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Broker's Take: CDL Hospitality Trusts' Q3 DPU within expectations, says OCBC

OCBC Investment Research said on Tuesday that it will review its recommendation and the fair estimate of CDL Hospitality Trusts (CDLHT) following the latter's report of its results for the third quarter and nine months to the end of September.

Early Tuesday, CDLHT posted an income available for distribution per stapled security - after deducting income retained for working capital - of 2.61 Singapore cents in the third-quarter of 2014, down slightly from 2.64 Singapore cents in the same period last year.

Gross revenue was S$40.1 million for July to September, up 11.9 per cent from S$35.9 in the corresponding quarter last year, due to the recognition of the full revenue of Jumeirah Dhevanafushi hotel, acquired last Dec 31; the hotel contributed S$4.7 million in the third quarter of 2014.

Analyst Andy Wong said the revenue came in below his expectations but the DPU was in line.

"We expect a sequential improvement in Q414. Looking ahead, CDLHT believes the uncertain macroeconomic environment may continue to weigh on accommodation demand in its portfolio. We will provide more updates after speaking with management. Our 'Hold' rating and S$1.80 fair-value estimate is under review."

At 11:15am, the trust was trading around S$1.69, down half a cent in thin trade.