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CMMT’s 4Q NPI down 16.5% q-o-q, pays 3 sen DPU for FY20

KUALA LUMPUR (Jan 23): CapitaLand Malaysia Mall Trust’s (CMMT) net property income (NPI) fell 16.5% to RM34.03 million in the fourth quarter ended Dec 31, 2020 (4QFY20) from RM40.75 million in 3QFY20, on lower rental and car park income.

The poorer performance was due to the reintroduction of conditional Movement Control Order from Oct 14 last year, which resulted in lower shopper footfalls that affected tenants’ businesses, amid lower occupancies. It also extended targeted rental rebates to the affected tenants.

The mall operator reported a distributable income of RM17.85 million and distribution per unit (DPU) of 0.86 sen for the quarter, for a total DPU payout of three sen for the year.

Quarterly revenue was down 4.4% to RM66.94 million from RM70.05 million in 3QFY20.

On a year-on-year basis, its NPI was 31.7% lower from RM49.84 million in 4QFY19, while revenue was down 22% from RM85.8 million.

Also, a net fair value loss of RM157.9 million was recognised during the quarter upon the revaluation of its investment properties, attributable mainly to its Klang Valley malls.

For the full year ended Dec 31, 2020 (FY20), CMMT's NPI fell 33.9% to RM133.5 million from RM202.12 million a year ago, while revenue dropped 23.6% to RM261.4 million from RM342.28 million, mainly due to the rental relief it granted to tenants affected by the pandemic outbreak.

On prospects, CMMT said the issues of retail space oversupply and challenges arising from the impact of Covid-19 are expected to continue in 2021. “With the reintroduction of the MCO and the country’s state of emergency, shopping malls may continue to experience downward pressure on shopper footfall and retail sales,” CMMT added.

The pandemic has accelerated the growth of pre-existing trends, including the rise of online shopping. “As we continue to roll out marketing support initiatives to build shopper loyalty, we have also stepped-up digital adoption among tenants, in line with our vision of offering shoppers an omnichannel retail experience,” CMMT said.

Under the reinstated MCO from Jan 13, 2021, only essential services tenants and other allowable trades are open in all of CMMT malls.

“Given the economic uncertainties, we expect business and consumer sentiments to remain subdued in 2021,” said CapitaLand Malaysia Mall REIT Management Sdn Bhd (CMRM) chairman David Wong, in a separate statement.

Meanwhile, CMRM chief executive officer Low Peck Chen said CMMT has set aside a holistic RM35 million rental relief package in the form of targeted rental rebates and marketing support, in line with its commitment to ride out the COVID-19 challenges with its tenants.

CMMT’s 2020 rental reversion eased by 11.8% and portfolio occupancy as at Dec 31, 2020 was lowered to 86.6% on the back of the softer retail operating environment. As a result, portfolio valuation fell 3.5% year-on-year to RM3.9 billon.

Shopper traffic and tenant sales per square foot for 2020 was at about 57% and 81% of 2019’s levels respectively, she added.

CMMT’s share price closed half a sen or 0.81% higher at 62 sen yesterday, valuing the trust at RM1.28 billion.

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