Mapletree Logistics Trust’s income inches up 4.8% to $290.9m in FY16

Thanks to strong Hong Kong contributions.

Mapletree Logistics Trust (MLT) closed its financial year with soft results, as net property income (NPI) inched up 4.8% YoY to $290.9m. For the quarter, NPI edged up 3.3% YoY to $72.63m.

According to a MLT’s news release, MLT enjoyed contributions from acquisitions as well as strong results from Hong Kong, though partly offset by soft performance from Singapore. MLT’s profits were also hit by the flagging MYR.

A report by OCBC notes that DPU for the quarter dipped 2.7% YoY to 1.80 S cents, depite a 4.4% uptick in gross revenue to $88.4m. This is on back of a lower NPI margin of 81.7%, higher management fees and a spike in borrowing costs.

For FY16, revenue climbed 6% to $349.9m, while DPU slipped 1.6% YoY to 7.38 S cents.

OCBC further asserts that MLT bagged a positive rental reversion of 4% during FY16. However, rental reversions have moderated, coming in at 0.6% in Q4.

On the flip side, management actively pursued its forward renewals, thus lowering lease expiries in FY17 to 14.6% of NLA, in contrast to 21.1% at the start of FY16.

OCBC cautions that there are still some leasing risks around the corner for MLT, though, including six single-user assets due for renewal. Of these six, two are from Singapore and both tenants have already indicated their intention not to renew leases.

“The biggest risk comes from KPPC Co Ltd in Korea, one of MLT’s top ten customers, which contributed 2.7% of MLT’s gross revenue,” states OCBC.