CMMT 1Q 2016 net property income grows 13.1% year-on-year
Underpinned by new income contribution from Tropicana City Mall and higher contributions from Gurney Plaza and East Coast Mall
Kuala Lumpur, 14 April 2016 – CapitaLand Malaysia Mall REIT Management Sdn. Bhd.1 (CMRM), the manager of CapitaLand Malaysia Mall Trust (CMMT), is pleased to announce that CMMT achieved net property income (NPI) of RM60.6 million for the period from 1 January to 31 March 2016 (1Q 2016), 13.1% higher than the NPI of RM53.6 million for the corresponding period the year before (1Q 2015). This increase was mainly due to new contribution from Tropicana City Mall and Tropicana City Office Tower that was acquired on 10 July 2015, as well as higher contributions from Gurney Plaza and East Coast Mall.
Distributable income for 1Q 2016 was RM42.9 million, an increase of 7.2% over the RM40.0 million for 1Q 2015. The annualised distribution per unit (DPU) of 8.53 sen2 translates to an annualised distribution yield of 5.9% based on CMMT’s closing price of RM1.45 per unit on 13 April 2016. As CMMT’s DPU is paid out on a half yearly basis, unitholders can expect to receive their DPU for 1Q 2016, along with their DPU for the quarter ending 30 June 2016, by August 2016.
Mr David Wong, Chairman of CMRM, said: “Despite the challenging global economic environment, the Malaysian economy is forecast to grow 4.0% to 4.5%3 this year. We expect consumer and business sentiments to remain cautious throughout the year as concerns over rising costs of living persist. The operating environment is also likely to face headwinds arising from intensifying competition as more retail space is scheduled for completion this year. However, we remain confident that CMMT’s portfolio of quality malls, which are strategically located and largely focused on day-to-day necessity shopping, will continue to be resilient through the different economic cycles.”
Ms Low Peck Chen, CEO of CMRM, said: “For the quarter under review, Tropicana City Mall and Tropicana City Office Tower accounted for 12.7% of our NPI. Gurney Plaza and East Coast Mall also contributed significantly to the increase in our NPI, with higher rental rates achieved from new and renewed leases. Despite the temporary impact of the nearby Mass Rapid Transit construction works on Sungei Wang Plaza’s shopper traffic, we are confident that the stable performance of the other malls in our income and geographically diversified portfolio will help to cushion the effect and continue to provide stable returns for unitholders.”
“We are committed to improving the shopping experience in our malls and ensuring we remain relevant and attractive to shoppers. At Tropicana City Mall, we embarked on asset enhancement works, which include the creation of a new retail area on the ground floor adjacent to the office tower. As part of our ongoing efforts to further strengthen Gurney Plaza as Penang’s premier lifestyle shopping mall, we also plan to carry out reconfiguration works to create new retail areas on Basement 1 and Level 7 later this year.”
“We will continue to focus on optimising our retail mix, introducing new-to-market brands and concepts that appeal to shoppers, as well as sourcing for acquisition opportunities to add to our existing portfolio.”
Summary of CMMT’s results
1 Formerly known as CapitaMalls Malaysia REIT Management Sdn. Bhd.
2 2016 annualised DPU is based on 366 days.
3 Source: Bank Negara Malaysia Annual Report 2015.
4 Based on closing price of RM1.45 per unit on 13 April 2016.
5 Based on closing price of RM1.53 per unit on 14 April 2015.