Basic Profile & Key Statistics
Frasers Logistics & Commercial Trust (FLCT), recently renamed from Frasers Logistics & Industrial Trust (FLT) after merger with Frasers Commercial Trust (FCOT) in April 2020. FLCT invests in Office, Logistics, and Industrial properties. The above sector breakdown is from the latest presentation, weighted by GRI.
Lease Profile
Occupancy is healthy at 97.2%. WALE is long at 5.2 years where the highest lease expiry within 5 years of 15.5% falls in year 2025. Weighted average land lease expiry is long at 89.54 years, this figure is estimated from latest presentation, by valuation.
Debt Profile
Gearing is healthy at 37.4%. Cost of debt is low at 2.1%. Fixed rate debt is low at 55.3% which is favorable in current low-interest environment. Unsecured debt is slightly low at 69.6%. Interest cover ratio is high at 6.7 times. WADE is long at 3.2 years where the highest debt maturity of 26.4% falls in FY2024.
Diversification Profile
Its top geographical and top properties are estimated from the latest presentation, weighted by property valuation. Its top tenant and top 10 tenants are weighted by GRI. All top geographical, top property, top tenant, and top 10 tenants contribution are low at 21.1%, 10.9%, 4.8%, and 24.1% respectively.
Key Financial Metrics
As FLCT do not provide detail financial statement at this quarter, therefore, besides property yield, all financial metrics are based on past 4 quarters of the pre-merger result. Property yield is moderate at 5.2%. Management fee is moderate in which unitholders receive S$ 7.58 for every dollar paid. Distribution on capital and distribution margin are high at 4.7% & 61.8% respectively. 2.7% of the distribution is from partial distribution of asset disposal.
Related Parties Shareholding
As compare to SREITs median level, sponsor and manager holding lesser stake while directors of REIT manager holding higher stake.
Trend
Note that the actual 3Q 2016 DPU is 1.84 for the period between 20 June 2016 to 30 September 2016, for a fair comparison, I have annualized it to 3 months period to around 1.658. DPU, NAV per Unit (pre-merger) and distribution margin are more or less the same for the past 4 years.
Relative Valuation
i) Average Dividend Yield - Apply pre-merger latest 4 quarters DPU of 6.93 cents to average yield of 6.55% will get S$ 1.06
ii) Average Price/NAV - Average value is at 1.15, apply the latest NAV of S$1.04 will get S$ 1.20.
Author's Opinion
| Favorable | Less Favorable |
| Diversified Sector | |
| WALE | |
| Well Spread Lease Expiry | |
| Cost of Debt | |
| Interest Cover Ratio | |
| WADE | |
| Well Spread Debt Maturity | |
| Top Geographical Contribution | |
| Top Property Contribution | |
| Top Tenant & Top 10 Tenants Contribution | |
| Distribution on Capital (Pre-Merger) | |
| Distribution Margin (Pre-Merger) |
When I am compiling the above table, I am surprised that I couldn't find a significant less favorable point, I have double-checked yet I get the same result. However, since no financial statement is released, we have not enough information to evaluate the performance of post-merger. One thing to note for FCOT pre-merger, around 25 % of FCOT distribution is supported by partial distribution from asset disposal. This is applicable for FY2019 and 1Q FY2020, not sure whether it would impact post-merger DPU. Nonetheless, FLCT is currently in STI reserve list, with its market cap and price movement, it has high potential to be included in STI in the near term.
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NAVs seems to be stable or increasing during this COVID period..
ReplyDeleteNav increase after merger, pre covid time not much change
ReplyDelete