Pavilion REIT's 3Q NPI up 56% q-o-q to RM61m on higher revenue

KUALA LUMPUR (Oct 23): Pavilion Real Estate Investment Trust's (REIT) net property income (NPI) for its third quarter ended Sept 30, 2020 (3QFY20) rose by 55.82% quarter-on-quarter (q-o-q) to RM60.88 million from RM39.07 million in the immediate preceding quarter (2QFY20), thanks to a higher gross revenue.

In a bourse filing yesterday, the REIT announced that its gross revenue was up by 34% q-o-q at RM116.23 million, from RM86.73 million in 2QFY20.

Pavilion REIT declared a distribution per unit (DPU) of 1.13 sen, from the 2.4 sen achieved in the corresponding quarter last financial year (3QFY19).

This brings the cumulative DPU payout for the nine months ended Sept 30, 2020 (9MFY20) to 2.74 sen, from 6.44 sen in 9MFY19.

However, on a year-on-year (y-o-y) basis, the retail REIT saw its NPI decline by 33.16% from RM91.08 million in 3QFY19, while quarterly revenue declined by 19.48% y-o-y from RM144.35 million.

It noted the y-o-y decreases were due to the non-renewal of some expired tenancies and the deferment of rent commencement dates for some tenants due to movement restrictions imposed to combat Covid-19.

Advertising income was also badly impacted.

NPI for 9MFY20 contracted by 41.87% y-o-y to RM165.06 million, from RM283.94 million.

Nine-month revenue shrank by 27.31% y-o-y at RM319.37 million from RM439.39 million in the corresponding period last financial year.

On its prospects, the group noted that visitor numbers have dropped following a resurgence of Covid-19 cases in Malaysia and news of cases in some shopping malls.

"Hence, gross revenue for the next quarter is likely to be affected. The manager (Pavilion REIT Management Sdn Bhd) will continue to be vigilant due to the uncertainties surrounding the economic recovery and is dedicated to remain resilient to drive long-term value for its stakeholders," it said.

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