Mapletree Logistics Trust Review @ 26 October 2021

Basic Profile & Key Statistics

Mapletree Logistics Trust (MLT) is a logistics REIT that invests in 163 properties across 9 countries.

Performance Highlight

Gross revenue, NPI, distribution and DPU increased YoY mainly due to contribution from acquisitions completed in FY20/21, higher occupancy from Mapletree Ouluo Logistics Park Phase 2 which completed redevelopment in 1Q FY20/21 and higher revenue from existing properties.

Rental reversion is at 2.4% for 2Q FY21/22. 

There are 4 proposed acquisitions that are pending. Besides the Mapletree Logistics Hub in Malaysia, the other 3 are targeted to be completed by this year end.

Related Parties Shareholding

• REIT sponsor's shareholding is high at 31.221%
• REIT manager's shareholding is low at 0.054%
• Directors of REIT manager's shareholding is low at 0.02%

Lease Profile

• Occupancy is high at 97.8%
• Income in SGD/Major Currencies is low at 47.9%.
• WALE is moderate at 3.7 years
• Highest lease expiry within 5 years is slightly high at 28.5% which falls in FY22/23
• Weighted average land lease expiry is slightly short at 55.08 years

Debt Profile

• Gearing ratio is moderate at 38.2%. Include perps, gearing is at 42.1%.
• Cost of debt is  low at 2.2%
• Fixed rate debt % is moderate at 76%
• Unsecured debt % is high at 91.3%
• WADM is long at 3.6 years
• Highest debt maturity within 5 years is low at 20% which falls in FY23/24
• Interest coverage ratio is high at 5.2 times
• Preferred/perpetual securities over debt is moderate at 9.3%

Diversification Profile

• Top geographical contribution is low at 30.1% 
• Top property contribution is low at 9.1% 
• Top 5 properties contribution is low at 22.1% 
• Top tenant contribution is low at 7.3% 
• Top 10 tenants contribution is low at 25.8%
• Top 3 countries contribution is from Singapore, Hong Kong and China which contribute around 2/3 of GRI

Key Financial Metrics

• Property yield is moderate at 5.2%
• Management fees over distribution is high at 19.7% in which unitholders receive S$ 5.08 for every dollar paid 
• Distribution on capital is moderate at 3.6%
• Distribution margin is high at 55.9%
• 1.9% of DPU is from distribution from asset disposal (exclude 5 divested properties in Japan and 7 Tai Seng Drive)

Trends

• Uptrend - DPU, NAV per Unit, Distribution Margin
• Flat - Distribution on Capital
• Downtrend - Interest Coverage Ratio, Property Yield

Relative Valuation

• P/NAV - Average for 1y & 3y; Above average for 5y
• Dividend Yield - Above average for 1y; Below average for 3y; Below -1SD for 5y

Author's Opinion

Favorable	Less Favorable
High REIT Sponsor's Shareholding	Low REIT Manager's Shareholding
High Occupancy	Low Directors of REIT Manager's Shareholding
Low Cost of Debt	Low Income in SGD/Major Currencies
High Unsecured Debt %	Non-Competitive Management Fees
Long WADM	Interest Coverage Ratio Downtrend
Well Spread Debt Maturity	Property Yield Downtrend
High Interest Coverage Ratio
Low Top Geographical Contribution
Low Top Property & Top 5 Properties Contributions
Low Top Tenant & Top 10 Tenants Contributions
High Distribution Margin
DPU Uptrend
NAV per Unit Uptrend
Distribution Margin Uptrend

MLT fundamentals remain solid and continue to deliver a good quarter performance. With the positive rental reversion and announced acquisitions which are targeted to complete by this year end, its performance should be improved moving forward.

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*Disclaimer: Materials in this blog are based on my research and opinion which I don't guarantee accuracy, completeness, and reliability. It should not be taken as financial advice or a statement of fact. I shall not be held liable for errors, omissions and loss or damage as a result of the use of the material in this blog. Under no circumstances does the information presented on this blog represent a buy, sell, or hold recommendation on any security, please always do your own due diligence before any decision is made.