Cromwell E-Reit H2 DPU drops 2.8% to 0.08459 euro

CROMWELL European Real Estate Investment Trust's (Cromwell E-Reit) CWBU distribution per unit (DPU) fell 2.8 per cent to 0.08459 euro for the 6 months ended Dec 31, 2021, from 0.08703 euro in the year-ago period, the manager said on Wednesday (Feb 23).

Net property income (NPI) grew 10.4 per cent on the year to 65.8 million euros (S$100.3 million) for the 6-month period, from 59.6 million euros. This was mainly due to higher revenue from new acquisitions in the Czech Republic, Slovakia, the UK, Italy and the Netherlands. There was also an absence of doubtful debt provisions in FY2021 compared with FY2020.

The rise in H2 2021 NPI was partially offset by disposals in France, the Netherlands and Denmark which took place in March 2020; lower income from pandemic-affected properties; lease expiries in Denmark and Finland; and foreseen rent reduction in 5 government-let properties in Italy.

Gross revenue, meanwhile, was up 8.3 per cent to 101.1 million euros for the half-year, from 93.3 million euros the year before.

Income available for distribution for H2 2021 rose 6.5 per cent year on year to 47.5 million euros, from 44.6 million euros, mainly due to new acquisitions.

The distribution will be paid out on Mar 31 after the record date on Mar 3. Existing unitholders will be able to acquire new units at a preferential price without incurring transaction costs as part of the Reit's distribution reinvestment plan (DRP). The DRP price will be at a 2 per cent discount to the 10-day volume-weighted average price ending on Mar 2, adjusted for the H2 2021 DPU.

Meanwhile, for the full-year ended Dec 31, 2021, DPU was 2.6 per cent lower at 0.16961 euro due to an absence of capital gains. Excluding a 2.8 million euro distribution of realised capital gains in FY2020, DPU for FY2021 was 0.5 per cent higher year on year.

FY2021 distributable income was up 5 per cent to 93.6 million euros. Gross revenue for the full year was 7 per cent higher at 200.1 million euros, while NPI gained 10.9 per cent to 130.1 million euros.

The manager bagged 223 new and renewed leases in FY2021, covering 217,529 square metres of space, or 12.2 per cent of the portfolio by net lettable area, with a positive rent reversion of 5 per cent on average, it said.

Cromwell E-Reit's top 10 tenant-customers contributed 30.9 per cent of total headline rent as Dec 31, 2021, compared with 33 per cent in the preceding year, as the manager looks to diversify the Reit's tenant mix.

The top tenant-customer of the Reit is the Italian State Property Office - which now contributes 11.7 per cent of total headline rent, compared with 20 per cent at listing.

The Reit's portfolio also registered a 2.4 per cent like-for-like increase in valuation in its light industrial/logistics sector. The fair value gains were largely in France, Germany, Denmark and the Netherlands.

Its portfolio occupancy stood at 95 per cent as at end-December 2021, while its weighted average lease expiry was 4.6 years by headline rent, compared with 4.9 years in the year-ago period.

Cromwell E-Reit's aggregate leverage stood at 36.6 per cent as at Dec 31, 2021. The manager said the Reit has no major debt expiring until November 2023.

Units of Cromwell E-Reit were trading 0.9 per cent or 0.02 euro higher at 2.36 euros as at 9.52 am on Wednesday.