CapitaLand China Trust’s distributable income of $113.9 million in FY2023 ended Dec 31, 2023, was down 9.4% y-o-y while distributions per unit (DPU) fell by 10.1% y-o-y to 6.74 cents as a result of the stronger Singapore dollar versus the RMB, as well as higher interest expense. Notably, distributable income in 2HFY2023 fell by 4.8% to $50.7 million.
Net property income (NPI) rose by 5.3% in FY2023, to RMB1.293 billion ($245.1 million).
Ironically, the increase in NPI was boosted by stronger performance in CLCT’s retail portfolio which constitutes 75.9% of AUM, offset by lower contributions from the new economy portfolio.
In 2HFY2023, CLCT recorded a 10.5% y-o-y increase in NPI to RMB630.0 million, mainly due to improved operating conditions and positive retail momentum driven by higher occupancies and asset enhancement initiatives (AEI).
Boosted by an improved performance across all malls, shopper traffic increased by 45.8% y-o-y while tenant sales grew by 41.5% y-o-y, exceeding 2019 figures since 2QFY2023.
Weaker business sentiments and increased supply in both logistics and business park sectors have impacted the new economy portfolio. As at Dec 31, 2023, CLCT’s business park portfolio maintained its occupancy rate at 91.0% while the occupancy for the logistics park portfolio stood at 82.0%.
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On the capital management front, adjusted ICR improved to 3x from 3.1x q-o-q; aggregate leverage fell q-o-q to 41.5% from 42.4%; total all-in cost of debt rose marginally q-o-q to 3.57% from 3.55% but fixed rate debt remained at a high 82%.
CLCT’s portfolio valuation as at Dec 31, 2023, remained relatively stable, with the diversified portfolio reflecting a y-o-y dip of 0.9%, primarily due to lower signing rents across the market and a slowdown in rental growth rates. As at Dec 31, 2023, CLCT's net asset value was $1.21 compared to $1.38 a year ago.
Units in CapitaLand China Trust AU8U closed flat at 82.5 cents on Jan 29.
