Mapletree Logistics Trust’s M44U 4QFY2023 distribution per unit (DPU) was unchanged y-o-y at 2.268 cents, while DPU was up 2.5% y-o-y to 9.011 cents in FY2023, for the 12 months to March 31. The amount of income support during the year was $1.092 million. Excluding income support, 4Q2023 DPU would be 2.245 cents and FY2023 DPU would be at 8.764 cents.
Although 4Q2023 revenue and NPI fell by 2.2% and 1.8% y-o-y respectively, due to the depreciation of the RMB, yen, Korean Won and Australian dollar as well as higher borrowing costs, DPU was flat due to benefits of foreign currency forward contracts to hedge distributable income, and distribution of $2.868 million of gains from the disposal of 3 Changi South Lane. Hence, in 4Q2023, the distributable income was up 1.1% y-o-y to $109.2 million.
Overall occupancy rate improved to 97.0% and the weighted average lease expiry (by net lettable area) was 3.1 years as at 31 March 2023. In 4Q FY22/23, leases for approximately 562,400 sq m were due for expiry, of which 90% were successfully renewed or replaced. The portfolio achieved a positive average rental reversion of 3.1%, contributed by renewal or replacement leases from across almost all of MLT’s markets.
In March 2023, MLT announced the proposed acquisitions of eight modern logistics assets in Japan, Australia and South Korea for $904.4 million; the potential acquisition of two modern logistics assets in China for $209.6 million; and the potential divestment of a non-core asset in Hong Kong SAR for $100.3 million. In March this year, MLT raised $200 million in a placement to partially fund the acquisitions of the eight properties.
“The proposed acquisitions are expected to be DPU-accretive. At the same time, the divestment of non-core assets will allow MLT to redeploy the capital into investments offering higher growth potential,” MLT’s manager says.
During FY2023, MLT completed three acquisitions in China, South Korea and Malaysia and incurred capital expenditure totalling $206 million. These investments were funded by diversified sources, including debt, issuance of 7-year $50 million medium-term notes and $22 million of divestment proceeds.
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Aggregate leverage fell to 36.8% as at March 31, versus 3QFY2023 of 37.4% owing to valuation increase of $224 million despite at $757.9 million loss in translation from the depreciation of various regional currencies. JP Morgan says “gearing should rise towards around 40% post-completion of recent acquisitions”. JP Morgan has an overweight recommendation on MLT.
Units in MLT closed 2 cents lower or 1.14% down at $1.74 on April 28.
