Mapletree Industrial Trust posts higher Q1 DPU, distributable amount

MAINBOARD-LISTED Mapletree Industrial Trust (MIT) on Tuesday posted a 6.8 per cent year on year rise in distributable amount for the first quarter to S$51.5 million, lifted by higher rental income.

Distribution per unit (DPU) came in at 2.85 Singapore cents, up from 2.73 cents a year ago. It is payable on Aug 29.

Revenue for the three months as at end June 2016 was up 3 per cent to S$84.1 million, due mainly to higher rental rates achieved across all property segments, as well as higher occupancies achieved in Hi-Tech Buildings and Business Park Buildings.

Property operating expenses were S$20.3 million, down 5.3 per cent from the year-ago period, mainly due to lower property maintenance expenses, utilities and property taxes, partially offset by higher marketing commission.

Correspondingly, net property income grew 6 per cent to S$63.8 million.

Flatted factories remained the largest contributor to the group's revenue and net property income, while the contribution from the Hi-Tech Buildings rose in the quarter mainly due to higher rates secured for leases and improved occupancies.

Tham Kuo Wei, CEO of MIT's manager, said: "MIT delivered a healthy set of financial results despite facing headwinds in the Singapore industrial market. We continue to intensify our leasing efforts to retain our tenants. As at June 30, 2016, only 14.1 per cent of leases (by gross rental income) are due for renewal in FY2016/2017, a decrease from 21.1 per cent in the preceding quarter. The development of the build-to-suit (BTS) facility for HewlettPackard Singapore is progressing well with the revenue contribution expected to commence in the second half of FY2016/2017."

In its outlook, MIT's manager said: "The business environment is expected to remain subdued in view of the global uncertainties and large impending supply of industrial space in Singapore. This is likely to exert pressure on occupancy and rental rates. For leases expiring in FY2016/2017, the manager remains focused on tenant retention to keep the portfolio's occupancy healthy."