Thursday 28 Mar 2024
By
main news image

KUALA LUMPUR (Nov 4): Tower Real Estate Investment Trust’s (REIT) net profit fell 49% to RM4.3 million in the third quarter ended Sept 30, 2014 (3QFY14), from RM8.4 million in the previous corresponding quarter.

The REIT is part of Tan Sri Quek Leng Chan's stable of Hong Leong Group companies.

Revenue dropped 24% to RM10.1 million from RM13.3 million previously, which the REIT, in its filing to Bursa Malaysia today, blamed on lower occupancy rates in Menara ING and Menara HLA.

Its basic earnings per unit also fell 49.5% on-year to 1.52 sen from 3.01 sen.

The REIT, which focuses on commercial properties, also reported a significantly lower net realised income of RM4.2 million in the quarter under review, down 49% from last year’s RM8.3 million, which it said was mainly due to lower revenue and higher operating expense.

The higher operating expense was mainly due to assessment and electricity tariff hikes, it added.

Its net asset value per unit also came in lower at RM1.79 as at Sept 30, 2014, as compared to RM1.82 in the preceding quarter.

Net profit for the nine-month period (9MFY14) stood at RM16.5 million versus RM24.8 million in the previous corresponding period, down 33.47%. Meanwhile, net realised income also fell 34% from a year ago to RM15.85 million. Revenue for the period was at RM33.9 million, down 16.30% from RM40.5 million a year ago.

The REIT said its prospects will continue to be “challenging” due to the oversupply of office spaces.

Recalling the last quarter, it said both office occupancy and rental rates continue to come under pressure due to the incoming supply of newer buildings with better specifications and the limited demand growth.

Year-to-date, Tower REIT had paid an interim income distribution of 3.83 sen per unit in August. Its unit closed unchanged at RM1.32 today, with a market capitalisation of RM370.3 million.

      Print
      Text Size
      Share