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Sunway REIT 3Q NPI drops 35% to RM67m, dragged by retail and hotel segments

KUALA LUMPUR (May 20): Sunway Real Estate Investment Trust's (Sunway REIT) net property income (NPI) for the quarter ended March 31, 2021 (3QFY21) fell 35.3% to RM67.02 million from RM103.51 million a year ago, as footfall and sales in the retail segment was affected by the imposition of the Movement Control Order (MCO 2.0).

Earnings per share declined significantly to 0.94 sen from 2.06 sen, Sunway REIT's bourse filing yesterday showed.

Quarterly revenue tumbled 26% to RM104.27 million from RM140.80 million, largely due to lower contribution from the retail and hotel segments.

The group did not declare any income distributions to its shareholders for the quarter.

For the nine-month period ended March 31, 2021, the group’s NPI dropped 40.7% to RM201.12 million from RM339.20 million in the previous corresponding period, while revenue fell 32% to RM307.48 million from RM451.95 million, underpinned by various stages of movement restrictions which adversely affected the business operations of the retail and hotel segments.

Sunway REIT CEO Datuk Jeffrey Ng said the trust maintains a cautious outlook for the remaining of the year, adding that the acceleration of mass vaccination rollout is crucial in containing the infection rate to enable the economy to recover.

He said the REIT anticipates business disruptions in the short term due to unexpected mandatory closure order for retail malls, hypermarkets and offices listed under the Hotspot Identification for Dynamic Engagement (HIDE) system.

“We urge the authorities to engage and collaborate with industry players to jointly implement safety and hygiene measures in the premises.

“It would be helpful if the authorities are able to release the HIDE supporting data and information in order for the owners of the malls and premises to make relevant decisions to work with the affected outlets and areas by following stricter SOPs, instead of immediate closure implementation which would cause further adverse pressure on the tenants, businesses, and mall owners,” he stressed.

Ng said the economic fallout from the pandemic has led to more properties being offered in the real estate market.

“In our opinion, this is an opportune time to actively pursue asset acquisition. Sunway REIT is in a favourable position, supported by healthy gearing level and comfortable debt headroom to capitalise on yield accretive acquisition and asset expansion opportunities to drive the future growth of Sunway REIT,” he said.

Units of Sunway REIT ended three sen or 2.07% lower at RM1.42 yesterday, valuing the trust at RM4.86 billion.

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