No distributable income for H1 2020, ARA H-Trust says
ARA US Hospitality Trust (ARA H-Trust) is expected to report a net property loss and no distributable income for the first six months of 2020, it said on Friday.
"The unprecedented decline in hotel occupancies and temporary hotel closures as a result of the impact of the Covid-19 pandemic since March 2020 has resulted in a significant decline in gross revenues," the trust managers said in a filing to the Singapore Exchange.
Although swift actions were taken to reduce operating cost by leveraging the select-service hotels' flexible cost structure, ARA H-Trust continued to incur fixed costs. A net property loss is expected based on preliminary estimates, the trust managers said.
That said, the trust was able to maintain positive gross operating profit in the first half.
The trust managers said they will monitor the situation: "ARA H-Trust continues to be in a secure financial position and has adequate liquidity to meet its operational needs and financial commitments to navigate through the crisis. The managers will continue to exercise caution and prudence in their capital and cash flow management."
ARA H-Trust will report its first half results on Aug 5, before the market opens.
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The units fell 0.5 US cent or 1.25 per cent to US$0.395 on Friday before the profit guidance was announced.
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