THE manager of Sasseur Real Estate Investment Trust (Reit) on Thursday (Feb 20) posted a distribution per unit (DPU) of S$0.02929 for the second half ended December, up 0.1 per cent from S$0.02927 in the previous corresponding period.
This was supported by resilient rental income under the Reit’s entrusted management agreement (EMA) model. EMA rental income for the second half rose 0.8 per cent on the year to 335.1 million yuan (S$62.8 million) from 332.5 million yuan.
This brought distributable income up 3.1 per cent to S$40.6 million from S$39.4 million previously. The rise in distributable income was attributed to lower finance cost and tax expenses.
The distribution will be paid on Mar 27, after the record date on Mar 18.
For the full year, DPU was 2.7 per cent lower year on year at S$0.06082 from S$0.06249. This was mainly attributed to a lower DPU recorded for the first half, as well as higher retention to support onshore loan principal amortisation and future capital expenditures.
Distributable income fell 0.1 per cent to S$83.3 million from S$83.4 million.
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EMA rental income for the full year rose 0.9 per cent to 664.1 million yuan from 658.5 million yuan. This was driven by a 3 per cent rise in the fixed component, which offset a 3.7 per cent decline in the variable component, in line with a 3.9 per cent drop in the portfolio’s outlet sales.
In Singapore dollars, however, EMA rental income for the full year fell 0.4 per cent to S$124.5 million from S$124.9 million, primarily due to currency translation effects.
Cecilia Tan, chief executive of the manager, highlighted the steady recovery in the Reit’s outlet sales, which rose 4.8 per cent year on year in Q4, reversing the downward trend in the first three quarters. This was attributed to “strong performance during (China’s) Golden Week and year-end promotional campaigns”.
Outlet sales for the full year, however, declined 3.9 per cent due to unforeseen natural hazards, including severe heatwaves in Chongqing and earthquakes in Hefei which impacted shopper traffic. There was also a fall in consumers’ overall purchasing power.
Throughout the year, Sasseur Reit undertook four major asset enhancement initiatives. As a result, its portfolio occupancy reached an all-time high of 98.9 per cent in Q4 – an increase of 1.3 percentage points on the year.
Valuation of the four China outlets owned by the Reit stood at about 8.4 billion yuan as at end-December, a slight decline of 0.9 per cent on the year.
As at end-December, Sasseur Reit’s aggregate leverage stood at 24.8 per cent, and its interest coverage ratio strengthened to 4.6 times. About 87 per cent of its total borrowings are hedged to fixed rates or pegged to stable interest rates, with a weighted average debt to maturity of 2.5 years.
Tan noted that preliminary sales data from this year’s Chinese New Year period indicated “strong buying momentum, with a double-digit sales growth across the portfolio’s outlets in January 2025”.
“Given these positive indicators, we remain cautiously optimistic about the sales outlook for our portfolio’s outlets in 2025,” she added.
Units of Sasseur Reit closed 0.7 per cent or S$0.005 lower at S$0.69 on Wednesday.
