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Keppel-KBS US REIT posts 4Q DPU of 1.25 US cents, 16.7% lower than forecast on enlarged base

Samantha Chiew
Samantha Chiew • 2 min read
Keppel-KBS US REIT posts 4Q DPU of 1.25 US cents, 16.7% lower than forecast on enlarged base
SINGAPORE (Jan 24): The manager of Keppel-KBS US REIT, which listed on Nov 9, 2017, announced that its 4Q18 DPU came in at 1.25 US cents, 16.7% lower than the 1.50 US cents forecast.
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SINGAPORE (Jan 24): The manager of Keppel-KBS US REIT, which listed on Nov 9, 2017, announced that its 4Q18 DPU came in at 1.25 US cents, 16.7% lower than the 1.50 US cents forecast.

This brings DPU from Nov 9, 2017 to Dec 31, 2018, to 6.22 US cents, 8.4% lower than 6.79 US cents forecast.

Income available for distribution to unitholders for 4Q18 was 8.6% higher than forecast at US$10.3 million ($14 million).

DPU was lower despite higher income available for distribution to unitholders, due to an enlarged unit base as a result of a rights issue to raise gross proceeds of about US$93.1 million to partially fund the acquisition of the Westpark Portfolio.

On a like-for-like basis, DPU, excluding effects of the acquisition of the Westpark Portfolio and rights issue, would have been 1.51 US cents for 4Q18 and 6.83 US cents for the period from listing date to Dec 31, 2018, above forecast by 0.7% and 0.6% respectively.

Gross revenue for the quarter came in at US$24.5 million, 5.9% higher than US$23.1 million forecast, bringing net property income to US$14.6 million, 7.7% higher than forecast.

This was largely due to the US$1.4 million of gross revenue contributed from Westpark which was not factored in the forecast. Excluding the contribution of The Westpark Portfolio, gross revenue came in line with forecast.

The acquisition of the Westpark Portfolio was completed on Nov 30, 2018.

As at end Dec, the REIT’s cash and cash equivalents stood at US$40.6 million.

Looking ahead, the manager says that it is committed to delivering stable distributions and creating long term value for unitholders through driving strong operational performance, as well as with the additional income contribution from Maitland Promenade I in Orlando, which was completed on Jan 16.

With office rents rising in the submarkets where the trust operates, it with its well-spread lease expiry profile, will benefit when expiring leases with lower rents are marked to market.

It will also continue to focus on strategically located assets in first choice submarkets across the US where economic, population and employment growth outpace the national average.

Units in Keppel-KBS US REIT closed 5.43% higher at 68 US cents on Thursday.

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