SINGAPORE (Jan 31): The manager of Aims APAC REIT (AA REIT) has reported distribution per unit (DPU) of 2.50 cents for 3Q20 ended December, unchanged from the previous year.
This brings DPU for 9M20 to 7.50 cents, the same as the corresponding period last year.
Gross revenue for the quarter came in at $29.5 million, some 1.2% lower than $29.8 million in 3Q19. This was primarily attributable to the conversion from master leases to multi-tenancy leases at two of the group’s properties - 1A International Business Park in November 2019 and one phase of the property at 30 Tuas West Road in August 2019.
The group also booked lower rental and recoveries at 20 Gul Way and 15 Tai Seng Drive. The final phase of 20 Gul Way had reverted from master lease to multi-tenancy leases during the quarter.
However, the decrease was partially offset by the full quarter rental contribution from Boardriders Asia Pacific HQ, which was acquired by the group recently.
Property operating expenses for the quarter fell 38.8% to $6.3 million from $10.4 million the previous year. This was on the back of a property tax refund for 20 Gul Way of S$2.3 million due to changes in its annual value assessed by the Inland Revenue Authority of Singapore.
Correspondingly, net property income increased by 2.8% to $23.1 million from $22.5 million in 3Q19. The group’s net property income margin increased to 78.5% in 3Q20 compared to 65.2% in 3Q19.
AA REIT’s share of profits of joint venture surged to $47.4 million from $3.5 million in 3Q19. This was due to the group’s 49% stake in Optus Centre in Macquarie Park, New South Wales, Australia, as well as the share of revaluation surplus recognised from the valuation of the underlying property.
As at end-December, cash and cash equivalents stood at $21.8 million.
Earnings per unit on a diluted basis came in at 7.73 cents.
In its outlook statement, AA REIT note that a number of uncertainties continue to cloud the global economy, including the novel coronavirus, US-China trade tensions and Brexit.
“Negative developments on these issues could cause further disruptions to global supply chains and the Singapore economy would likely be impacted due to its dependence on trade and manufacturing activities. However, being a regional hub, Singapore could potentially benefit from businesses reassessing their supply chains and sourcing locations,” says AA REIT.
“Against this external backdrop, the Manager remains focused on anticipating and adapting to these changes by building a diversified and resilient portfolio through unlocking organic growth and strategic acquisitions to ensure the creation of sustainable, long-term value for unitholders,” adds the group.
As at 10.03am, units in AA REIT are trading two cents higher, or 1.4% up, at $1.45.
