Better showing from hospitality and Vietnam
? 1HFY22 PATMI (before perpetuals) of S$158.2m, was broadly in line at
55.4% of our FY22 forecast.
? Higher unbilled residential revenue of S$2.4bn at end-1HFY22.
? Reiterate Add with an unchanged TP of S$1.41.
1HFY9/22 results highlights
FPL reported a 7.5% increase in 1HFY9/22 revenue to S$1.68bn. However, PATMI (before
perpetuals) decreased 42.7% yoy to S$158.2m, due to a high base in 1HFY21 with the
inclusion of gain on change in use of properties held for sale, partly offset by higher
revaluation gains in 1HFY22, increased hospitality contributions and higher Vietnam
earnings. Net debt to equity ratio declined to 69.6%, and 76.2% of its debt were on fixed
rates as at end-Mar.
Higher unbilled residential revenue of S$2.4bn
Unbilled residential revenue in Singapore rose qoq to S$0.6bn on higher take-up rate of
47.7% at Riviere and Parc Greenwich (97% sold). Plans for the redevelopment of Bedok
Point Mall are in progress, with the residential component launch scheduled for 2022F. In
Australia, FPL sold 949 units and settled 370 units in 1HFY22. Unbilled revenue in Australia
remained stable at S$1.4bn as at end-Mar. In Thailand, there were eight new project
launches and 2,400 residential units were sold in 1H. Thailand has S$0.1bn of
unrecognised revenue at end-1H. Vietnam performed better yoy with the handover of sold
units at the Q2 Thao Dien project.
Strong operating metrics within the I&L segment
The industrial & logistics (I&L) portfolio remained robust, with a high occupancy rate of
97.8-100% as at end-1HFY22, amid strong leasing activity. FPL is developing 15 new
assets totalling 487k sq m in Australia and Europe, with a gross development value (GDV)
of S$1.2bn, to be completed over FY22-23F. FPL has a total remaining L&I landbank of
2.9m sq m across Australia and Europe. Meanwhile, occupancy at its Australia commercial
portfolio was lower yoy at c.81% and FPL continues to adopt an active leasing effort to
boost occupancy. Thailand’s end-1H industrial portfolio occupancy stood at c.78.8-89.4%.
A recovery to profitability for hospitality segment
Hospitality segment posted a PBIT of S$28m in 1HFY22, a turnaround from a loss a year
ago. RevPAR for Asia Pacific and Europe saw a significant yoy rebound in 1H even as
North Asia RevPAR declined yoy. FPL will continue to manage productivity, improve
operational efficiency and execute recovery plans to position for future recovery. It is also
looking to add properties in strategic locations in gateway cities to build portfolio resilience.
In 1HFY22, it entered the Cambodian market with the signing of three new properties. The
group is also expecting another 950 hospitality units to become operational in 2022. Total
units under management grew 3.4% qoq to 16,736 units as at end-Mar.
Reiterate Add rating
We leave our FY22-24F estimates unchanged, and maintain our RNAV at S$2.57 and TP
at S$1.41 (still based on 45% discount to RNAV). Active capital deployment is a potential
re-rating catalyst. Downside risks: slower value unlocking activities due to the weaker
macro outlook.