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CRCT's DPU up 0.8% for Q3 on existing mall growth, new malls' contributions

Photo 1_CapitaMall Xuefu.jpg
CapitaMall Xuefu, located in Harbin, Heilongjiang Province, is one of CRCT's three newly-acquired Chinese malls.

CAPITALAND Retail China Trust’s (CRCT) distribution per unit (DPU) edged up 0.8 per cent to 2.43 Singapore cents for the third quarter ended Sept 30, from 2.41 cents for the year-ago period, following improved growth from existing malls and contribution from three newly acquired malls.

Distributable income rose 13.9 per cent to S$26.9 million from S$23.6 million.

Net property income grew 11.9 per cent to S$41.1 million from S$36.7 million.

Tan Tze Wooi, CEO of CRCT's manager CapitaLand Retail China Trust Management Limited, said: "Amidst external pressures, China’s economy expanded by 6 per cent in Q3 2019. Retail sales and urban household disposable income per capita for the first nine months of 2019 continued to grow, at 8.2 per cent and 7.9 per cent year on year respectively, indicating resilient consumer confidence.

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"Pro stability policies and measures implemented by the government to encourage domestic consumption will bode well for CRCT's malls."

On the acquisition of the three new malls, Mr Tan said: "The acquisitions of CapitaMall Xuefu, CapitaMall Yuhuating and CapitaMall Aidemengdun – in our biggest transaction to date – have boosted CRCT’s portfolio size by 17.1 per cent and gross rentable area by 23.5 per cent.

"In addition to delivering quality and steady yields, the three malls offer scope for repositioning and asset enhancement in the coming years, serving as strong anchors to augment our next phase of growth. In connection with the transaction, we successfully raised S$279.4 million from the equity market in our largest fundraising exercise to date."

He added that with a larger market capitalisation and improved trading liquidity, the manager is in a stronger position to scale up CRCT's portfolio, with a focus on first and second tier cities where it has a strong operating and management track record.

The acquisition of the three malls comes after CRCT divested CapitaMall Wuhu and CapitaMall Saihan as part of the recycling of its assets.

The China-focused mall trust's units closed unchanged at S$1.53 on Thursday, before the release of its Q3 results on Friday morning.