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Stocks In Focus SG (GLP, Sabana REIT, Hafary Hldgs) – 23/08/13
GLP Signs New Leasing Agreement
Global Logistic Properties (GLP) has pre-leased 24,000 square metres (sqm) to a leading global consumer goods company at GLP Park Jiangning, bringing the facility to 99 percent leased. This is the first direct cooperation between GLP and the customer, and will be the customer’s largest in China, where it will use the facilities to establish its national distribution center for finished products in China. Kent Yang, president of GLP China, was pleased to share that GLP has been able to gain the trust and confidence of the customer to lease directly. He added that the strategic location of GLP’s facilities will provide the customer with efficient connections to major consumption centers in China.
Significance: GLP’s strong occupancy in its logistics facilities and ability to attract new customers continue to be testimony to its track record and strength of its portfolio in the region.
Sabana REIT To Acquire Chai Chee Lane Property For $68.2m
Sabana Shari’ah Compliant Industrial Real Estate Investment Trust (Sabana REIT) has entered into a conditional put-and-call option agreement with Advanced Micro Devices (Singapore) in relation to the acquisition of the property located at 508 Chai Chee Lane for a total cost of approximately $68.2 million. The property is a seven-storey light industrial building with two basement storeys, with a built-up gross floor area of about 327,574.7 square feet. The acquisition is in line with Sabana REIT’s aim to invest in income-producing real estate and real-estate related assets used for industrial purposes in Asia, to generate stable and growing returns to its unitholders.
Significance: Sabana REIT will be able to benefit from an enlarged portfolio given that the property acquired has a balance land tenure of 46.5 years, which is longer than its existing portfolio of approximately 38.8 years. This could also potentially lead to better access to both debt and capital markets to support its future acquisition growth.
Hafary’s FY13 Earnings Surges 458.7%
Leading supplier of premium tiles, wood flooring and sanitary ware in Singapore, Hafary Holdings reported a strong set of results for the full year ended 30 June 2013. FY13 revenue increased 32.1 percent to $83.3 million driven by an across-the-board increase in sales contributed by its two business segments of general retail customers and projects involving property developments. Earnings for the period surged 458.7 percent to $25.4 million, underscored by the recognition of a one-time gain on disposal of the development property at 79 Aljunied Road amounting to $22.7 million. The company is proposing a final dividend of $0.025 per share, compared to FY12’s final dividend of $0.015 due to its disposal gains.
Significance: Hafary intends to continue building its overseas base progressively to capitalise on demand in markets with high-growth potential such as China and Vietnam while continuing to exercise financial prudence and maximise operational efficiency to improve its overall performance.
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