Stoneweg European REIT's 1Q FY25 Result Review

Basic Profile & Key Statistics

Key Indicators

Performance Highlight

SERT delivered a stable set of results for 1Q 2025. Gross revenue remained largely flat year-on-year, while NPI rose 2.4%, helped by higher income from select properties and a reversal of bad debt provisions in France after two tenants settled their arrears. However, distributable income and indicative DPU fell year-on-year, primarily due to higher borrowing costs.

Rental Reversion

Portfolio rental reversion stood at +1.7% in the quarter. The logistics and light industrial segment saw a +4.9% uplift, while the office segment recorded a slight -0.6% reversion.

Asset Enhancement Initiative and Development

Two AEIs/developments are committed for Nove Mesto One Industrial Park 1 and Spennyoor, focusing on space expansion and solar panel installation. Additionally, De Ruijterkade 5 is in early planning stages. For Haagse Poort (Netherlands), a major €60 million upgrade has been confirmed and is expected to commence in 2026. Meanwhile, Maxima, Via Dell’Industria 18 and Kolumbusstraße 16 are under redevelopment.

Related Parties Shareholding

• REIT Sponsor's Shareholding: Moderate
• REIT Manager's Shareholding: Less Favorable
• Directors of REIT Manager's Shareholding: Favorable

Lease Profile

• Committed Occupancy: Moderate
• Income Received in SGD/Major Currencies: Less Favorable
• Highest Annual Lease Expiry in 4 Years: Favorable
• WALE: Favorable
• Weighted Average Land Lease Expiry: Favorable

Debt Profile

• Adjusted Interest Coverage Ratio: Moderate
• Cost of Debt: Moderate
• Gearing Ratio: Moderate
• Fixed Rate Debt Proportion: Favorable
• Unsecured Debt Proportion: Moderate
• Highest Annual Debt Maturity in 4 Years: Favorable
• WADM: Favorable

Diversification Profile

• Major Sector Weightage: Favorable
• Top Geographical Weightage: Favorable
• Top Property Weightage: Moderate
• Top 5 Properties' Weightage: Favorable
• Top Tenant Weightage: Moderate
• Top 10 Tenants' Weightage: Favorable

Key Financial Metrics

• Property Yield: Moderate
• Manager's Fees over Operating Distributable Income: Favorable
• Operating Distributable Income on Capital: Favorable
• Operating Distributable Income Margin: Moderate
• Operating Distribution Proportion: Favorable

DPU Breakdown

• TTM Distribution Breakdown:
• 100% from Operation

Trends (Up to 10 Years)

• Uptrend: Operating Distribution Proportion
• Slight Uptrend: Committed Occupancy
• Flat: None
• Slight Downtrend: Property Yield
• Downtrend: DPU from Operations, NAV per Unit, Adjusted Interest Coverage Ratio, Top 5 Properties' Weightage, Top 10 Tenants' Weightage, Operating Distributable Income over Manager's Fees, Operating Distributable Income on Capital, Operating Distributable Income Margin

Price Range & Relative Valuation Metrics

• Dividend Yield: Average for 1y, 3y, 5y & 10y
• P/NAV: Average for 1y, 3y, 5y & 10y

Author's Opinion

Compared to the previous quarter, operational performance has slightly improved, driven by a stronger NPI base. However, distribution to unitholders remained constrained due to elevated interest expenses. On the debt front, no refinancing is required until late 2026.

For more information, check out:

S-REITs Dashboard - Detailed information on individual Singapore REIT

S-REITs Data - Overview and detail of Singapore REITs

S-REIT Comparison - Comparison among Singapore REITs

REIT Review - List of previous REIT review posts

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*Disclaimer: The information presented on this blog is for educational and informational purposes only. The materials, including research and opinions, are based solely on my findings and should not be considered professional financial advice or a definitive statement of fact. I cannot guarantee the accuracy, completeness, or reliability of the information provided. I shall not be held liable for any errors, omissions, or losses that may occur as a result of using the information presented on this blog. It should be noted that the information presented on this blog does not constitute a buy, sell, or hold recommendation for any security. It is crucial to conduct your own thorough research and due diligence before making any investment decisions.