SPH REIT’s Latest Earnings: What Investors Should Know
- Original Post from The Motley Fool Sg

SPH REIT (SGX: SK6U) is a retail real estate investment trust (REIT) that has interests in Paragon and The Clementi Mall. The REIT’s sponsor is media giant, Singapore Press Holdings Limited (SGX: T39).
Yesterday, SPH REIT announced its financial results for the year ended 31 August 2017 (FY2017). The reporting period was from 1 September 2016 to 31 August 2017.
Here’s a quick rundown on the financial figures from the earnings release:
1. Gross revenue for FY2017 grew 1.5% year-on-year to S$212.8 million, due to higher rental income.
2. Net property income (NPI) increased 4.5% to S$168.1 million, largely on the back of better cost controls.
3. FY2017’s distribution per unit (DPU) came in at 5.53 cents, edging up from 5.50 cents seen a year back.
4. The net asset value (NAV) per unit was at S$0.95, as at 31 August 2017. This is a slight increase from FY2016’s figure of S$0.94.
Both Paragon and The Clementi Mall continued having 100% occupancy despite the muted retail environment. Rental reversion for the portfolio was at a commendable 1.2% for new and renewed leases in FY2017.
It was a mixed bag, however, if we home in on the individual properties in the portfolio.
Rental reversion at Paragon was down 0.8%. Its visitor traffic was maintained at 18.3 million while tenant sales grew by 2.1% to S$675 million. The occupancy cost was at 19.6%.
Over at The Clementi Mall, it had a positive rental reversion of 3.7%. Visitor traffic fell 0.3% to 29.9 million while tenant sales declined by 5.8% to S$225 million. The occupancy cost came in at 15.8%.
As at 31 August 2017, the trust had a gearing ratio of 25.4%, with an average cost of debt at 2.82%. 85.9% of the S$850m debt facility was on a fixed rate basis, helping to mitigate the risks from interest rate rises in the future. The weighted average term to maturity of the outstanding debt is at 2.1 years.
Looking ahead, Susan Leng, Chief Executive Officer of the REIT’s manager, said:
“[W]e will continue to invest in asset enhancement to remain relevant and improve shopper experience. During the year, Paragon commenced the second phase of its Air Handling Units decanting project involving the creation of additional lettable area at higher-yielding retail space. This project is expected to be completed by mid-2018.
Concurrently, other opportunities to create value have been identified and details of these projects in the pipeline would be released at the appropriate time.
Barring any unforeseen circumstances, SPH REIT’s two high quality and well-positioned retail properties in prime locations are expected to remain steady and resilient.”
The Seletar Mall, which opened in November 2014, could be a potential acquisition target for SPH REIT. Singapore Press Holdings has given the right of first refusal to the REIT to acquire the property, which has a high occupancy rate since starting business.
SPH REIT ended Monday at S$1.005. This gives a historical price-to-book ratio of 1.06 and a trailing yield of 5.5%.
$SPHREIT(SK6U.SI) $SPH(T39.SI)

Read more
1 like

Recommended & Related Posts

10 Quick Things That Investors Should Know About SPH REIT’s Latest Earnings
- Original Post from The Motley Fool Sg

In early January, SPH REIT (SGX: SK6U) released its results for the first quarter of its fiscal year ending 31 August 2018 (FY2018). As a quick introduction, the REIT is an owner of two retail malls in Singapore, namely, Paragon and Clementi Mall. Newspaper publisher Singapore Press Holdings Limited (SGX: T39) is the sponsor, manager, and a large unitholder of SPH REIT.
Here are 10 things about SPH REIT’s results that investors may want to know about:
1. Gross revenue for the reporting quarter grew 1.7% year-on-year to S$53.48 million, while net property income improved by 1.9% to S$42.19 million.
2. But, the distribution per unit (DPU) remained flat at 1.34 cents compared to a year ago.
3. Based on SPH REIT’s annualised DPU of 5.36 cents (from the aforementioned quarterly DPU of 1.34 cents) and its closing unit price of S$1.07 as of 19 January 2018, the REIT has an annualised distribution yield of 5.0%
4. As of 30 November 2017, SPH REIT’s gearing stood at 25.4%, which is low compared to the regulatory gearing ceiling of 45%.
5. Both of the REIT’s malls are at a 100% committed occupancy rate.
6. The weighted average lease expiry by gross rental income stood at 2.0 years at the end of the reporting quarter. 37.6% of the REIT’s leases are expiring in FY2018 and FY2019.
7. SPH REIT has the right of first refusal (ROFR) on one property, namely, Seletar Mall, which opened in November 2014.
8. There’s some bad news: Paragon recorded a rental reversion rate of -10.6% for new and renewed leases in the first quarter of FY2018, which were mostly committed a year ago. This represented 4.4% of Paragon’s net lettable area.
9. In the reporting quarter, visitor traffic to the REIT’s malls “remained steady.”
10. Here’s the outlook provided by the REIT in its earnings update:
“Based on advance estimates of the Ministry of Trade and Industry (MTI), the Singapore economy grew by 3.5% year-on-year in 2017. MTI expects the pace of economic growth to moderate in 2018 but remain firm with forecast of “1.5% to 3.5%”.
International visitor arrivals (IVA) recorded a 4.0% y-o-y growth in the first eight months of 2017. Tourism receipts grew by 10.0% to S$12.7 billion in the first half year of 2017.
The retail sales index (excluding motor vehicles) grew by 2.4% (year-on-year) in Q3 2017 and 2.5% in Q2 2017, reversing the decline in Q1 2017 (1.0%). Key trade segments registered increase in sales in Q3 2017, including departmental stores (4.6%), watches & jewellery(4.5%) and wearing apparel & footwear (4.1%).”
$SPHREIT(SK6U.SI) $SPH(T39.SI)

Read more
10 Quick Things That Investors Should Know About SPH REIT’s Latest Earnings
- Original Post from The Motley Fool Sg

In early January, SPH REIT (SGX: SK6U) released its results for the first quarter of its fiscal year ending 31 August 2018 (FY2018). As a quick introduction, the REIT is an owner of two retail malls in Singapore, namely, Paragon and Clementi Mall. Newspaper publisher Singapore Press Holdings Limited (SGX: T39) is the sponsor, manager, and a large unitholder of SPH REIT.
Here are 10 things about SPH REIT’s results that investors may want to know about:
1. Gross revenue for the reporting quarter grew 1.7% year-on-year to S$53.48 million, while net property income improved by 1.9% to S$42.19 million.
2. But, the distribution per unit (DPU) remained flat at 1.34 cents compared to a year ago.
3. Based on SPH REIT’s annualised DPU of 5.36 cents (from the aforementioned quarterly DPU of 1.34 cents) and its closing unit price of S$1.07 as of 19 January 2018, the REIT has an annualised distribution yield of 5.0%
4. As of 30 November 2017, SPH REIT’s gearing stood at 25.4%, which is low compared to the regulatory gearing ceiling of 45%.
5. Both of the REIT’s malls are at a 100% committed occupancy rate.
6. The weighted average lease expiry by gross rental income stood at 2.0 years at the end of the reporting quarter. 37.6% of the REIT’s leases are expiring in FY2018 and FY2019.
7. SPH REIT has the right of first refusal (ROFR) on one property, namely, Seletar Mall, which opened in November 2014.
8. There’s some bad news: Paragon recorded a rental reversion rate of -10.6% for new and renewed leases in the first quarter of FY2018, which were mostly committed a year ago. This represented 4.4% of Paragon’s net lettable area.
9. In the reporting quarter, visitor traffic to the REIT’s malls “remained steady.”
10. Here’s the outlook provided by the REIT in its earnings update:
“Based on advance estimates of the Ministry of Trade and Industry (MTI), the Singapore economy grew by 3.5% year-on-year in 2017. MTI expects the pace of economic growth to moderate in 2018 but remain firm with forecast of “1.5% to 3.5%”.
International visitor arrivals (IVA) recorded a 4.0% y-o-y growth in the first eight months of 2017. Tourism receipts grew by 10.0% to S$12.7 billion in the first half year of 2017.
The retail sales index (excluding motor vehicles) grew by 2.4% (year-on-year) in Q3 2017 and 2.5% in Q2 2017, reversing the decline in Q1 2017 (1.0%). Key trade segments registered increase in sales in Q3 2017, including departmental stores (4.6%), watches & jewellery(4.5%) and wearing apparel & footwear (4.1%).”
$SPHREIT(SK6U.SI) $SPH(T39.SI)

Read more
A Deeper Look at Singapore Press Holdings Limited’s Latest Earnings
- Original Post from The Motley Fool Sg

Singapore Press Holdings Limited (SGX: T39) is Asia’s leading media organisation with three business segments – Media, Property and Others. It also has a 26.84% stake in newly-listed education company, MindChamps PreSchool Ltd (SGX: CNE).
Last Friday, the media giant announced its financial results for the first quarter ended 30 November 2017. Here are 10 things investors should know from the earnings announcement:
1. Revenue for the quarter slumped 7% year-on-year to S$258.8 million, mainly due to a decline in sales at the Media segment.
2. Disruption to the industry hampered the Media segment’s revenue as it fell 13.9% year-on-year to S$173.9 million. Advertisement revenue came down 16.7% while circulation revenue sank 7.3% as compared to last year.
3. Revenue from the Property segment grew 1.2% to S$61.2 million due to higher rental income from its retail assets. Meanwhile, “Others” revenue surged 48.2% to S$23.6 million on the back of contributions from the newly-acquired Orange Valley business, Singapore’s largest private nursing home operator.
4. Dilution of interest on an associate’s initial public offering (IPO) listing helped to increase other operating income’s figure from S$3.6 million last year to S$8.5 million in the latest quarter.
5. Staff costs fell 4.9% year-on-year to S$85.8 million.
6. Net income for investments in the 2018 first quarter was S$12.4 million due to gains on divestment, as compared to the previous year’s loss of S$1.8 million.
7. Due to the above, net profit grew 32.1% year-on-year to S$60.4 million.
8. As at 30 November 2017, Singapore Press Holdings had cash and cash equivalents of S$397.7 million, and S$1.63 billion in total borrowings. This translates to a net debt position of S$1.23 billion, a deterioration from the S$1.19 billion in net debt that it had on 31 August 2017.
9. For the latest quarter, the firm generated an operating cash flow of S$62.3 million. With capital expenditure coming in at S$8.7 million, it raked in a free cash flow of S$53.6 million. A year ago, it had a higher free cash flow of S$76.2 million.
10. Looking ahead, Ng Yat Chung, chief executive of the company, said:
“We will roll out new products to deal with the disruption in the core media business. At the same time, we will continue to pursue other growth opportunities to diversify revenue streams.”
Singapore Press Holdings Limited’s shares are selling at S$2.70 now, up 2.7% as compared to Friday’s close.
$MindChamps(CNE.SI) $SPH(T39.SI)

Read more
The Singapore Market This Week: Singapore Press Holdings’ Earnings Focus
- Original Post from The Motley Fool Sg

The Straits Times Index (SGX: ^STI) hit a 52-week high of 3,524.65 points on Tuesday before retreating to close at 3,520.56 points for the week. As compared to the previous week, it added 0.9% for the five days.
Out of the 30 index constituents, 11 were in the red, with Singapore Press Holdings Limited (SGX: T39) leading the pack down. For the week, the media giant slumped 4% to S$2.63.
Singapore Press Holdings released its financial results for the first quarter ended 30 November 2017 after market close on Friday. It reported a revenue fall of 7% year-on-year to S$258.8 million but a net profit improvement of 32.1% to S$60.4 million. The bottom line was buoyed mainly by gains from the listing of an associate and gains on divestment.
MindChamps PreSchool Ltd (SGX: CNE), an associate that is 26.8% owned by Singapore Press Holdings, went public in November last year. The preschool operator could most likely be the firm that helped to boost some of the media firm’s earnings.
On the other hand, 15 blue-chip stocks were in the green while the remaining four were flat for the week. The biggest winner of the lot was Yangzijiang Shipbuilding Holdings Ltd (SGX: BS6).
The shipbuilder announced on Wednesday that it is setting up a company in Singapore that will be involved in leasing and chartering of vessel. Yangzijiang, through its wholly-owned subsidiary, Yangzijiang Shipping Pte Ltd, will have a 49.45% stake in the private company while several strategic partners will hold the remaining 50.55% equity interest. The investment would enable the group to “better position itself in shipbuilding industry when opportunities arise amid the current trend of consolidation”.
Elsewhere, the chief executive of Tat Hong Holdings Limited (SGX: T03), Roland Ng, and Standard Chartered’s private equity arm are looking to privatise the crane supplier at 50 cents per share.
The price is a 29.9% premium over the last undisturbed trading day’s price of 38.5 cents. The last undisturbed day, 20 September 2017, marked the final full market day before which the company said that it had been approached for a deal regarding its shares.
The offering vehicle is THSC Investments, which is owned jointly by the private equity arm of Standard Chartered and Ng’s TH60 Investments. THSC Investments views that privatising the firm would give it and Tat Hong more flexibility to manage Tat Hong’s business, and optimise the use of its management and resources.
Shares of Tat Hong closed at S$0.485 for the week, up 6.6%.
The SPDR STI ETF (SGX: ES3), an exchange-traded fund which can be taken as a proxy for the Straits Times Index, is now valued at a price-to-earnings ratio of 11.6 and has a distribution yield of 2.8%.
$YZJ Shipbldg SGD(BS6.SI) $MindChamps(CNE.SI) $STI ETF(ES3.SI) $Tat Hong(T03.SI) $SPH(T39.SI)

Read more
How Can Investors Partake in Vietnam’s Growth Without Buying Shares in the Country?
- Original Post from The Motley Fool Sg

Vietnam is one of the chief investment destinations in Southeast Asia. With the advantages of a strategic location, stable gross domestic product growth, and competitive labour costs, the country attracts a significant amount of investment capital every year.
So, it was not surprising that in 2017, several Singapore-listed companies either expanded their presence in, or set up shop in, Vietnam. Investors who wish to have an exposure to the country – one of the fastest growing economies in the world – can look to the aforementioned companies, without having to go through the trouble of finding Vietnam stocks to invest in.
One example is Thai Beverage Public Company Limited (SGX: Y92). Last month, an indirect-associate of Thai Beverage, Vietnam Beverage, won a bid to buy a 53.6% stake in Saigon Beer Alcohol Beverage Joint Stock Corp (Sabeco) for about 110 trillion dong (S$6.5 billion).
Sabeco, which is a state-owned Vietnamese brewer, has the largest market share in Vietnam’s beer market. It owns famous brands such as Saigon Beer and 333 Beer. Vietnam is the most prominent beer market in Southeast Asia, and the third largest in Asia.
The acquisition gives Thai Beverage access to extensive distribution networks in Vietnam, and helps to diversify its own products geographically. (Thai Beverage itself produces alcoholic beverages such as spirits and beer; its main market is currently Thailand) The deal will also help to solidify Thai Beverage’s position as the largest beverage company in Southeast Asia, which is in line with its Vision 2020.
Another example of a Singapore-listed company with exposure to Vietnam is Jardine Cycle & Carriage Ltd (SGX: C07). In November, the conglomerate invested US$1.2 billion for a 10% stake in Vinamilk, a leading dairy producer in Vietnam with a market share of approximately 58%. The investment is part of Jardine Cycle & Carriage’s strategy of investing in market-leading South-east Asian companies, and increases its business presence in Vietnam’s economy.
Jardine Cycle & Carriage is the second largest overseas investor in Vinamilk, after Thai Beverage’s unit, Fraser and Neave Limited (SGX: F99), which has a 19.2% stake.
Thirdly, we have education outfit MindChamps PreSchool Limited (SGX: CNE), which is 20% owned by Singapore Press Holdings Limited (SGX: T39). MindChamps announced recently that Vietnam’s Evergrande Group had signed a master franchise agreement, with plans to open 20 preschools and reading centres in Vietnam. In Singapore, MindChamps holds the largest market share for premium-range preschools, at 38.5%.
Last but not the least, Boustead Projects Ltd (SGX: AVM) is growing its presence in Vietnam through its wholly-owned indirect subsidiary, Boustead Projects Land (Vietnam) Co Ltd, or BPLV in short.
In December 2017, BPLV announced that it will be subleasing land from Thao Dien Real Estate Corporation to develop industrial leasehold properties in Vietnam. The land is located at Nhon Trach 2 – Nhon Phu Industrial Park in the Dong Nai Province, south-east of Ho Chi Minh City. It is within Vietnam’s south-east economic zone, and is in close proximity to Ho Chi Minh City, the most populated city in the country. These traits make the plot of a land a “strategic logistics location,” according to Boustead Projects.
Wong Yu Wei, Boustead Projects’ deputy chairman and executive director, had the following comments on the deal:
“We are encouraged by our growing presence in Vietnam, which follows shortly after our recent award of a design-and-build contract there for a power solutions manufacturing facility. Diversifying our business outside Singapore remains one of our core priorities and we will continue to work hard at our business development efforts in Vietnam and other target overseas markets.”
A Foolish Takeaway
Many companies that are listed in Singapore have businesses outside of the country. Investors who want to partake in Vietnam’s growth for 2018 and beyond can consider investing in Singapore-listed companies that already have a presence in Vietnam.
$Boustead Proj(AVM.SI) $Jardine C&C(C07.SI) $MindChamps(CNE.SI) $F & N(F99.SI) $SPH(T39.SI) $ThaiBev(Y92.SI)

Read more
Market Indices

There are more for you ...

View more and participate in our discussion now. It's FREE.

Creating an account means you’re okay with InvestingNote's Terms and Conditions