Friday 29 Mar 2024
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KUALA LUMPUR (Aug 8): Hektar Real Estate Investment Trust’s (Hektar REIT) net property income (NPI) for the second quarter ended June 30, 2017 (2Q17) fell by 4.5% to RM18.04 million from RM18.89 million in the same quarter last year, due to higher operating expenses.

“Performance is affected by higher operating expenses and slower growth in the retail industry which is causing reversions to remain flat,” said chief executive officer Datuk Hisham Othman in a press statement.

In a filing with Bursa Malaysia, Hektar REIT declared a distribution per unit together with an advance distribution for the period of July and August 2017 of four sen per unit amounting to RM16.03 million, to be made on Sept 22 this year.

“There will be no tax payable as Hektar REIT intends to distribute at least 90% of the distributable income to unit holders for the year ending 31 December 2017,” it said in maintaining its distribution policy.

Revenue for 2QFY17 came in at RM30.79 million, down 0.5% from RM30.94 million a year earlier.

For the cumulative six months of FY17 (1HFY17), Hektar REIT posted a 4.9% decline in NPI at RM35.72 million from RM37.56 million in 1HFY16, corresponding to a 1% lower revenue for the same period last year.

Meanwhile, the cumulative realised net profit was lower by 7%, from RM21.13 million last year to RM20.11 million this year, mainly due to lower revenue from Subang Parade, it said.

Hektar REIT is managed by Hektar Asset Management Sdn Bhd.

“Retail business in Malaysia continues to remain challenging in 2017. Hektar is expected to complete the acquisition of 1Segamat Shopping Centre in September 2017,” it said in regards to the prospect of the trust.

It also noted that the Asset Enhancement Initiative at Landmark Central in Kulim, Kedah is expected to be completed by end September 2017.

Both exercises are expected to contribute positively to Hektar, it added.

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