OUE Commercial REIT has reported higher net property income and revenue for 2HFY2022 ended Dec 31, 2022, as it paid out lower rental rebates with the pandemic easing.
However, after taking into account lower income support for OUE Downtown Office and higher interest expense, the 2HFY2022 amount available for distribution was 19.1% lower y-o-y at $52.1 million.
With the partial distribution of divestment gain from OUE Bayfront of $4.6 million, 2HFY2022 amount to be distributed was $56.7 million, translating to a distribution per unit of 1.04 cents, down 24.1% y-o-y. The book for the distribution will close on Feb 7 and distribution will be made on Feb 28.
Net property income was up 8.6% y-o-y to $103.3 million, while revenue was up 8% to $125.7 million.
For whole of FY2022, DPU was down 18.5% y-o-y to 2.12 cents. Net property income was down 3.6% y-o-y to $196.9 million, while revenue was down 3.4% to $241.5 million.
Thanks to the revaluation of its Singapore portfolio, the valuation of OUE C-REIT’s portfolio has increased 2.6% y-o-y to $6.2 billion. Net asset value per unit, as at Dec 31, 2022, was 59 cents.
The REIT owns properties such as the Hilton Singapore Orchard.
The REIT has no further refinancing requirements until this September, with 11.8% of its total debt, or some $273 million, due. There’s no debt due in the coming 2024.
Han Khim Siew, CEO of the REIT’s manager, calls 2HFY2022 a period characterised by continued operating challenges posed by geopolitical tensions, inflationary pressures, interest rate hikes and macroeconomic headwinds.
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The REIT, by taking an unsecured sustainability-linked loan totalling $978 million for the refinancing of existing secured borrowings, has “structurally strengthened” the “foundation of our capital structure”, as it has diversified its funding sources with the proportion of unsecured debt increasing to 69.4%.
“While we will surely face macroeconomic headwinds in the year ahead, we remain confident in our ability to navigate market uncertainties and deliver positive results for FY2023 with the support of our stakeholders,” adds Han.
OUE C-REIT closed Jan 30 at 37 cents, unchanged for the day, and down 9.76% over the past year.
