CMMT’s 2Q distribution exceeds forecast

Written by Max Koh 
Wednesday, 13 July 2011 12:16

KUALA LUMPUR: CapitaMalls Malaysia Trust (CMMT) recorded a distribution per unit (DPU) of two sen for its 2Q ended June 30, 2011, higher than its forecast distribution, owing mainly to savings in financing costs.

In a statement yesterday, CMMT manager CapitaMalls Malaysia REIT Management Sdn Bhd (CMRM) said the higher DPU —  some 8.1% above the forecast of 7.42 sen for the full year when annualised — was achieved on the back of RM57.2 million in gross revenue in 2Q. Distributable income was RM29.8 million while net property income came in at RM40.8 million for the quarter.

CMMT yesterday also announced an income distribution of 2.16 sen per unit for the period from March 25 to June 30, bringing total distribution for the first half of 2011 to 3.9 sen per unit. Book closure for the second distribution is July 27 and payout is intended on Aug 23.

For the six months, CMMT’s distributable income was RM29.79 million, achieved on the back of RM40.77 million in net property income and RM109.9 million in revenue.

Looking ahead, CMRM chairman Kee Teck Koon said the company was optimistic on the retail sales outlook, underpinned by steady domestic population and tourist arrival growths. “Malaysia’s population is expected to increase by 7.2% from 27.6 million last year to 29.6 million by 2014, and the annual tourist arrival target has been raised to 25 million and more for 2011 and beyond,” Kee said in a statement.

The Sungei Wang Plaza in Bukit Bintang, KL.

Since listing of CMMT in July last year, the REIT (real estate investment trust) has completed the acquisition of Gurney Plaza Extension, and had recently proposed to acquire East Coast Mall in Kuantan. “When completed, CMMT will have a portfolio of four well-performing malls in Penang, Kuala Lumpur, Selangor and Kuantan,” said Kee, adding that CMMT is well-positioned to ride on the projected growth in retail sales.

CMRM CEO Sharon Lim continues to see strong demand for retail space in its malls, with occupancy rate at 99.1%. Its performance in 2Q had proven that its management strategies were effective with the repositioning of The Mines, upgrading of Sungei Wang Plaza and the acquisition of Gurney Plaza Extension, she said.

“Our existing portfolio of three malls has been revalued higher from RM2.37 billion to RM2.43 billion by independent valuers. This reflects the success of our continuing asset enhancement initiatives,” she said in the statement.

She added that its tenants had posted higher sales, which enabled CMMT to increase its rental income. “Given the positive outlook and our proactive management, CMMT is well on track to achieve our forecast of 7.46 sen DPU this year,” she said.

CMMT closed one sen lower at RM1.29 yesterday with 209,800 units done.

This article appeared in The Edge Financial Daily, July 13, 2011.