3QFY24: Singapore Leading The Charge
MPACT’s Singapore portfolio, including VivoCity, MBC, mTower, Mapletree Anson and BOAHF, has grown from strength to strength. Overseas properties have not fared as well, with management cautioning weakness for business park property Sandhill Plaza in Shanghai, China. MPACT trades at FY25 distribution yield of 6.3% and P/NAV of 0.80x. Maintain BUY. Target price: S$1.86.
RESULTS
• Mapletree Pan Asia Trust (MPACT) reported DPU of 2.20 S cents for 3QFY24 (-9.1% yoy), which is slightly below our expectations. The decline in DPU would be 1.8% yoy if we exclude one-off cross currency interest rate swap gain from 3QFY23.
• Maintains stable NPI despite weakness in JPY and CNH. Revenue and NPI increased 0.8% and 1.7% yoy respectively in 3QFY24. Singapore properties generated strong performance but contributions from overseas properties were weighted down by weakness in JPY (-9.5% yoy) and CNH (-3.6% yoy) against SGD. Portfolio occupancy rose 0.4ppt qoq to 96.7%. NPI margin improved 0.7ppt yoy to 75.5% despite an increase in cost of utilities by 6.8% yoy. Finance costs increased 14.1% yoy.
• Singapore: Broad-based growth across retail and office properties. VivoCity and MBC achieved positive rental reversion of 6.7% and 14.2% respectively in 3QFY24. VivoCity has completed reconfiguration for its Food & Beverage cluster at Level 1 from three to four units and added an indoor refreshment area. NPI from VivoCity and MBC increased 10% and 3.3% yoy respectively in 3QFY24. NPI from other SG properties, namely mTower, Mapletree Anson and BOAHF, also increased substantially by 8% yoy due to high occupancy of 99.3%.
• Hong Kong: Festival Walk provided stable contributions. Festival Walk maintained full occupancy but continued to clock negative rental reversion at -8.1% in 3QFY24 (1HFY24: – 9.5%). Shopper traffic increased 5% yoy in 3QFY24. Unfortunately, tenant sales were affected by higher outbound travelling during the year-end. Festival Walk was able to generate higher income from its atrium space, car park and ice skating ring since Hong Kong reopened its economy in Apr 22.
