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Mapletree Industrial Trust reports 2QFY2023 DPU of 3.36 cents, down 3.2% y-o-y

Khairani Afifi Noordin
·2-min read

The REIT’s average overall portfolio occupancy for the quarter increased to 95.6% from 95.3% in the preceding quarter.

Mapletree Industrial Trust (MINT) has reported a distribution per unit (DPU) of 3.36 cents for its 2QFY2023 ended September, down 3.2% y-o-y.

Unitholders can expect to receive their quarterly DPU for the period on Dec 12.

Gross revenue and net property income for the quarter grew 12.8% and 8.3% y-o-y to $175.5 million and $130.3 million respectively.

The amount available for distribution to unitholders for 2QFY2023 increased by 0.7% y-o-y to $89 million, primarily driven by the contribution from the acquisition of 29 data centres in the US and partially offset by higher property operating expenses and borrowing costs.

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The REIT’s average overall portfolio occupancy for the quarter increased to 95.6% from 95.3% in the preceding quarter, attributed to the improvement in the Singapore portfolio.

The average occupancy rate for the Singapore portfolio for 2QFY2023 rose to 96.8% from 96.0% in the preceding quarter as higher occupancies were registered across most property segments.

The average occupancy rate for the North American Portfolio for 2QFY2023 decreased to 93.1% from 94.0% in the preceding quarter. The decline was due to the non-renewal of lease by its sole tenant at 2 Christie Heights, Leonia, which contributed about 0.4% to MINT’s portfolio gross revenue in FY2021/2022. The manager is in discussions with a prospect to take up the vacant space.

As at Sept 30, about 74.2% of MINT’s gross borrowings of $2.9 billion had been hedged through interest rate swaps and fixed rate borrowings, which will reduce the impact of interest rate fluctuations on distributions.

The REIT’s aggregate leverage ratio decreased quarter-on-quarter from 38.4% to 37.8% as at Sept 30 as a result of the redemption of the $45 million 3.65% 10-year medium term notes with cash, which matured on Sept 7. The weighted average all-in funding cost for 2QFY2023 was 2.9%, as compared to 2.5% for the previous quarter due to higher benchmark reference rates.

The manager had raised proceeds of $40.2 million from the distribution reinvestment plan (DPR) for 1QFY2023 Distribution, which represented a take-up rate of 42.9%. The DRP will continue to be applied for the 2QFY2023 distribution to finance progressive funding needs of the redevelopment project at 161, 163 & 165 Kallang Way.

As increasing property operating expenses and borrowing costs continue to exert pressure on distributions, the REIT manager will adopt cost-mitigating measures while focusing on tenant retention to maintain a stable portfolio occupancy.

Units in MINT closed 1 cent higher or 4.63% up on Oct 26 at $2.26.

 

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