SINGAPORE (Aug 10): The manager of iREIT Global has declared a distribution per unit (DPU) of 1.45 cents for the 2Q17 ended June, down 9.4% from its 1.6 cents DPU in the same period a year ago.
This was after taking into consideration the forward foreign currency exchange contracts which the trust entered into to hedge the currency risk for distribution to unitholders, says the manager in a press release on Tuesday.
DPU in euro terms was 93 € cents, down 10.6% from 1.04 € cents for 2Q16.
Together with the DPU for 1Q17, unitholders will receive a DPU for 1H17 of 2.89 cents, which translates to an annualised distribution yield of about 7.6% based on IREIT’s closing unit price of 76 cents on June 30.
Distribution to unitholders for 2Q17 stood at €5.8 million, a decrease of 9.5% compared to 2Q16, mainly due to the retention of part of the distributable income for the period, in accordance with iREIT's current distribution policy.
Property operating expense over the quarter grew 16.3% to €1 million from €0.8 million in the preceding year, mainly due to an increase in recoverable property operating expenses.
As the expenses were fully recoverable from the tenants, iREIT’s manager says the increase did not have any negative impact on the net property income for the period
Administrative costs and other trust expenses over the quarter were 17.1% and 296.4% higher than that of 2Q16 respectively.
In other trust expenses, a foreign exchange loss of €115,000 was recorded as compared to a foreign exchange of €48,000 arising mainly from the translation of Singapore dollar denominated cash balances as at end-June.
Excluding the foreign exchange differences, other trust expenses were €214,000 compared to 2Q17 €131,000 in 2Q16.
The increase in administrative costs and other trust expenses for 2Q 2017 was mainly due to timing differences in the accruals of certain administrative and other trust expenses, says the manager.
Cash and cash equivalents stood at €20.7 million as at end-June compared €21.3 million at end-2Q16.
As at end June, IREIT’s total portfolio occupancy rate remained at close to 100% and the weighted average lease expiry was 5.5 years.
“We are pleased to report another set of stable results for this quarter. This is testament to the strength of IREIT’s portfolio which is underpinned by its freehold quality assets, long stable leases and diversified blue chip tenant base,” says Aymeric Thibord, CEO of the manager.
“Building on its strong existing asset portfolio as a foundation, IREIT will seek to enhance long-term income by investing in income-producing quality assets across Europe, in particular in Germany, France and Italy. It is focused on executing a growth strategy based on the four pillars of seeking diversification, achieving scale, taking a long-term approach and having local presence,” he adds.
Units of IREIT closed flat at 80 cents on Thursday.
