CapitaLand Mall Trust’s 3Q DPU increased 1.3% to 3.10 cents after releasing some of its retained distributable income in 1H

The CapitaLand Mall Trust (CMT) manager reported a distribution per unit (DPU) of 3.10 cents for 3TFY2020 ending in September, 1.3% higher than the DPU of 3.06 cents a year ago. Distributable income for the quarter increased 1.2% year-over-year to $ 114.3 million, including the release of $ 36.4 million or approximately 78% of the $ 46.4 million of retained income in 1HFY2020. Gross Revenue for 3QFY2020 decreased 25.3% YoY to $ 150.3 million primarily due to rent waivers granted to eligible tenants amounting to about $ 29.5 million, as well as lower rent over billing gross and other income. Property operating expenses fell 19.4% YoY to $ 45.8 million primarily due to lower property taxes and property management fees due to lower gross income and net property income (NPI), property management rebates, as well as lower marketing, utility and maintenance expenses. To that end, the NPI decreased 27.6% year-over-year to $ 104.4 million. For the nine-month period ending in September, the DPU stood at 6.06 cents, down 31.6% year-on-year. Distributable profit for the period fell 31.5% year-on-year to $ 224.0 million. Gross revenue for the nine months fell 19.7% year-on-year to $ 468.7 million, primarily due to rental exemptions granted of about $ 106.0 million. The lower figures were slightly mitigated by the start of Funan in June 2019, which contributed some $ 40.3 million to the group. Property operating expenses so far this year fell 10.9% year-on-year due to lower property management fees. Consequently, the NPI for the nine-month period fell 23.2% year-on-year to $ 320.8 million. During the same period, CMT extended a rental relief package of about $ 183.4 million that includes rental exemptions, property tax refunds and cash grants. In addition, the trust waived the sales volume rent to qualifying tenants to “demonstrate their commitment” to a sustainable retail ecosystem. “We are encouraged by the steady recovery in the operational performance of the CMT shopping centers and the market in general since the reopening of Phase 2,” says Tony Tan, CEO of the manager. “As of September 30, 2020, almost all CMT tenants have resumed their operations and the occupancy of the portfolio remained stable at 98.0%. Portfolio buyer traffic and tenant sales per square foot per month during 3TFY2020 have recovered to approximately 60% and 89% from last year’s levels, respectively. Suburban shopping malls saw tenant sales rebound to around 97% from a year ago. We will continue to focus on operational recovery while remaining vigilant in complying with safe management measures, ”he adds. Looking ahead, Tan says the manager maintains a “cautious outlook” in the short term and that CMT will stay the course to “preserve the vitality of the retail ecosystem” while mitigating the negative impact in the “current challenging operating environment.”
See also: CapitaLand Commercial Trust Files Court Request to Sanction Trust Scheme; Moody’s downgrades CapitaLand Mall Trust to A3 Unitholders can expect to receive their DPU by 3QFY2020 on November 19. Units on CMT closed 1 cent lower or 0.5% lower at $ 1.91 on October 21.