Axis REIT's 2Q earnings ease on lower occupancy, declares 2.3 sen distribution

PETALING JAYA (July 31): Axis Real Estate Investment Trust (Axis REIT) reported slightly lower earnings for the second quarter ended June 30, 2026 (2QFY2026), as lower occupancy across parts of its portfolio and higher one-off property expenses weighed on performance, while declaring a second interim income distribution of 2.30 sen per unit.

It said in a Bursa Malaysia filing on Thursday (July 30) that net profit had slipped 1.4% to RM46.3 million from RM47 million a year earlier, while revenue declined 1.6% to RM88.8 million from RM90.3 million. Basic earnings per unit eased to 2.28 sen from 2.32 sen.

The second interim distribution comprises 2.28 sen taxable and 0.02 sen non-taxable income, compared with 2.65 sen declared for the corresponding quarter last year. Axis REIT Managers Bhd said the distribution represents about 99% of realised income available for distribution for the period from April 1 to June 30, 2026.

In its quarterly review, Axis REIT Managers Bhd said property income for the quarter fell 2.3% from the preceding quarter mainly because of lower occupancy within its existing portfolio. Property expenses rose 9.9%, primarily due to higher one-off property expenses, leading to a 7.8% decline in realised income before non-distributable lease incentive adjustments.

For the first six months ended June 30, Axis REIT posted stronger earnings despite marginally lower revenue. Revenue edged down 0.4% to RM179.4 million from RM180.1 million, while net profit rose 3.6% to RM99.5 million from RM96.1 million. Profit before tax increased 2.9% to RM99.5 million, while earnings per unit improved to 4.91 sen from 4.76 sen.

The trust declared total distributions of 4.80 sen per unit for the first half of 2026, compared with 5.15 sen in the corresponding period last year. Realised net income generated from operations amounted to RM96.8 million during the six-month period, after deducting RM25.7 million in property expenses and RM56.8 million in non-property expenses.

Axis REIT incurred RM4.77 million in major capital expenditure during the first half, comprising RM3.56 million for property enhancement works and RM1.21 million for development projects.

As at June 30, Axis REIT's portfolio comprised 70 industrial and logistics-related properties with total assets under management of RM5.42 billion. Portfolio occupancy stood at 93%, with 15.3 million sq ft of space under management and a weighted average lease expiry (WALE) of 4.2 years.

Net asset value stood at RM3.42 billion, or RM1.6873 per unit before the second interim distribution, compared with RM1.6907 at end-2025.

The units will trade ex-distribution from Aug 12, ahead of the Aug 13 entitlement date. The 2.30 sen second interim distribution will be paid on Aug 28.

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