Pavilion Kuala Lumpur Mall

KUALA LUMPUR (Oct 26): Pavilion Real Estate Investment Trust's (Pavilion REIT) net property income (NPI) dropped 3.2% to RM78.16 million for the third quarter ended Sept 30, 2017 from RM80.71 million a year earlier, due to higher property operating expenses.

Pavilion REIT said total property operating expenses increased by 17% to RM43.19 million from RM36.83 million, as a result of higher maintenance cost incurred.

This included continuous air conditioning system improvement and upgrading works, replacement of pumps, escalator handrails and steps at the Pavilion Kuala Lumpur Mall as well as the sponsorship for the 2017 SEA Games.

In a filing with Bursa Malaysia, Pavilion REIT announced a distribution per unit (DPU) of 1.96 sen.

Quarterly revenue grew 3.2% to RM121.36 million from RM117.54 million, mainly contributed by the rental income from the Pavilion Kuala Lumpur Mall's tenants after the repositioning exercise.

For the first nine months of FY17, Pavilion REIT posted an NPI of RM233.85 million, a decline of 1.7% from the RM237.78 million recorded in the previous corresponding period, while revenue grew 5.4% to RM360.55 million from RM342.24 million.

For the nine-month period, the DPU declared was 5.92 sen per unit.

Moving forward, Pavilion REIT said although the retail environment is challenging, its marketing team will "continue to create differentiation and key attractions to build shopping experience" to attract and retain shoppers' loyalty to the retail malls with operating cost being monitored to optimise efficiency.

Shares in Pavilion REIT closed one sen or 0.6% higher at RM1.73, bringing its market capitalisation to RM5.24 billion. — theedgemarkets.com

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