SINGAPORE (Aug 2): The manager of Lippo Malls Indonesia Retail Trust (LMIR Trust) has declared distribution per unit (DPU) of 0.60 cent for the 2Q19 ended June, some 1.7% higher than DPU of 0.59 cent a year ago.
Distributable income rose 4.0% to $17.5 million in 2Q19, from $16.8 million a year ago.
Total gross revenue jumped 29.7% to $68.3 million during the quarter, from $52.7 million in the corresponding quarter last year.
This was due mainly to higher service and utilities recovery charges collected directly from tenants, which surged to $23.7 million in 2Q19, from $5.7 million a year ago.
Gross rental income fell 5.8% to $39.0 million, dragged by lower income from Lippo Plaza Batu and Palembang Icon upon expiry of the master leases in July 2018 and lower casual leasing income in 2Q19.
Total property operating expenses more than doubled to $24.3 million in 2Q19, from $9.5 million in 2Q18.
This was mainly due to higher property operating and maintenance expenses, which more than quadrupled to $20.5 million during the quarter.
Consequently, net property income (NPI) edged up to $44.0 million, just 1.9% higher than NPI of $43.2 million a year ago.
The improved performance was further aided by a stable Indonesian rupiah, which depreciated at a lower year-on-year quantum of 0.6% against the Singapore dollar in 2Q19.
As at end June, cash and cash equivalents stood at $113.8 million.
“Despite the current challenging macroeconomic and operating landscape, the trust has delivered a second consecutive quarter of creditable performance buoyed by the recovering Indonesian rupiah against the Singapore dollar, the disciplined cost management initiatives that we have implemented during the year, and the strength of our underlying portfolio,” says James Liew, chief executive officer of the manager.
Liew notes that LMIR Trust saw its occupancy rate improve by 0.7 percentage points q-o-q to 92.2% in 2Q19 – ahead of the industry average of 80.7%.
He adds that the trust also achieved a positive rental reversion of 4.4% as of year-to-date June 2019.
“Other than organic growth, we continue to look at growing inorganically through the acquisition of quality assets to bolster our portfolio and generate long-term value for our unitholders,” Liew says.
Units in LMIR Trust closed half a cent lower, or down 2.1%, at 23.5 cents on Thursday before the results announcement.
