KUALA LUMPUR (Jan 29): After reporting lower 2018 earnings, CapitaLand Malaysia Mall Trust (CMMT) is banking on Sungei Wang Plaza's new five-storey annexe block to boost rental contribution this year.

Low Peck Chen, chief executive officer of CMMT’s manager CapitaLand Malaysia Mall REIT Management Sdn Bhd, told a press briefing that "numbers should be better this year" as the block — branded as 'Jumpa' — opens its doors to shoppers in early June.

She added that about 30% of the tenants have been secured so far. This includes climbing gym Camp5 Plus as its “mini-anchor” as well as other food and beverage, fashion accessory tenants.

CMMT also expects the continued strong performance of Gurney Plaza in Georgetown and East Coast Mall in Kuantan to help boost its earnings for the current year ending Dec 31, 2019 (FY19).

In a stock exchange filing today, CMMT announced a 35% drop in its net profit for the fourth quarter of FY18 to RM34.63 million, from RM53.65 million in the year-ago fourth quarter, impacted by lower contribution from its Klang Valley shopping malls.

Quarterly net property income (NPI) fell 8.2% to RM52.83 million from RM57.57 million previously.

Gross revenue, meanwhile, contracted 5.5% to RM86.91 million, from RM92.01 million.

CMMT attributed the weaker performance to lower occupancy at Sungei Wang in Kuala Lumpur, The Mines in Seri Kembangan, and 3 Damansara in Petaling Jaya; downtime from asset enhancement works at Sungei Wang, as well as lower rental rates at Sungei Wang and The Mines.

It proposed a final income distribution of RM79.3 million or 3.88 sen per unit, payable on March 8. This brings its full-year distribution per unit (DPU) to 7.9 sen, lower than 8.22 sen in FY17.

For the full year, CMMT turned in a 16.3% decline in net profit to RM135.63 million compared with RM162.1 million in FY17.

Net property income stood 9.4% lower than in FY17, at RM214.97 million versus RM237.15 million before.

Gross revenue came in 5.1% lower at RM350.15 million compared with RM368.93 million in FY17.

Chairman of CMRM David Wong expects consumer and business sentiments to remain cautious this year due to increasing uncertainties in the global economy and concerns around the rising cost of living.

"Despite the challenging operating environment, we will continue to strengthen CMMT's performance by proactively managing lease renewals and exploring opportunities in asset enhancement initiatives and acquisitions that will then create value for our unitholders," Wong said in a separate statement.

At market close today, CMMT settled unchanged at RM1.06 for a market capitalisation of RM2.17 billion.