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Parkway Life Reit Q3 DPU falls 4.1% to 3.23 S cents

HEALTHCARE-FOCUSED real estate investment trust (Reit) Parkway Life Reit (PLife Reit) announced a distribution per unit of 3.23 Singapore cents for its third fiscal quarter, down 4.1 per cent from the year-ago period.

The Reit, one of Asia's largest listed healthcare Reits by asset size, attributed the dip to the absence of a one-off divestment gain a year ago, which was the  divestment of four Japan properties in December 2016. The divestment gains (after tax) of S$5.39 million was fully distributed to unitholders over four quarters in FY2017, the Reit said.

Excluding the one-off divestment gain, Q3 DPU from recurring operations grew 2.7 per cent year on year.

For the quarter under review, net property income rose 2.5 per cent to S$26.52 million from S$25.88 million for the same quarter last year.

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Gross revenue for Q3 similarly climbed 2.5 per cent to S$29.4 million, mainly due to the contribution from "one nursing rehabilitation facility" acquired in February 2018 - Konosu Nursing Home Kyoseien in Japan's Saitama prefecture - and higher rent from the Singapore properties as compared to the same period last year.

Parkway East Hospital's adjusted hospital revenue for its 11th year lease has also outperformed its minimum guaranteed rent, contributing to the increase in revenue from Singapore.

Yong Yean Chau, the Reit manager's chief executive said: "We remain committed in preserving the resiliency of our earnings within this environment of rising interest rates and market uncertainties. In the past quarter, we have successfully refinanced all loans due in 2019 as part of our liquidity risk management strategy and continued to manage our exposure to interest rate and foreign currency risks.

"This has been done to enhance the defensiveness of PLife Reit's balance sheet, to safeguard the stability and resiliency of our distributions to unitholders."

As at Sept 30, 2018, PLife Reit owns a portfolio of 50 properties with a total portfolio size of around S$1.75 billion, comprising of private hospitals in Singapore, including Mount Elizabeth Hospital, Gleneagles Hospital and Parkway East Hospital.

Its counter ended on Wednesday trading up 1.52 per cent to S$2.67.