CDL Hospitality Trusts (CDLHT) reported on Thursday that its distribution per stapled security (DPSS) slipped to 3.01 Singapore cents for the fourth quarter ended Dec 31, 2015, down 3.8 per cent from 3.13 cents a year ago.
The stapled group - comprising CDL Hospitality Real Estate Investment Trust (H-Reit), a real estate investment trust, and CDL Hospitality Business Trust (HBT), a business trust - saw a 2.2 per cent slip in its Q4 net property income (NPI) to S$37.81 million from S$38.65 million.
Contributions from its Singapore properties and Maldives resorts declined by S$0.6 million and S$3.2 million, respectively. Australia and New Zealand hotels recorded lower fixed rents due to local currency weakness against the Singapore dollar.
However, inorganic NPI contributions of S$1.1 million from Japan Hotels and S$2.3 million from Hilton Cambridge City Centre in the UK have mitigated the weaker performance from Singapore and Maldives.
Total distribution (after retention for working capital) of S$29.8 million, which includes the annual variable rent of Angsana Velavaru and nine-month income and capital distribution from the Japan hotels, will be distributed to unitholders for the quarter. This represents a drop of S$0.9 million, or 3 per cent year-on-year. Hence, the lower DPSS.
For FY2015, CDLHT registered NPI of S$137 million, down 2.5 per cent from FY2014. As a result, DPSS for the full year stands at 10.06 Singapore cents, down 8.4 per cent from 10.98 cents in 2014.
The group said it revalued its investment properties on Dec 31,2015, and recorded a net fair value loss of S$30.2 million for Q4 2015 and FY2015. The fair value loss mainly arose from its Singapore, Australia and Maldives properties (offset by a fair value gain on its New Zealand property) but has no impact on the unitholders' distribution.
Revenue per available room (RevPAR) for the Singapore Hotels fell by 6.9 per cent year-on-year in FY 2015 to S$175, mainly due to the subdued corporate travel demand amid a slower global economic environment. Occupancy at M Hotel and Grand Copthorne Waterfront Hotel were also affected due to refurbishment works.
The entire renovation at Grand Copthorne is expected to be completed by the second half of 2016. At M Hotel, the 288-room refurbishment is scheduled for completion by April 2016, following which M Hotel will proceed with another room refurbishment for its 115 club rooms. This is expected to be completed in the second half of 2016.
Vincent Yeo, chief executive officer of CDLHT's managers, said the group continued to maintain a cautious outlook for its portfolio hotels this year as a result of the macro uncertainty.