CapitaLand Retail China Trust’s 3Q DPU falls 10.6% to 2.36 cents on forex losses

SINGAPORE (Oct 25): CapitaLand Retail China Trust (CRCT) posted a 10.6% decline in 3Q distribution per unit (DPU) to 2.36 cents from 2.64 cents the year before.

This brings CRCT’s annualised DPU to 9.39 cents, down 10.3% from a year ago.

Gross revenue for the quarter fell 8.5% to S$50.6 million (RM151.59 million) from S$55.3 million in 3Q15, a decrease of S$4.7 million, due weaker renminbi (RMB) against SGD.

In RMB terms, gross revenue decreased just by 1.2% (or RMB3 million) to RMB248.8 million as CRCT’s revenue reported for 3Q16 was netted off against 5% VAT.

Net property income (NPI) stood at S$32.8 million, down 6.9% from S$35.2 million in 3Q15.

In a Tuesday filing, CRCT’s manager, CapitaLand Retail China Trust Management Limited (CRCTM), says CapitaMall Minzhongleyuan and CapitaMall Wuhu continue to face challenges from the road closure and tenancy adjustments respectively.

CapitaMall Grand Canyon also registered 3.9% lower revenue due to lower actual occupancy rate as a result of delay in opening by tenants occupying large areas. In SGD terms, gross revenue decreased by S$6.4 million compared to YTD 2015 due to weaker RMB against SGD.

“The sustained moderate growth [in China’s economy] reflected the Chinese government’s commitment towards economic reforms, which was also affirmed by the International Monetary Fund’s recent move to include the Chinese yuan in its Special Drawing Right basket,” states CRCTM’s chairman, Victor Liew.  

“In view of China’s continuing efforts to stimulate domestic consumption to drive economic expansion, CRCT remains positive on China’s retail growth prospects.”

Tony Tan, CEO of CRCTM, says he expects CRCT’s recently-acquired Galleria mall in Chengdu to begin contributing income from 4Q this year.

Units of CRCT closed flat at S$1.60 on Monday. — theedgemarkets.com.sg