is a good place to start my search for a good reason.


These are the stocks that are either neglected or beaten down by investors. And, some of these stocks can be bargains in relation to their actual economic worth because market participants can at times react too negatively to certain companies that have sound long-term prospects but have experienced some short-term stumbles.


As such, I will screen for stocks that are trading near 52-week lows nearly once every week. There are many stocks that pop up on my screen each time I run it. So what are the companies that have shown up on this week’s list? Here are three of them:



Source: SGX.COM, StockFacts


Fraser and Neave Limited (SGX: F99), or F&N, is the first company that we will look at. As a quick introduction, F&N is a consumer group with expertise in the food and beverage (F&B), and publishing and printing sectors.


For the full year ended 30 September 2018, F&N reported that revenue was up 1.5% year-on-year to S$1.9 billion. Similarly, EBIT (earnings before interest and tax) grew by 25.6% as compared to a year ago to S$213.5 million. As a result, net profit attributable to shareholders (excluding exceptional items) grew 46.3% year-on-year to S$121.7 million. The improvement in profitability was driven mainly by the dairy segment.


F&N proposed a final dividend of 3.0 cents per ordinary share. Including interim dividend paid, the total dividend per share for the 2018 full-year was 4.5 cents, unchanged from the previous year.


Koh Poh Tiong, chairman of the F&N board executive committee, said:


“F&N’s financial performance for FY2018 was creditable, taking into account the challenging business environment. Increasing input costs, declining consumer confidence as well as evolving consumer preference and behavior continued to impact the businesses this year. Nevertheless, our strong brands and focus on efficiency and cost control enabled us to remain competitive through these challenging times. Together with the advantages of a regional footprint, scale and distribution capabilities, these factors will continue to provide F&N with the firm foundation to build on the success in the years ahead.”


The next company here is a small cap company,Samurai 2K Aerosol Ltd (SGX: 1C3).As a quick introduction, Samurai 2K is an aerosol coating specialist with a focus on high performance coating solutions for the automotive refinishing and refurbishing industry, focusing on selling its own brands such as Samurai, Kurobushi, Khameleon and a few others. Its products are distributed mainly in Malaysia, Indonesia, Thailand , Philippines and United States.


For the first six months ended 30 September 2018, Samurai 2K reported that revenue was up by 12.8% year-on-year to RM 38.9 million. Similarly, profit before interest and tax jumped 32.4% year-on-year to RM 10.4 million. Consequently, net profit attributable to shareholders surged 30.8% to RM 8.4 million. The stronger performance was due to higher sales volume in Malaysia, as well as increase in average selling price by 12% in Malaysia and Indonesia.


Going forward, the group is exploring an expansion into India. Here’s what the company said:


“The Group is currently exploring expansion into the India market which is still an untapped market for aerosol spray paint. Every day there are 20 million new registered motorcycles on the road. The India market is about 5 times bigger than Indonesia market. The Company will make the necessary announcement on SGXnet as and when there are any material updates”


SPH REIT (SGX: SK6U) is the last company that we will look at in this article.As a quick introduction, SPH REIT is an owner of two retail malls in Singapore, namely, Paragon and The Clementi Mall. It also owns a leasehold interest in The Rail Mall. Newspaper publisher Singapore Press Holdings Limited (SGX: T39) is the sponsor, manager, and large unitholder of SPH REIT.


For the quarter ended 30 November 2018, SPH REIT reported that gross revenue grew marginally by 0.6% year-on-year to S$53.8 million. Yet, net property income fell by 1.0% to S$41.8 million. The weaker performance was due to lower revenue at Paragon, cushioned by higher contribution from The Clementi Mall and The Rail Mall. Distribution per unit (DPU) was flat as compared to a year ago at 1.34 cents.


Susan Leng, CEO of SPH REIT’s manager, said:


“We are pleased that SPH REIT continued to deliver steady distribution with overall positive rental reversion of 9.7% for 1Q 2019.


In line with our strategy of acquiring yield-accretive retail properties that provide sustainable returns to unitholders, SPH REIT completed the acquisition of 85% stake in Figtree Grove Shopping Centre, with our joint venture partner, Moelis Australia Limited holding the remaining stake. The property is an established sub-regional shopping centre in Wollongong, New South Wales, Australia and is a strategic fit with SPH REIT’s portfolio of quality assets. This acquisition provides SPH REIT with the opportunity to further create value and continue to deliver long term returns for unitholders. The full contribution from Figtree Grove Shopping Centre is expected in the second half of the year.”


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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn't own shares in any companies mentioned.


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