Closing Price S$0.220
• 1QFY12 revenue of $21.0 million, net property income of $14.3 million, distributable income of $12.1 million
• 1QFY12 DPU 0.53 cent
• Unlocked the redevelopment potential of 20 Gul Way
• We ceased coverage in the trust due to reallocation of resources.
Acquisition growths enhanced the top- and bottom-lines
AIMS AMP Capital Industrial REIT (AAC) posted 1QFY12 revenue of $21.0 million (+30.8% yy, +0.9% q-q), net property income of $14.3 million (+22.1% y-y, -0.4% q-q) and distributable income of $12.1 million (+49.4% y-y, +7.0% q-q). The revenue improvement was mainly due to the positive net effects of acquisitions (North Tech and 27 Penjuru Lane) and divestments (23 Changi South Avenue 2 and Asahi Ohmiya Warehouse) between 4Q 2010 and 1Q 2011 of the calendar year. Portfolio occupancy rate has stabilized and crept up modestly by 0.1%-pt to 99.1%. DPU for the quarter was 0.53 cent (-1.4s% y-y, -1.9% q-q), down marginally from 0.54 cent compared to the preceding quarter. A small portion of available distributable income (3.2%) was retained by the management in the quarter and translated to a lower DPU on a q-q basis.
Realized the redevelopment potential of 20 Gul Way
The existing property at 20 Gul Way, which comprises 10 single storey buildings, will be redeveloped into a five story ramp-up warehouse. The plot ratio will be maximized to 1.4 and increased the GFA to approximately 1.2 million sq ft after completion. The current master lessee (Enviro-Metals) will surrender the lease in phases while new master lessee (CWT Limited) will sign 4 and 5 years lease on both phases of the warehouse. The project redevelopment cost will be financed by debt and internal resources. With the debt funding, aggregate gearing will rise to 41.5%. NPI yield based on valuation is expected to be 7.4%.
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