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Stocks to watch: SingPost, ARA Asset Management, Lippo Malls Indonesia Retail Trust
SingPost, ARA Asset Management, Lippo Malls Indonesia Retail Trust released material announcements after the market closed on Tuesday.
SINGAPORE Post (SingPost) director Keith Tay has resigned as lead independent director and will leave the board earlier than previously announced. This comes after a corporate governance special audit report singled out Mr Tay for disclosure lapses, but found that his failures were not intentional. Findings from the joint investigation by PricewaterhouseCoopers (PwC) and Drew & Napier painted a picture of a board with weak controls, no standard processes for evaluating acquisitions and potential inaccuracies in its records. The report was commissioned last December after the group admitted that it had made an oversight in a July 2014 deal disclosure when it inaccurately said that no directors had an interest in its acquisition of freight forwarder FS Mackenzie; Mr Tay actually held 34.5 per cent of Stirling Coleman, which had advised FS Mackenzie's seller. However, the special auditors said that SingPost's erroneous disclosure "appears to have been a result of carelessness in its preparation by certain SingPost staff" and that there was no deliberate intention to hide Mr Tay's interest as it was Mr Tay who later drew SingPost's attention to the error. SingPost went on to seek external legal advice on the incorrect announcement once the error was discovered but decided not to issue any correction at the time based on that advice. Mr Tay has asked to step down before end May. BT reported, citing sources, that Singtel chairman Simon Israel could be a potential candidate for the SingPost chairmanship.
ARA Asset Management on Tuesday posted a 2 per cent increase in its net profit to S$19.4 million, on the back of a 10 per cent rise in total revenue to S$41.4 million for its first quarter ended March 31, 2016.
The improved performance was largely underpinned by a 14 per cent increase in recurrent management fees to S$34.3 million. The higher real estate investment trust (Reit) management fees arose from better asset performance after renovations, which also raised the valuation of the property portfolios of the Reits that it manages.
In Q1, ARA also saw fee contribution from Suntec Reit's acquisition of three floors of strata office space at Suntec Tower Two, and Cache Logistic Trust's acquisition of three Australian properties in the last quarter of 2015.
LIPPO Malls Indonesia Retail Trust (LMIR Trust) reported a 5.1 per cent increase year on year in distribution per unit (DPU) in the first quarter to 0.83 Singapore cent, up from 0.79 Singapore cent.
Distributable income rose 7.8 per cent to S$23.18 million while net property income edged up 4.6 per cent to S$40.83 million.
Gross revenue increased 8.5 per cent to S$45.52 million, aided by the acquisition of two retail malls last year: Lippo Plaza Batu (LPB) and Palembang Icon (PICON). The trust also registered higher rental reversion within the existing malls, as well as higher rental income from rental of electrical, mechanical and mall operating equipment and the additional contribution from carpark income from the two malls.