SINGAPORE (Oct 24): The manager of Cache Logistics Trust has declared a distribution per unit (DPU) of 1.541 cents for the 3Q17 ended Sept, down by 12.8% from 1.767 cents in the same period a year ago.
Excluding the effect of the rights Issue, DPU was marginally lower at 1.818 cents compared to the same period in 2016.
The lower quarterly DPU was mainly attributable to lower income from operations and an enlarged number of units in issue due to the recently-completed $102.7 million rights issue, says the manager in the results filing for CacheLog on Tuesday.
Gross revenue for the quarter came in 2.2% lower at $27.4 million compared to $28 million previously, on the divestment of Cache Changi Districentre 3 and lower income from 51 Alps Ave due to the holding arrangement in place.
This was partially offset by higher contributions from DHL Supply Chain Advanced Regional Centre, Cache Cold Centre and the Australia portfolio.
For similar reasons, net property income (NPI) fell 3.3% to $21.3 million from $22.1 million previously, exacerbated by the conversion of 40 Alps Ave from a single-tenanted/triple-net master lease structure to a gross rent lease structure in a soft rental market.
The above resulted in distributable income of $16.4 million, 0.8% down from the $16.6 million of distributable income reported a year ago.
As at end-Sept, CacheLog’s portfolio committed occupancy remained strong at 97.3% and the portfolio weighted average lease to expiry (WALE) was 3.3 years.
Post its repayment of borrowings on Oct 16 with funds raised from CacheLog’s recent rights issue, the trust’s aggregate leverage was reduced to 35.7% with enlarged debt headroom of approximately $213.4 million.
CacheLog’s manager says it will remain focused on proactive lease and asset management to maintain high occupancy and to optimise portfolio returns. It also intends to continue pursuing growth opportunities for strategic acquisitions as part of its portfolio rebalancing strategy to enhance the overall quality of the trust’s portfolio.
“Although our recently completed rights issue contributed to the drop in DPU this quarter due to the increase in the issued units base, we now have a stronger balance sheet and larger debt headroom to facilitate future growth,” says Daniel Cerf, CEO of the manager.
“We will forge ahead with our proactive portfolio rebalancing and growth strategy where we continue to seek growth opportunities, particularly in Australia, to enhance the portfolio returns over time,” he adds.
Units in CacheLog closed flat at 84 cents on Tuesday.
