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EC World REIT posts 6.8% fall in 3Q DPU to 1.388 cents on retention of distributable income

Felicia Tan
Felicia Tan • 2 min read
EC World REIT posts 6.8% fall in 3Q DPU to 1.388 cents on retention of distributable income
The quarter’s DPU translates to an annualised yield of 7.7%.
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The manager of EC World REIT has declared distribution per unit (DPU) of 1.388 cents for the 3QFY2020 ended Sept 30, down 6.8% from DPU of 1.489 cents a year ago.

The quarter’s DPU translates to an annualised yield of 7.7%.

Total amount available for distribution rose 3.5% y-o-y to $12.3 million due to contribution from Fuzhou E-Commerce, which was acquired in August 2019, as well as organic growth from rental escalations.

The REIT has, however, retained 9% (or $1.11 million) of the distributable amount due to the uncertain Covid-19 situation and global economic climate.

As such, total amount distributed to unitholders for the quarter fell 5.9% y-o-y to $11.2 million.

3QFY2020 gross revenue rose 10.8% y-o-y to $28.5 million, while net property income (NPI) was up by 14.0% y-o-y at $26.1 million.

In RMB terms, gross revenue and NPI rose 9.2% and 12.3% y-o-y respectively.

Read Also: EC World REIT secures and renews two major leases in China

On a like-for-like basis, after straight-line, security deposit accretion and other relevant distribution adjustments, the gross revenue and NPI in RMB terms increased 9.8% and 11.0% y-o-y respectively, mainly due to contribution from Fuzhou E-Commerce and organic rental escalations.

For the 9MFY2020, gross revenue was up 9.5% y-o-y at $80.2 million.

NPI rose 12.0% y-o-y to $73.1 million.

In RMB terms, gross revenue and NPI increased 9.4% and 12.0% y-o-y respectively.

Distribution to unitholders for the nine-month period fell 12.5% y-o-y to $31.6 million mainly due to the rental rebates given in 1QFY2020 and retention of distributable income.

As at Sept 30, EC World REIT has a portfolio occupancy of 96.7% with a weighted average lease expiry (WALE) of 2.6 years by net lettable area (NLA).

Cash and cash equivalents as at Sept 30 stood at $18.8 million.

“We have noted improvement in ECW’s portfolio with the renewal of a major lease in relation to Hengde Logistics and signing of new leases at Wuhan Meiluote at competitive rates. We continue to work hand-in-hand with the Property Manager to optimize portfolio performance,” says Goh Toh Sim, executive director and CEO of the manager.

In its outlook statement, the manager added that while the Covid-19 situation has stabilised in China, the Chinese government cautioned that a sustained recovery will still remain dependent on the global macro situation as well as continued epidemic control within the country.

Units in EC World REIT closed 1 cent higher or 1.4% up at 70.5 cents on Nov 9.

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