CapitaLand Commercial Trust Q1 DPU down 25% to 1.65¢

Singapore

CAPITALAND Commercial Trust (CCT) posted a 25 per cent fall in distribution per unit (DPU) to 1.65 Singapore cents for the first quarter ended March 31, due to its retention of taxable distributable income and its decision to withhold distribution of tax-exempt income "as a matter of prudence" amid the Covid-19 outbreak.

Its gross revenue for the quarter inched up 3.8 per cent to S$103.6 million, driven by Main Airport Center, a freehold multi-tenanted office building near the Frankfurt International Airport, which was acquired in September 2019.

Higher revenue was also credited to 21 Collyer Quay, CapitaGreen and the Frankfurt property called Gallileo. This was partly dampened by lower income from Asia Square Tower 2, Six Battery Road and Bugis Village.

CCT's net property income rose marginally by 0.7 per cent to S$80.3 million, as the increase in revenue was partially offset by higher operating expenses. As of end-March, CCT's total deposited property value was S$11.7 billion, while its adjusted net asset value per unit (excluding distributable income payable to unitholders) was S$1.83.

The CCT portfolio's committed occupancy as at end-March was 95.2 per cent, down from 98 per cent in the last quarter. This was due to lower occupancy at Six Battery Road, with upgrading works following the lease expiry of an anchor tenant.

CCT's aggregate leverage as at end-March inched up to 35.5 per cent, up from 35.1 per cent as of end-2019, due to higher borrowings. It has an interest coverage ratio of 5.7 times.

Even amid Covid-19, CCT has renewed a significant proportion of expiring leases or is in advanced negotiations for most major leases due in 2020 "through proactive asset and lease management", said Kevin Chee, chief executive of the trust's manager.

Units of CCT closed at S$1.57 on Wednesday before the results release, up S$0.07 or 4.67 per cent.