CapitaLand REIT income marginally lower in Q2
This is due to lower contributions from its three Klang Valley malls
PETALING JAYA: CapitaLand Malaysia Mall Trust (CMMT), a shopping mall-based real estate investment trust, recorded a net property income (NPI) of RM59.8mil for the second quarter ended June 30 (Q2’17), slightly down from RM60mil a year earlier.
CapitaLand Malaysia Mall REIT Management Sdn Bhd (CMRM) said in a statement that this was due to a lower contribution from all of its three Klang Valley shopping malls - The Mines, Sungei Wang Plaza and Tropicana City Property - which was offset by a stronger performance from Gurney Plaza and East Coast Mall.
The NPI for Sungei Wang Plaza fell by about a third to RM4.74mil, while Tropicana City Property posted a 1.6% lower NPI of RM7.23mil and The Mines recorded a 3.8% lower NPI of RM12.47mil.
In contrast, Gurney Plaza increased its NPI by 7.9% to RM25.45mil and East Coast Mall (Kuantan) improved its income by 8.7% to RM9.89mil.
CMMT, which registered a net fair value loss of RM11.8mil on investment properties in Q2’17 (Q2’16: a gain of RM2.6mil), saw its net profit drop by 34.2% to RM28.14mil on a 0.2% lower revenue of RM91.81mil.
On the lower revenue, CMRM told Bursa Malaysia that this was mainly due to negative rental reversions from Sungei Wang Plaza, as it continued to be temporarily affected by the ongoing Mass Rapid Transit works and the closure of BB Plaza.
The Mines was impacted by lower rental rates and occupancy, while Tropicana City Property’s lower gross revenue was mainly due to lower occupancy at the office tower.
CMRM said distributable income for Q2’17 was RM41.9mil and distribution per unit (DPU) was 2.06 sen.
It said the total DPU for the first half-year was 4.14 sen and the annualised DPU of 8.35 sen for the period translated to an annualised distribution yield of 5.4%, based on CMMT’s closing price of RM1.55 per unit on July 18.
CMRM chairman David Wong said in a statement: “Lifted by stronger domestic demand, the Malaysian economy expanded 5.6% in Q1’17, and is projected to grow 4.3% to 4.8% for the full year.
“However, retail sales in Q1’17 had yet to recover and had fallen by a further 1.2% year-on-year.
“In light of the prevailing cautious consumer sentiment and increasing competition brought on by new malls, the operating environment for the retail industry is expected to remain challenging (in the second half). Despite this, we remain positive that our portfolio of well-diversified necessity malls will continue to deliver sustainable income distribution for unitholders in the long term.”
CMRM chief executive officer Low Peck Chen said that amid a challenging operating environment, all its malls achieved a committed occupancy level of above 90%. “On the whole, our portfolio occupancy stood at a healthy 95.8% as at June 30, 2017,” she said.