Mapletree Pan Asia Commercial Trust's 1Q FY25/26 Result Review

Basic Profile & Key Statistics

Key Indicators

Performance Highlight

Gross revenue and NPI declined YoY, mainly due to the absence of contribution from Mapletree Anson, which was divested in July 2024, and weaker foreign currencies against SGD. Finance expenses declined as divestment proceeds were used to repay debt. As a result of lower income, the amount available for distribution and DPU declined YoY but this was partially cushioned by lower finance costs.

Rental Reversion

Portfolio rental reversion came in at 1.4%, supported by strong positive reversion from VivoCity. On the other hand, China, Hong Kong, and MBC Singapore recorded negative reversions.

Shopper Traffic & Tenant Sales

At VivoCity, tenant sales rose 2.1% year-on-year despite a slight decline in shopper traffic.

At Festival Walk, shopper traffic increased by 7.8%, while tenant sales declined by 3.2%.

Asset Enhancement Initiative

The Phase 1 Asset Enhancement Initiative (AEI) at VivoCity is completed. Phase 2 is in progress and on track to be completed by the end of 2025, with a progressive opening expected from September 2025.

Related Parties Shareholding

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

Lease Profile

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

Debt Profile

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

Diversification Profile

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

Key Financial Metrics

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

DPU Breakdown

• TTM Distribution Breakdown:
• 93.9% from Operation
• 4.3% from Management Fees Paid in Units
• 1.8% from Divestment Proceeds

Trends (Up to 10 Years)

• Uptrend: NAV per Unit
• Slight Uptrend: Operating Distributable Income over Manager's Fees
• Flat: DPU from Operations, Top 10 Tenants' Weightage, Operating Distribution Proportion
• Slight Downtrend: None
• Downtrend: Committed Occupancy, Adjusted Interest Coverage Ratio, Top 5 Properties' Weightage, Property Yield, 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; Below -1SD for 5y & 10y

Author's Opinion

Compared to the previous quarter, gross revenue and NPI have declined slightly. However, the amount available for distribution and DPU have improved, supported by lower finance expenses, reduced tax expenses, and a higher net effect from other non-tax deductible items and adjustments (Note A, no breakdown provided). On the debt front, only 6% of borrowings are maturing in the current fiscal year.

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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.