SINGAPORE (Aug 8): GLP, the provider of modern logistics facilities, reported a 29% fall in 1Q18 earnings ended June to US$144 million ($196 million) from US$203 million a year ago.

GLP says this was due to lower revaluations in the quarter. Earnings excluding revaluations were up 131% to US$89 million, due to foreign exchange movements.

In 1Q18, revenue rose 27% to US$262 million from $207 million a year ago, thanks to stable core earnings excluding revaluations of US$71 million from US$69 million a year ago. This was also underpinned by recurring income from operations and the continued expansion of its fund management platform.

Fund management fees ended at US$48 million for the quarter, up 15% year-on-year.

Group new and renewal leases increased 35% year-on-year to 36 million sf, with 72% of customers renewing their leases with GLP. Rent growth remained healthy, with the group recording 5.2% growth in same-property net operating income (NOI) and 7.7% rent growth on renewal leases.

In 1Q18, the group started US$226 million and completed US$252 million of development projects.

As of June 30, the group’s average lease ratio stood at 90%, 1% lower quarter-on-quarter.

Ming Z. Mei, CEO of GLP, says: “With retail and consumption patterns changing, both opportunities and challenges are ahead for the modern logistics business. We continue to position our business for long-term growth by creating a logistics ecosystem that can better serve our customers. It is business as usual for GLP. I continue to serve as CEO and our strong local teams remain focused on executing our strategy and further developing our global platform.”

Last month, GLP received an offer from Nesta Investment Holdings for the proposed privatisation of the group by way of a scheme of arrangement.

Nesta comprises SMG, owned by GLP’s Chief Executive Officer Ming Z. Mei, HOPU, Hillhouse Capital, Bank of China Group Investment and Vanke.

The proposed consideration of $3.38 per share will not be reduced by the FY17 dividend of 6 cents per share, which will be paid on Aug 22.

GIC, as the single largest shareholder of the company with a 36.84% stake, has provided an irrevocable undertaking to the offeror to vote in favour of the scheme.

The transaction is expected to be completed on or before April 14 2018.

Shares in GLP closed 1 cent lower at $3.25 on Monday.