Mapletree Logistics Trust Review @ 26 October 2022

Basic Profile & Key Statistics

• Main Sector(s): Logistics
• Country(s) with Assets: Singapore, China, Hong Kong, Japan, Australia, South Korea, Malaysia, Vietnam & India
  
• No. of Properties (exclude development/associate/fund): 186

Key Indicators

Performance Highlight

Gross revenue, NPI and amount distributable have increased yoy mainly due to higher revenue from existing properties and contribution from properties acquired in 1Q FY22/23 and FY21/22. Despite an enlarged unitholder base, DPU improved yoy as well.

Rental Reversion

Rental reversion for the latest quarter is at 3.5%.

Acquisition

MLT completed the acquisition of 2 parcels of leasehold industrial properties in Malaysia on 14th July. These 2 land parcels, combined with existing properties - Subang 3 and 4 could potentially be used for redevelopment into a large logistics facility which could increase the plot ratio of Subang 3 and 4 by 5 times.

Development

The redevelopment of 51 Benoi Road is target to be completed by 1Q 2025. This redevelopment would increase the GFA by 2.3 times.

Sensitivity to Interest Rate

For every 0.25% increase in interest rate, DPU would be impacted by 0.01 cent per quarter, around 0.44%. 

Related Parties Shareholding

• REIT sponsor's shareholding: Above median for more than 20%
• REIT manager's shareholding: Above median for more than 10%
• Directors of REIT manager's shareholding: Below median for more than 20%

Lease Profile

• Occupancy: ± 5% from median
• Income in SGD/Major Currencies: Below median for more than 20%
• WALE: Below median for more than 10%
• Highest lease expiry within 5 years: ± 10% from median; Falls in FY23/24
• Weighted average land lease expiry: Below median for more than 20%

Debt Profile

• Gearing ratio: ± 10% from median
• Gearing including perps: ± 10% from median
• Cost of debt: ± 10% from median
• Fixed rate debt %: ± 10% from median
• Unsecured debt %: ± 10% from median
• WADM: Above median for more than 20%
• Highest debt maturity within 5 years: Below median for more than 20%; Falls in FY26/27
• Interest coverage ratio: ± 10% from median

Diversification Profile

• Top geographical contribution: Below median for more than 20%
• Top property contribution: Below  median for more than 20%
• Top 5 properties' contribution: Below median for more than 20%
• Top tenant contribution: Below median for more than 20%
• Top 10 tenants' contribution: Below median for more than 20%

Key Financial Metrics

• Property yield: ± 10% from median
• Management fees over distribution: Above median for more than 20%; $4.90 distribution for every dollar paid 
  
• Distribution on capital: ± 10% from median
• Distribution margin: Above median for more than 10%

Trends

• Uptrend: DPU, NAV per Unit
• Flat: Occupancy, Distribution Margin
• Slight Downtrend: Interest Coverage Ratio
• Downtrend: Property Yield, Distribution on Capital

Relative Valuation

• P/NAV: Below -1SD for 1y & 5y; Below -2SD for 3y
• Dividend Yield: Above +2SD for 1y & 3y; Above +1SD for 5y

Author's Opinion

Favorable	Less Favorable
High REIT Sponsor's Shareholding	Low Directors of REIT Manager's Shareholding
High REIT Manager's Shareholding	Low Income in SGD/Major Currencies
Long WADM	Short WALE
Well Spread Debt Maturity	Short Weighted Average Land Lease Expiry
Low Top Geographical Contribution	High Perpetual Securities %
Low Top Property & Top 5 Properties Contributions	Non Competitive Management Fees
Low Top Tenant & Top 10 Tenants Contributions	Property Yield Downtrend
High Distribution Margin	Distribution on Capital Downtrend
DPU Uptrend
NAV per Unit Uptrend

The performance declined marginally as compared to the previous quarter. Close to 3 quarters of MLT income is received in other currencies, which could affect the performance moving forward due to the strengthening of SGD. At this moment, 72% of distributable income for the coming 12 months is hedged into/derived in SGD.

You could also refer below for more information:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and Detail of Singapore REIT

REIT Analysis - List of previous REIT analysis posts

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*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions and loss or damage due to the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.