EC World Reit's DPU for Q4 FY20 declines 5.5%

EC World Reit's (ECW) distribution per unit (DPU) for the fourth quarter ended Dec 31, 2020 fell 5.5 per cent to 1.427 Singapore cents, from 1.51 cents a year ago.

However, gross revenue rose 14.2 per cent year on year to S$29.53 million, while net property income (NPI) was up 11.1 per cent at S$27.2 million. Gross revenue and NPI were bolstered by the acquisition of e-commerce logistics asset Fuzhou E-commerce, organic rental escalations and the appreciation of the RMB against the Sing dollar, it said.

Meanwhile, distribution to unitholders was 5 per cent lower at S$11.5 million. The Reit retained 10 per cent of the total amount available for distribution, given the uncertainties arising from the global pandemic and for general working capital purposes.

The Reit's manager has decided not to receive its performance fee for Jan 1, 2020 to Dec 31, 2020.

For the 12 months ended Dec 31, 2020, DPU was 11.4 per cent lower year on year at 5.359 cents. Gross revenue rose 10.7 per cent to S$109.73 million, while NPI was 11.8 per cent higher at S$100.31 million. Distribution to unitholders was 10.6 per cent lower at S$43.11 million.

As at Dec 31, 2020, its portfolio occupancy stood at 99.3 per cent, with a weighted average lease to expiry (by gross rental income) of 3.4 years. About 15.8 per cent of gross rental income will be due for renewal in FY2021, of which 3.8 per cent of the gross rental income stems from a major lease with China Tobacco Zhejiang Industrial Co at Hengde Logistics, which expires in May. The Reit's manager has already commenced negotiations of the lease renewal with China Tobacco, it added.

As at Dec 31, 2020, ECW had an aggregate leverage of 38.1 per cent, with a blended running interest rate of 4.2 per cent for Q4 FY20 and a weighted average debt maturity of 1.6 years.

To mitigate currency risk, the Reit's manager hedged 100 per cent of the interest rate risk of ECW's offshore loans, using floating to fixed interest rate swaps and cross-currency swaps, it said.

The DPU will be paid on March 31, after the record date on March 15.

Units in ECW closed at 72 Singapore cents on Tuesday, half a cent or 0.69 per cent lower.