Dasin Retail Trust 9M revenue falls 7.8% on China Covid-19 curbs, higher rental rebates

CHINA-FOCUSED real estate investment trust Dasin Retail Trust on Monday (Nov 14) reported a 7.8 per cent drop in revenue to S$70.7 million for the nine months ended September (9M2022), from S$76.7 million the year before.

Net property income for 9M2022 slipped 8.3 per cent to S$55.2 million, from S$60.3 million in the corresponding period last year.

The trustee-manager said the declines were due to the temporary closure of some malls and trade sectors by the government due to Covid-19-related restrictions.

Rental rebates to tenants in 9M2022 were about three times higher than the previous year, the trustee-manager said.

It added that strict travel restrictions and social distancing measures also caused “stifling spending in China’s consumer market and weak consumer sentiments”, resulting in lower revenue contribution from all its properties.

“We believe that the performance of the malls will improve with the easing of movement restrictions but it would be challenging as it may still take some time for the consumer sentiment to reach full recovery,” said Wang Qiu, CEO of the trustee-manager of Dasin Retail Trust.

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The trustee-manager said it has been working closely with its lenders for the refinancing exercise and exploring potential proposals, including the disposal of certain assets, partnership with strategic investors, and alternative fundraising activities.

It added that it has commenced discussions with more than one leading Chinese enterprise for potential strategic investments.

Dasin Retail Trust has some S$756.4 million of facilities due by the end of this year.

Its gearing ratio stood at 40.4 per cent as at end-September.

“While placing our great priority working towards the completion of the refinancing exercises, we continue with our efforts in optimising tenant mix and introducing trending brands to enhance customers’ shopping experience,” Wang said.

Units of Dasin Retail Trust closed flat at S$0.27 on Monday, before the announcement.