Sunway REIT’s 3Q NPI jumps 82%, spurred by retail and hotel segments

• Looking ahead, Sunway REIT Management Sdn Bhd — the manager of Sunway REIT — said it remains optimistic on the group’s outlook for FY2022, underpinned by strong growth in its retail segment, gradual recovery in the hotel segment and the new income contribution.

KUALA LUMPUR (Nov 17): Sunway Real Estate Investment Trust’s (Sunway REIT) net property income (NPI) jumped 81.87% to RM128.24 million in the third quarter ended Sept 30, 2022 (3QFY2022) from RM70.51 million a year earlier, carried by substantially improved revenue contributions from its retail and hotel segments.

Quarterly revenue leapt 55.52% to RM166.24 million from RM106.89 million a year prior, according to the REIT’s bourse filing on Thursday (Nov 17), on the back of an overall improvement in performance across all segments.

The more substantial contributions came from its retail and hotel businesses, with segmental revenues improving by 70.01% and 198.12% year-on-year respectively.

“The retail segment continued its strong momentum, supported by encouraging retail sales, improved retail footfall, and new income contribution from the new wing of Sunway Carnival Mall, which was launched on June 24, 2022.

“[Meanwhile], as the nation transitions into the endemic phase, the hotel segment recorded encouraging improvement in average occupancy rates for the quarter under review,” Sunway REIT said.

No income distribution was proposed for 3QFY2022.

For the nine months ended Sept 30, 2022 (9MFY2022), Sunway REIT’s NPI rose 77.13% to RM354.05 million from RM199.88 million in the same period last year, as revenue increased 47.74% to RM464.71 million from RM314.55 million.

According to Sunway REIT, the increase in cumulative earnings was on the back of improved contributions from all the group’s segments, new income contribution from its new wing of Sunway Carnival Mall, as well as the resumption of income contribution pursuant to the phased re-opening of Sunway Resort Hotel.

Looking ahead, Sunway REIT Management Sdn Bhd — the manager of Sunway REIT — said it remains optimistic on the group’s outlook for FY2022, underpinned by strong growth in its retail segment, gradual recovery in the hotel segment and the new income contribution.

“We are pleased to observe sustained momentum for the retail segment supported by robust retail sales and retail footfall.

“The financial performance of Sunway REIT is further boosted by [the] realisation of asset enhancement and property development initiatives which we have undertaken in the past two to three years, as these assets have started to generate additional income to the portfolio,” Sunway REIT Management chief executive officer Datuk Jeffrey Ng said.

Ng further said Sunway REIT Management is closely monitoring the macroeconomic environment affecting economic growth, inflationary pressure, the pace of interest hikes and its potential impact on Sunway REIT’s financial performance.

“The manager proactively optimises its capacity management strategy to minimise the impact of higher finance costs,” he said, adding that the manager strives to increase the REIT’s NPI going forward, to negate any adverse impact.

“We remain steadfast to continue to create and unlock value for Sunway REIT’s asset portfolio in striving towards achieving the strategic goals of Transcend 2025,” he added.

Units of Sunway REIT finished one sen or 0.72% higher at RM1.40, giving the REIT a market capitalization of RM4.79 billion.