Yahoo Finance CDLHT reports 35.0% higher NPI of $32.7 mil in 1QFY2023 update
CDLHT says it will continue to pursue suitable acquisitions with its short-term bridge loan facilities of $400.0 million.
CDL Hospitality Trusts (CDLHT) J85 has reported gross revenue of $60.8 million in the 1QFY2023 ended March 31, up 31.5% y-o-y.
Its net property income (NPI) increased by 35.0% y-o-y to $32.7 million.
The higher gross revenue and NPI came as the trust saw growth in its revenue per available room (RevPAR) across most of its portfolio driven by higher occupancies and better recovery.
CDLHT’s Singapore hotels reported an average daily rate (ADR) of $259 for the quarter, 49.2% higher y-o-y while RevPAR rose by 86.1% y-o-y to $176. Average occupancy rate rose by 13.5 percentage points y-o-y to 67.9%. The better performance was due to all the hotels being open to the public for the majority of the 1QFY2023 compared to the quarter in the year before. Business sentiment also improved from February onwards.
New Zealand’s Grand Millennium Auckland saw RevPAR decline by 5.9% y-o-y to NZ$164 ($134.62) as the hotel operated as a managed isolation facility with guaranteed occupancy and income in the corresponding quarter the year before. The hotel’s performance was also impacted by cancellations of major events and accommodation reservations from natural disasters such as the floods in the country’s North Island and Cyclone Gabrielle. The decline was also compounded by a weaker NZD against the SGD.
Australia’s Perth hotels saw RevPAR surge by 3.7 times or 273.3% higher y-o-y to A$122 ($108.02) as when borders into Western Australia were largely closed in the 1QFY2022. The higher RevPAR was also thanks to a strong event calendar and success in raising corporate rates this quarter.
In Japan, hotels RevPAR increased by 144.9% y-o-y to 7,553 Japanese yen ($75.23). According to CDLHT, the quarter’s ADR stood 5.2% higher than its pre-Covid-19 figures though it remained “marginally behind” the ADR from 1QFY2019 as Chinese tourists – one of Japan’s key source markets – have yet to fully return.
In the Maldives, RevPAR fell by 10.8% y-o-y to US$463 ($618.07) as the increase in resort supply and the reopening of alternative destinations offset the growth in visitor arrivals. Higher fuel prices and other cost inflation also impacted profit margins.
In the UK, RevPAR rose by 21.2% y-o-y to GBP104 ($173.50). The portfolio saw higher gross revenue in the quarter, which was partially offset by increased operating costs and cessation of the government’s Covid business rate relief since March 31, 2022.
In Germany, Pullman Hotel Munich reported a 145.7% y-o-y improvement in RevPAR to EUR59 ($86.89) with the recovery of corporate travel and events. The y-o-y growth did not translate to higher NPI for the German portfolio as only base rent on a straight-line basis was recognised and the first quarter is usually a seasonally weaker one.
At Hotel Cerretani Firenze in Italy, RevPAR rose by 97.1% y-o-y to EUR113. The figure is based on the total inventory, without factoring in the three-week closure in January for water pipe works. Excluding the closure dates, the hotel’s RevPAR would’ve been at EUR149. Its NPI grew by 37.1% y-o-y due to the recognition of base rent on a straight-line basis in 1QFY2022 (despite a weaker hotel performance for that period).
Claymore Connect, which is the only retail mall in CDLHT’s portfolio saw NPI improve by 104.5% y-o-y or $0.7 million due to higher occupancy of 91.0% as at March 31, up 5.2 percentage points y-o-y. The higher NPI was also attribute to the reduced rental rebates and an improvement in variable rent collected due to higher trading revenue from tenants.
Looking ahead, CDLHT expects to see continued growth in its portfolio markets as China reopens its borders although this may be offset by high interest rates and the weak global economic environment.
As at March 31, its gearing stood at 37.5% with an interest coverage ratio of 3.5x.
“With access to short-term uncommitted bridge loan facilities of $400.0 million, CDLHT will continue to pursue suitable acquisitions to augment and diversify its income streams, while working closely with its lessees and operators to execute strategic asset enhancement opportunities to ensure that the portfolio stays ahead of the competition,” says the trust.
As at 9.36am, units in CDLHT are trading 2 cents higher or 1.64% up at $1.24.
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