Fraser Commercial Trust & Mapletree Logistics Trust – Latest Results!

• Distributable income to Unitholders 3QFY14 grew 2.9%
  to S$14.8 million. 
• DPU of 2.19 cts same yoy. 
• Est FY14 DPU of 8.6c 
• Est Dividend yield 6.1% (last close price S$1.44) and 6.6%
  (at my cost).
• P/E ~6.6 and P/B~0.92 

China Square shines while Australia Drags

• YoY NPI gains of 10% for China Square Central and 7%
  for Market Street were offset by NPI declines at Caroline Chisholm Centre (-10%)
  and Central Park (-2%) respectively.
• Lower NPI mainly due to the weaker AUD and slightly
  higher expenses for Caroline Chisholm Centre incurred for repair and
  maintenance works undertaken.
• Despite the slightly lower NPI, savings in the CPPU
  distribution led to the higher distributable income in 3QFY14. 

Strong Occupancy & Healthy WALE

• The occupancy rates in S’pore and Australia were 98.4%
  and 97.3%, respectively. China Square Central attained 100.0% committed
  occupancy and continues to benefit from the AEI completed in the prior year. 
• The portfolio WALE of about 3.9 years continues to be
  anchored by the long WALE of Caroline Chisholm Centre of 11.0 years.
• Demand for space in the properties was supported by
  tenants from diverse sectors.

Strong re-financing

• Net cash flows from the Australian properties have
  been hedged to manage the impact of the weaker Australian dollar.
• Interest coverage ratio is at 4.4 times and an all-in
  interest rate of 2.8% per annum.

Outlook

• Singapore properties continue to enjoy the uptrend in
  rentals, achieving positive rental reversions of between 10.7% to 11.5% for leases
  which commenced in 3QFY14. 
• Australia Central Park achieved an 87.0% increase in
  rental reversion for a lease which commenced in 3QFY14, as the new lease
  replaced an expired long lease which was contracted more than 10 years ago.
• Anticipate significant positive rental reversions of
  Alexandra Technopark in FY15, as underlying leases were renewed at $3.6psf
  average passing gross rents vs the master lease net rent of S$1.8psf.

FCOT
3Q14 Results here

• Distributable income to Unitholders 1Q FY14/15 grew 6%
  to S$46.6 million.
• DPU grow 6% to 1.90 cts vs 1.80 cts yoy.
• Est FY14 DPU of 7.6c
• Est Dividend yield 6.5% (last close price S$1.16) / 6.9%
  (at my cost).
• P/E ~10.1 and P/B~1.20.

Strong Performance from New Properties / Positive Rental
Reversions

• MLT recorded higher gross revenue of S$81.0 million (7%
  incr).
• NPI for 1Q FY14/15 increased by 6% to S$69.0 million
• Primarily due to contributions from Mapletree Benoi
  Logistics Hub and one South Korea property acquired in 2Q FY13/14.
• Positive rental
  reversions mainly in HK and S’pore, as well as higher revenue from four Japan properties
  which completed the installation of solar panels last year. 

Recent Acquisitions

• Recent acquisitions of the Iskandar Malaysia property
  and Korean Daehwa Logistics Centre with both expected to contribute to MLT’s DPU
  in future quarters. 
• Also commenced the redevelopment of 5B Toh Guan Road
  East.
• MLT’s portfolio increased to 113 properties with a
  book value of S$4.3 billion. Of the 113 properties, 52 are in Singapore, 22 in
  Japan, 14 in Malaysia, 8 in Hong Kong, 7 in China, 9 in South Korea and 1 in
  Vietnam. 

Strong Occupancy & Healthy WALE

• Portfolio occupancy rate at 97.6% in 1Q FY14/15. 
• WALE ~4.7 years with 46% of the leases having
  expiry dates in FY17/18 and beyond. 

Strong re-financing / Risk management

• Aggregate leverage at 33.4% up slightly from 33.3%. 
• Ave duration of debt ~3.4 years and weighted ave
  interest at 2.0%.
• 76% of total debt hedged to fixed rate due to
  additional interest rate swap, tenors of up to 7 years.
• 88% of FY14/15 income is SGD hedged into / derived SGD
  to mitigate Forex risk.
• Interest coverage ratio at 8.4 times.

Outlook

• Demand for logistics properties in MLT’s markets
  remains stable.
• HK, CN, MY, JP: firm demand underpinned by growing
  domestic consumption and improving global economy, coupled with tight supply.
• SG: leasing activities still healthy but customers
  have more choices with new developments coming onstream.
• Expects short term pressure on occupancy rate and
  rising property expenses, with more conversion of single-user assets to Multi-Tenanted
  Building conversions coming through.
• MLT will selectively pursue strategic acquisitions and
  unlock value via AEI, and recycle capital released from divestment of lower
  yielding assets into higher yielding assets

MLT
1Q FY14/15 Results here