CRT's Q2 DPU up 5.2% from year-ago restated DPU thanks to acquisitions

CROESUS Retail Trust (CRT) enjoyed a 5.2 per cent rise in distribution per unit (DPU) for the second quarter ended Dec 31, 2016, to 1.81 Singapore cents, from a restated DPU of 1.72 cents in the year-ago period that reflects an enlarged unit base arising from a preferential offering in August.

This came on the back of an enlarged portfolio due to acquisitions.

During the quarter, gross revenue jumped 30.7 per cent to 3.18 billion yen (S$39.8 million), due to a larger portfolio of income-producing properties, following the acquisitions of Torius, Fuji Grand Natalie, Mallage Saga and Feeeal Asahikawa.

In addition, higher variable rent which arose from stronger tenant sales at Mallage Shobu, as well as a one-off compensation from an early lease termination, also buoyed CRT's gross revenue.

CRT restated its DPU for the year-ago comparison to take into account a preferential offering of 27.68 million units in August 2016. Otherwise, the DPU's year-on-year rise would have been 1.1 per cent.

CRT's net property income for the quarter rose 23.2 per cent from a year ago to 1.69 billion yen.

Similarly, CRT's half-year DPU of 3.6 Singapore cents was 7.5 per cent higher than the restated year-ago DPU of 3.35 Singapore cents. If the preferential offering is not factored into the year-ago comparison, first-half DPU would be 2.9 per cent higher than the DPU of 3.50 Singapore cents in the year-ago period.

Jim Chang, CEO of the trustee-manager, noted that CRT's financial performance for the first half reflects its ongoing efforts in areas such as enhancement initiatives and tenant renewal exercises.

Asset enhancement initiatives and tenant renewal exercises are currently being evaluated by the trustee-manager, as part of plans to grow CRT's income base.

At Torius, the trustee-manager is in the process of negotiating with potential tenants for its new building plans; a tenant replacement exercise is also underway at Feeeal Asahikawa, which is located in Asahikawa, the second-largest city in Hokkaido.

CRT's distribution for the period of July 1 to Dec 31 will be paid out on March 31 this year.