CCT’s FY 2017 distributable income grew 7.4% year-on-year
Higher quality portfolio & diversified tenant mix augur well for long term growth
Singapore, 25 January 2018 – CapitaLand Commercial Trust Management Limited, the Manager of CapitaLand Commercial Trust (CCT or Trust), is pleased to report higher distributable income of S$75.0 million in 4Q 2017 compared to S$70.8 million in 4Q 2016, which translates to a year-on-year (y-
FY 2017 gross revenue increased by 13.0% y-
The Trust’s investment properties, including its joint venture interests in Raffles City Singapore, One George Street and Golden Shoe Car Park redevelopment have been assessed by independent valuers. With the acquisition of Asia Square Tower 2, the portfolio investment value was S$10.4 billion as at 31 December 2017, representing a 25.4% y-
The Trust’s unaudited Consolidated Financial Statements for FY 2017 results are available on its website (www.cct.com.sg) and on SGXNet (www.sgx.com).
SUMMARY OF CCT GROUP RESULTS
|
4Q 2017 |
4Q 2016 |
Change (%) |
FY 2017 |
FY 2016 |
Change (%) |
Gross Revenue (S$’000) |
86,2922 |
89,726 |
(3.8) |
337,457 |
298,577 |
13.0 |
Net Property Income (S$’000) |
67,955 |
70,770 |
(4.0) |
265,468 |
231,277 |
14.8 |
Distributable Income (S$’000) |
75,0313 |
70,808 |
6.0 |
288,8993 |
269,037 |
7.4 |
DPU (cents) |
2.084 |
2.39 |
(13.0) |
8.664 |
9.08 |
(4.6) |
Adjusted DPU (cents)5 |
2.08 |
1.961 |
6.1 |
8.66 |
8.251 |
5.0 |
Mr Soo Kok Leng, Chairman of the Manager, said, “CCT has once again delivered higher distributable income despite a challenging Singapore office market in 2017. The Trust successfully reconstituted its portfolio by unlocking asset value with the divestments of Wilkie Edge and a 50.0% interest in One George Street; astutely redeploying the capital to the acquisition of Asia Square Tower 2, a higher yielding asset, as well as the redevelopment of Golden Shoe Car Park. This positions CCT well for
Mr Kevin Chee, Chief Executive Officer of the Manager, said, “2017 has been an exciting year of growth for CCT. We are pleased to have delivered a robust set of
The Trust has a healthy balance sheet with an aggregate leverage of 37.3%5, well below the regulatory limit of 45.0%. Its average cost of debt remains stable at 2.6% as at 31 December 2017. About 80% of the Trust’s borrowings are pegged at fixed rates, which offer greater certainty of interest expense in a rising interest rate environment. The Manager continues to adopt a proactive capital management strategy to optimise the average term to maturity and cost of borrowings. For the S$1.12 billion bridge facility obtained for the acquisition of Asia Square Tower 2 due in 2019, CCT has obtained S$600 million in unsecured bank loans to refinance it ahead of its maturity. The Trust awaits the right opportunity and timing to refinance the remaining S$520.0 million.
In FY 2017, CCT signed approximately 666,000 sq ft of leases, of which 38% were new leases. Leasing demand came largely from the Banking, Insurance and Financial Services, Business Consultancy, IT, Media and Telecommunications, and Energy, Commodities, Maritime and Logistics sectors. New and renewed tenants in 4Q 2017 include Cathay Petroleum International Pte Ltd,
Outlook
Based on data from CBRE Pte. Ltd., Singapore’s Core CBD and Grade A occupancy rates are at 93.8% with Grade A occupancy rate tracking an uptick of 2.2%, up from 91.6% in 3Q 2017. Average monthly market rent for Grade A offices rose to S$9.40
14Q 2016 and 2H 2016 DPU were adjusted for the enlarged 3,608.1 million units arising from new units issued for equity raised, conversion of convertible bonds and issuance of units for management fees in FY 2017.
2Lower revenue due to divestments of One George Street (50.0% interest) in June 2017, Golden Shoe Car Park in July 2017 and Wilkie Edge in September 2017 but mitigated by higher gross revenue from CapitaGreen and contribution from newly acquired Asia Square Tower 2 effective 1 November 2017. Lower revenue led to lower net property income.
3Includes top-up of S$1.1 million in 4Q 2017 and S$4.4 million in FY 2017 for the loss of distributable income arising from the divestments of One George Street (50.0% interest) and Wilkie Edge. Also includes tax-exempt distribution of S$8.0 million.
44Q 2017 DPU of 2.08 cents was computed based on 3,608 million of CCT units issued
5The aggregate leverage of 37.3% takes into account CCT’s proportionate share of its joint venture borrowings and deposited property value.