CapitaMall Trust (CMT) turned in a sturdy set of 4Q12 results last Friday. DPU saw a 2.6% growth to 2.36 S cents, despite S$15.3m capital distribution received from CapitaRetail China Trust was retained for corporate and working capital purposes. This brings the FY12 DPU to 9.46 S cents (+1.0%), slightly ahead of our full-year DPU projection of 9.16 S cents. Over the year, a total of 446 leases were renewed at an average positive rental reversion of 6.0% (FY11: 6.4%). CMT also completed three major asset enhancement initiatives or AEIs in 2012 and saw strong committed occupancy rates ranging 95.3-99.6% post refurbishment. Looking ahead, CMT anticipates its completed AEI works to continue to boost its rental income in 2013. In addition, management will focus on its repositioning exercise for IMM Building and leasing activities for Westgate (both of which, we note, are currently on track). We maintain our BUY rating with a higher fair value of S$2.32 (S$2.30 previously) after we incorporate the results into our assumptions.
4Q12 results above view
CapitaMall Trust (CMT) turned in a sturdy set of 4Q12 results last Friday. NPI grew by 14.3% YoY to S$112.9m, driven by higher contributions from JCube and Bugis+, and higher rentals from its new and existing leases. DPU saw a 2.6% growth to 2.36 S cents, and was achieved despite the fact that S$15.3m capital distribution received from CapitaRetail China Trust was retained for corporate and working capital purposes. This brings the FY12 DPU to 9.46 S cents (+1.0%), slightly ahead of our full-year DPU projection of 9.16 S cents.
Steady operational performance
Over the year, a total of 446 leases were renewed at an average positive rental reversion of 6.0% (FY11: 6.4%). CMT also completed three major asset enhancement initiatives or AEIs (JCube, Bugis+ and The Atrium@Orchard) in 2012 and saw strong committed occupancy rates of between 95.3-99.6% post refurbishment. In early Jan, CMT fully concluded the AEI at Clarke Quay and leased out all the space. All these leasing efforts helped to keep the portfolio occupancy stable at 98.2% (3Q: 98.4%) and cushion the temporary decline in occupancy at IMM Building (currently undergoing repositioning) and Plaza Singapura (Carrefour’s exit).
Maintain BUY
Looking ahead, CMT anticipates its completed AEI works to continue to boost its rental income in 2013. In addition, management will focus on its repositioning exercise for IMM Building and leasing activities for Westgate (both of which, we note, are currently on track). While CMT has not announced any new investment this quarter, it expects to share at least one AEI in the next quarter. CMT’s gearing as at 31 Dec 2012 stood at 36.7%, representing an improvement of 0.9ppt QoQ due to the S$250m private placement in Nov and a S$69.0m asset revaluation gain, while average cost of debt was maintained at 3.3%. For 2013, we understand that CMT has also secured funds to fully refinance its debts due in the year. We maintain our BUYrating with a higher fair value of S$2.32 (S$2.30 previously) after we incorporate the results into our assumptions.
CapitaMall Trust (CMT) turned in a sturdy set of 4Q12 results last Friday. NPI grew by 14.3% YoY to S$112.9m, driven by higher contributions from JCube and Bugis+, and higher rentals from its new and existing leases. DPU saw a 2.6% growth to 2.36 S cents, and was achieved despite the fact that S$15.3m capital distribution received from CapitaRetail China Trust was retained for corporate and working capital purposes. This brings the FY12 DPU to 9.46 S cents (+1.0%), slightly ahead of our full-year DPU projection of 9.16 S cents.
Steady operational performance
Over the year, a total of 446 leases were renewed at an average positive rental reversion of 6.0% (FY11: 6.4%). CMT also completed three major asset enhancement initiatives or AEIs (JCube, Bugis+ and The Atrium@Orchard) in 2012 and saw strong committed occupancy rates of between 95.3-99.6% post refurbishment. In early Jan, CMT fully concluded the AEI at Clarke Quay and leased out all the space. All these leasing efforts helped to keep the portfolio occupancy stable at 98.2% (3Q: 98.4%) and cushion the temporary decline in occupancy at IMM Building (currently undergoing repositioning) and Plaza Singapura (Carrefour’s exit).
Maintain BUY
Looking ahead, CMT anticipates its completed AEI works to continue to boost its rental income in 2013. In addition, management will focus on its repositioning exercise for IMM Building and leasing activities for Westgate (both of which, we note, are currently on track). While CMT has not announced any new investment this quarter, it expects to share at least one AEI in the next quarter. CMT’s gearing as at 31 Dec 2012 stood at 36.7%, representing an improvement of 0.9ppt QoQ due to the S$250m private placement in Nov and a S$69.0m asset revaluation gain, while average cost of debt was maintained at 3.3%. For 2013, we understand that CMT has also secured funds to fully refinance its debts due in the year. We maintain our BUYrating with a higher fair value of S$2.32 (S$2.30 previously) after we incorporate the results into our assumptions.
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