The earnings season is on the trading door. Singapore REITs have always been one of the favorite investment choices for investors due to their stable earnings qualities.
Here Multi Management Future Solutions presenting the outlook of two REITs that have lived up to their investors’ expectation by delivering positive performances in their latest earnings updates.
The first REIT on the list is Ascott Residence Trust (SGX: A68U). Ascott Reit was established with the objective of investing primarily in real estate and real estate-related assets which are income-producing and which are used or predominantly used, as serviced residences, rental housing properties, and other hospitality assets. Ascott Reit’s asset size has grown to S$5.3 billion since it was listed on the Singapore Exchange Securities Trading Limited (SGX-ST) in March 2006. Its sponsor is Singapore undervalued stock and property giant, CapitaLand Limited.
As the Q3 ended on 30 September 2018, Ascott reported that revenue grew 6% YOY to S$134.5 million while gross profit improved by 9% to S$64.2 million. Its DPU was up 8% to 1.82 cents as compared to a year ago. Revenue improved as a result of accession, as well as stronger contribution from existing properties.
As of 30 September 2018, the REIT’s gearing stood at 36.4%, which is a safe distance from the regulatory ceiling of 45%.
The next REIT on the list is Mapletree Logistics Trust (SGX: M44U). Mapletree Logistics Trust is an Asia-focused logistics real estate investment trust. The Trust invests in a diversified portfolio of income-producing logistics real estate in Singapore, Japan, Hong Kong, South Korea, China, Australia, Malaysia, and Vietnam.
In the latest quarter ended 30 September 2018, MLT reported that gross revenue grew 13.8% YOY to S$106.6 million while net property income improved by 14.6% during the period to S$90.2 million. Also, DPU was up by 3.8% year-on-year to 1.958 cents. The growth in DPU was achieved despite an increase in units from 2.5 billion last year to 3.2 billion this year. The stronger performance was mainly driven by growth from the existing portfolio, as well as contributions from two acquisitions in Hong Kong.
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