Sunway REIT 4Q NPI up 11%, declares 2.28 sen DPU

KUALA LUMPUR (Aug 9): Boosted by new income contribution from newly acquired Sunway university and college campus, as well as higher retail contribution, Sunway Real Estate Investment Trust (REIT) posted an 11% rise in net property income (NPI) to RM111.18 million for the fourth quarter ended June 30, against RM100.27 million last year.

Net realised income for the quarter increased 6.1% to RM67.16 million from RM63.31 million previously.

The group declared an income distribution per unit (DPU) of 2.28 sen for the quarter, which will be paid on Sept 10. It was the REIT’s fourth income distribution for the year and increased total payout for FY19 to 9.59 sen.

"The stable set of financial performance was achieved on the back of timely completion of the acquisition of Sunway university and college campus, prudent cost management and proactive capital management initiatives," said Sunway REIT Management Sdn Bhd CEO Datuk Jeffrey Ng in a statement yesterday.

The REIT manager expects the DPU in FY20 to stay resilient, primarily supported by full-year income recognition from acquisition of Sunway university and college campus and modest growth in the retail segment. The manager is also committed to distribute 100% of distributable net income in FY20.

However, it remains cautious over the performance of the hotel segment because it expects stronger headwinds for the industry coupled with soft tourist arrivals.

“Looking ahead, the underlying fundamentals surrounding the operating landscape remains challenging on the back of global whirlwind, moderation in domestic economy and fluidity in Government policies amidst the New Government reform,” said Ng.

In the fourth quarter, revenue rose 6.8% to RM145.56 million against RM136.25 million a year ago.

As at June 30, the REIT’s property value grew 10.5% to RM8.05 billion from RM7.28 billion before, primarily attributable to acquisitions amounting to RM550 million and fair value gain of RM108 million.

For the full year, the REIT’s NPI grew 4.7% to RM439.7 million, while net realised income was up marginally by 0.1% to RM282.34 million. Revenue rose 3.5% to RM580.3 million.

Sunway REIT closed unchanged at RM1.89 yesterday, valuing the trust at RM5.57 billion.

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