Friday 29 Mar 2024
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KUALA LUMPUR (April 28): Pavilion Real Estate Investment Trust's (REIT) net property income (NPI) for the first quarter ended March 31, 2016 (1QFY16) stood at RM75.64 million, up from RM72.94 million in 1QFY15.

Its net profit edged up by 1.62% to RM61.47 million from RM60.49 million in the corresponding quarter last year, mainly due to higher NPI.

For the quarter under review, the Group registered a revenue growth of 1.49% to RM106.7 million from RM105.1 million a year ago.

In a note to Bursa Malaysia today, Pavilion REIT said total operating expenses were lower by RM1.1 million or 4% for the quarter under review compared to 1QFY15.

Utilities in 1QFY15 were higher due to Tenaga Nasional Bhd's adjustment for 2014's electricity charge. These have resulted in higher total NPI by RM2.7 million or 4% in 1QFY16 compared to 1QFY15.

"Manager's management fee incurred for the Q1 2016 was higher by RM200,000 compared to Q1 2015. This was in line with the increase in total asset value and NPI.

"Borrowing cost incurred during the quarter was higher by RM2 million compared to Q1 2015 mainly due to the drawdown of additional borrowings for acquisition of investment properties and working capital purposes," it said.

Distributable income for 1QFY16 was RM63.5 million or 2.1 sen per unit, consisting of income after tax of RM61.47 million and non-cash adjustments for depreciation of RM100,000, amortisation of borrowings transaction cost of RM400,000 and 25% of manager's management fee payable in units amounting to RM1.5 million.

According to the announcement in Bursa, the retail environment continues to be challenging due to weak consumer confidence and inflationary pressures. Marketing efforts will persist to drive traffic to retail malls and encourage spending. Leasing continues to enhance the required tenant mix that is relevant to the properties under Pavilion REIT.

The management will continue Pavilion REIT's growth with strategies, such as proactive management of investment properties and implementing asset enhancement properties, active pursuit of acquisition opportunities in accordance with authorised investments of Pavilion REIT stated in Trust Deed and the pursuit of efficient capital management strategy.

As of closing, Pavilion REIT was unchanged at RM1.68, with 544,100 shares done.

 

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