SINGAPORE - CapitaLand Integrated Commercial Trust (CICT)’s distribution per unit (DPU) rose by 1.5 per cent to 5.3 cents for the first half of its financial year ended June 30, 2023, from 5.22 cents the year before.
Gross revenue for the half-year period was up 12.7 per cent to $774.8 million, from $687.6 million in the same period a year earlier.
This was mainly due to contributions from CICT’s acquisitions of CapitaSky and its Australian portfolio, its asset enhancement initiative at Raffles City Singapore, and increased rental income from most of its Singapore properties, the trust’s manager said on Tuesday.
These gains were partially offset by a 47.4 per cent year-on-year increase in finance costs from additional borrowings for the acquisitions and higher interest rates.
Net property income (NPI) grew 10.1 per cent on the year to $552.3 million for the half year, from $501.6 million.
CICT had also received a one-time government grant of $34.4 million in the half-year period to defray the costs for construction of an underground pedestrian link at Funan Mall.
Distributable income rose 1.7 per cent year on year to $353.2 million, from $347.3 million.
The distribution will be paid out on Sept 15, 2023, after the record date on Aug 10, 2023.
CICT’s financial performance in the second quarter was boosted by full contributions from CapitaSky in Singapore, as well as 101-103 Miller Street and Greenwood Plaza in Sydney, as the acquisitions of these assets were completed during the quarter.
This resulted in an 11 per cent year-on-year growth in gross revenue to $386.3 million for the quarter, along with a 9 per cent higher NPI of $276 million for the second quarter.
Topline improvements for the latest quarter were however offset in part by higher operating expenses, largely due to utilities, noted the manager.
Mr Tony Tan, chief executive of the trust’s manager, said that CICT had also increased its committed occupancy rates and achieved positive rent reversions for its office and retail assets over the first half of financial year (FY) 2023.
As at June 30, CICT’s committed portfolio occupancy was up by 0.5 percentage point to 96.7 per cent from 96.2 per cent as at March 31. Committed occupancies for its retail, office and integrated development portfolios stood at 98.7 per cent, 95.4 per cent and 97.8 per cent respectively.
For the half-year period, the office and retail leases in its Singapore portfolio reported positive rent reversions of 9.6 per cent for office and 6.9 per cent for retail.
The weighted average lease expiry (Wale) for the trust’s overall portfolio stood at 3.6 years. Wale for its portfolios stood at 2.2 years for individual retail, 3.6 years for office and 5.3 years for integrated development portfolios.
Mr Tan noted that the CQ @ Clarke Quay development will finish its phased asset enhancement initiative works by the late second half of FY2023. The asset is expected to contribute positively to the trust’s performance in FY2024 when its tenants progressively begin operations.
“Looking ahead, we will focus on strengthening our portfolio and optimising the potential of our overseas properties through proactive management,” said Mr Tan.
CICT units closed trading on Tuesday unchanged at $2.04. THE BUSINESS TIMES
