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Starhill Global REIT reports 2HFY2022 DPU of 2.02 cents, down 2.4%

Felicia Tan
Felicia Tan7/29/2022 09:23 AM GMT+08  • 3 min read
Starhill Global REIT reports 2HFY2022 DPU of 2.02 cents, down 2.4%
Ngee Ann City. Photo: Samuel Isaac Chua/The Edge Singapore
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The manager of Starhill Global REIT has reported a distribution per unit (DPU) of 2.02 cents for the 2HFY2022 ended June, down 2.4% from the DPU of 2.07 cents from the same period before.

The DPU in the 2HFY2021 includes the release of $4.6 million from the deferred distributable income from FY2020, which translates to 0.21 cents per unit.

Excluding the release, the REIT’s DPU would have been 8.6% higher y-o-y.

In the FY2022, the REIT’s DPU stood 3.8% lower y-o-y at 3.80 cents, or 5.6% higher y-o-y excluding the deferred amount.

During the 2HFY2022, gross revenue increased by 2.8% y-o-y to $95.5 million

Net property income (NPI) increased by 7.6% y-o-y to $75.1 million due to the cessation of rental rebates in Malaysia following the completion of asset enhancement works at The Starhill in December 2021.

See also: Banyan Tree announces improved earnings in business update

Lower operating expenses, partially offset by the lower rental contribution from Wisma Atria and the depreciation of the Australian dollar (AUD) against the Singapore dollar (SGD), also led to the higher 2HFY2022 NPI.

Distributable income increased by 4.9% y-o-y to $47.1 million mainly due to the higher NPI. However, the manager will retain $1.9 million of income available for distribution for the period for working capital requirements.

As at June 30, the REIT’s retail portfolio occupancy stood at 96.7% with a long weighted average lease expiry (WALE) of 7.2 years by net lettable area (NLA).

See also: CDL reports high occupancies for Singapore office, recovery in retail and hotel portfolios

Gearing stood at 36.2% as at June 30.

“The hospitality, tourism, aviation and retail sectors have seen a marked recovery as countries progressively open their borders. Notwithstanding elevated geopolitical tensions and inflationary pressures, we remain cautiously optimistic that the retail and commercial real estate markets will continue to experience growth, particularly in the Asia Pacific region.,” says Tan Sri Francis Yeoh, chairman of the manager.

“Interior upgrading works at Wisma Atria continue to progress as scheduled and will be completed by end-2022. The refurbished Wisma Atria will sport a refreshed, modern aesthetic design to cater to the evolving preferences of shoppers and retailers,” adds Ho Sing, CEO of the manager.

“The rejuvenated portfolio better positions us to benefit from the opening of borders. As the world recovers from the pandemic, tenant sales in 4QFY2021/2022 at Wisma Atria surpassed pre-pandemic sales by 4.8% over the corresponding period in 4QFY2018/2019. This is despite ongoing rejuvenation works,” he adds.

“Amidst global inflation concerns and rising interest rates, our prudent capital management approach has allowed us to buffer these pressures. 93% of our borrowings have been fixed or hedged as at June 30, and our average debt maturity stands at 3.5 years, while gearing level remains stable at 36.2%,” he continues.

Unitholders can expect to receive their DPUs on Sept 23.

Units in Starhill Global closed at 59.5 cents on July 28

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