- Mapletree Industrial Trust (SGX:ME8U)’s 1QFY24 (Apr to Jun 2023) results came in within our expectations. Gross revenue and net property income (NPI) rose 1.7% and 0.7% y-o-y to S$170.6m and S$130.8m, respectively.
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- The decline in DPU was attributed largely to higher borrowing costs (+32.5% y-o-y) and an enlarged unit base (+3.4% y-o-y). 1QFY24 DPU accounted for 25.4% of our initial FY24 forecast.
Portfolio weighted average rental reversions of 5.3% for renewal leases but occupancy under further pressure
- Mapletree Industrial Trust achieved positive rental reversions for its renewal leases for all its business segments except Business Parks (-0.9%) in 1QFY24. This came in at +8.5% for Stack-Up/Ramp-Up Buildings, +6.7% for Flatted Factories, +5.5% for Light Industrial 8% for Hi-Tech Buildings.
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- Both Singapore (-1.7 ppt q-o-q to 93.7%) and North America (-1.3 ppt q-o-q to 92.4%) contributed to the fall. In Singapore, the main drag came from Light Industrial Buildings, which experienced a substantial dip from 97.1% (as at 31 Mar 2023) to 58.7%. Management views some of these vacancies as transitory.
Higher aggregate leverage ratio of 38.2% with 78.0% of debt hedged
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