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Daiwa House Logistics Trust maintains 2HFY2023 DPU at 2.61 cents

The Edge Singapore
·2-min read

DHLT believes that the long-term fundamentals of the logistics sector in Japan will remain healthy

Daiwa House Logistics Trust has maintained its distribution per unit of 2.61 cents for 2HFY2023, bringing full-year payout to 5.22 cents, up 0.2% versus FY2022.

Net property income was $22.2 million for 2HFY2023, down 3.3% y-o-y; revenue was down 2.9% in the same period to $28.95 million.

For the full year, DHLT has reported a slightly higher distributable income of $36.4 million despite the weaker yen versus the Singdollar due to realised foreign exchange gain from income hedging.

With lease renewal, DHLT was able to maintain a relatively long weighted average lease expiry of 6.2 years.

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The value of the portfolio of 16 properties was up 1.8% y-o-y to 89.1 billion yen.

Aggregate leverage as at Dec 31 2023 was 35.2%, while interest coverage ratio remained relatively high at 11.9 times for FY2023.

According to DHLT's manager, the large supply of logistics space in Japan over the past year has moderated rental growth. Older facilities or those with poor accessibility face challenges securing tenants.

However, new supply may reduce going forward, due to rising land prices and increasing construction costs. This may tighten the demand-supply dynamics.

According to DHLT, despite the increased supply of logistics space, demand has remained healthy with 3PL and e-commerce companies looking to expand their businesses and establish new bases.

With the restriction on overtime for truck drivers coming into effect in April is seen to create new demand for logistics facilities in the regional areas.

As more Japanese companies relocate their manufacturing activities back from overseas, demand for logistics space will increase too.

As such, DHLT believes that the long-term fundamentals of the logistics sector in Japan will remain healthy.

"We are confident that the high quality of the portfolio will stand us in good stead," says Jun Yamamura, CEO of DHLT's manager.

DHLT units closed Feb 27 at 65 cents, up 0.78%

 

 

 

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