Far East Hospitality Trust reports 6% higher NPI of $25.1 mil in 1QFY2024

Gross revenue for the quarter increased by 7.5% y-o-y to $27.1 million.

The managers of Far East Hospitality Trust Q5t (FEHT) have reported a gross revenue of $27.1 million for the 1QFY2024 ended March 31, 7.5% higher y-o-y.

During the quarter, the trust’s hotels and commercial premises segments grew, with hotels revenue up by 8.4% y-o-y to $20.0 million and commercial premises revenue up by 10% y-o-y at $4.4 million. This was offset by a dip in serviced residences (SR) revenue, which fell by 2.0% y-o-y to $2.7 million.

Net property income (NPI) grew by 6.0% y-o-y to $25.1 million.

In the 1QFY2024, the average occupancy for the hotels segment fell by 1.5 percentage points (ppts) to 80.4% as some of the portfolio’s hotels continued to ramp up after exiting the government contracts in March, October and December 2023. According to FEHT, properties that exited the government contracts had greater flexibility in getting higher average daily rates (ADRs).

As such, the quarter’s ADR was up by 8.8% y-o-y at $179. Revenue per available room (RevPAR) rose by 6.7% y-o-y to $144.

Average occupancy for SRs fell by 3.7 ppts to 83.3% as several long-stay contracts expired during the earlier part of the quarter. According to FEHT, the SR segment has secured new contracts that have boosted its occupancy at a level comparable to that of the previous year.

ADR rose by 2.9% y-o-y to $265 while revenue per available unit (RevPAU) fell by 1.5% y-o-y to $221.

As at March 31, FEHT’s net asset value (NAV) stood at 91.5 cents, 1.5% lower than the NAV of 92.9 cents as at Dec 31, 2023. Gearing stood at 31.5% with an interest coverage ratio (ICR) of 3.5 times. According to FEHT, the trust will see a distribution decline of $2.1 million should interest rates on variable rate debt rise by 50 basis points (bps).

Units in FEHT closed 0.5 cents higher or 0.82% up at 61.5 cents on April 29.

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