EC World Reit H1 DPU sinks 25.9% to S$0.02053

EC WORLD Real Estate Investment Trust’s (Reit) distribution per unit fell 25.9 per cent to 2.053 Singapore cents for the first half ended Jun 30, 2023, from 2.77 Singapore cents in the corresponding period last year. 

This follows a 12 per cent drop in gross revenue to S$55.7 million in H1, from S$63.3 million a year ago. Income available for distribution also contracted by 25.9 per cent to S$16.6 million, from S$22.4 million in the year-ago period. 

Net property income (NPI) experienced a 10.6 per cent year-on-year decrease to S$51.8 million, from S$57.9 million the previous year. 

The Reit’s manager attributed the lower revenue and NPI to the weakening of the Chinese yuan, a decline in late-fee income and other operating income, as well as the cessation of income contribution from Fu Zhuo Industrial. The Hangzhou port property was seized by Chinese authorities for public use last March. 

These declines were partially offset by organic rental escalations, added the manager. 

Meanwhile, finance costs rose 13.9 per cent year on year to S$22.8 million – primarily due to surging interest rates and an extension fee incurred during the period, said the manager. 

Earnings per share stood at 1.40 Singapore cents for the half-year, reversing from a loss per share of 2.86 Singapore cents in H1 FY2022. 

Despite the fall in revenue, the Reit’s portfolio occupancy remained “strong” at 96.3 per cent as at Jun 30. 

The weighted average lease to expiry by gross rental income and net lettable area stood at 1.2 years and 1 year, respectively. 

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The Reit’s manager highlighted that the business climate will remain challenging, with a weakening global economy, poor export demand and low consumer confidence.

“(EC World Reit) has to remain focused to resolve these issues while continuing to face financial stress arising from the current harsh currency and interest-rate conditions in the foreseeable future,” it said. 

Units of the trust closed at S$0.30 on Friday, up 1.7 per cent or S$0.005, ahead of the news.