SPH REIT
SK6U.SI
SPH REIT - 4QFY16 results within our expectations
- SPH REIT reported its 4QFY16 results which met our expectations.
- Gross revenue rose 2.7% YoY to S$52.2m, while NPI grew at a faster pace of 5.3% to S$40.2m due to lower utility tariff rates and advertising and promotion and maintenance expenses. DPU was up 1.4% YoY to 1.41 S cents.
- For FY16, SPH REIT's gross revenue increased 2.2% to S$209.6m and this formed 99.1% of our full-year forecast, while DPU of 5.50 S cents represented growth of 0.5% and matched our projection.
- Operationally, Paragon and The Clementi Mall (TCM) registered positive rental reversions of 5.2% and 7.8%, respectively, for FY16, which culminated in an overall portfolio rental uplift of 5.4%. Both malls saw slightly lower visitor traffic in FY16 (Paragon -2.5% and TCM -2.4%). Paragon's tenants' sales inched up 0.3%, but TCM recorded slightly lower tenants' sales of 1.4%.
- Looking ahead, we forecast SPH REIT to deliver a steady DPU growth of 1.5% in FY17, given its resilient portfolio.
- Maintain BUY and S$1.05 fair value estimate on SPH REIT.
Wong Teck Ching Andy CFA
OCBC Investment
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http://www.ocbcresearch.com/
2016-10-07
OCBC Investment
SGX Stock
Analyst Report
1.05
Same
1.050
