Mapletree Logistics Trust Review @ 18 May 2023

Basic Profile & Key Statistics

• Main Sector(s): Logistics
• Country(s) with Assets: Singapore, China, Hong Kong, Japan, Australia, South Korea, Malaysia, Vietnam & India
  
• No. of Properties (exclude development/associate/fund): 191

Key Indicators

Performance Highlight

Gross revenue and NPI declined slightly YoY mainly due to the depreciation of RMB, JPY, KRW and AUD against SGD. However, distribution to unitholders improved slightly mainly due to a combination of hedging at the distribution level, higher management fees received in units and lower tax expenses.

Rental Reversion

Rent reversion for the latest quarter is at +3.1%.

Acquisition

MLT announced the proposed acquisition of 8 properties in  Japan, Australia and South Korea, together there is also a potential acquisition of 2 properties in China and a potential divestment of a property in Hong Kong. As of today, the acquisition of 6 properties in Japan is completed.

Divestment

MLT divested 3 Changi South Lan on 31 Mar 2023. The divestment of Chee Wah and Subang 1 is expected to be completed in 1Q FY23/24.

Development

The redevelopment of 51 Benoi Road is targeted to be completed by 1Q 2025.

Related Parties Shareholding

• REIT Sponsor's Shareholding: Above median by 20% or more
• REIT Manager's Shareholding: Below median by 20% or more
• Directors of REIT Manager's Shareholding: Below median by 20% or more

Lease Profile

• Occupancy: ± 5% from median
• Income in SGD/Major Currencies: Below median by 20% or more
• WALE: Below median by 20% or more
• Highest Lease Expiry within 5 Years: Above median by 20% or more; Falls in FY23/24
• Weighted Average Land Lease Expiry: median by 20% or more

Debt Profile

• Gearing Ratio: ± 10% from median
• Gearing including Perps: ± 10% from median
• Cost of Debt: Below median by 20% or more
• Fixed Rate Debt %: Above median by 10% or more
• Unsecured Debt %: ± 10% from median
• WADM: Above median by 20% or more
• Highest Debt Maturity within 5 Years: Below median by 20% or more; Falls in FY26/27
• Interest Coverage Ratio: ± 10% from median

Diversification Profile

• Top Geographical Contribution: Below median by 20% or more
• Top Property Contribution: Below median by 20% or more
• Top 5 Properties' Contribution: Below median by 20% or more
• Top Tenant Contribution: Below median by 20% or more
• Top 10 Tenants' Contribution: Below median by 20% or more

Key Financial Metrics

• Property Yield: ± 10% from median
• Management Fees over Operating Distributable Income: Above median by 20% or more; $4.12 distribution for every dollar paid 
  
• Operating Distributable Income on Capital: ± 10% from median
• Operating Distributable Income Margin: Above median by 10% or more
• Operating Distribution Proportion: Below median by 5% or more

DPU Breakdown

• TTM DPU Breakdown:
• 84.8% from Operation
• 13.2% from Management Fees Paid in Units
• 0.5% from Income Support
• 1.5% from Proceeds from Divestment 

Trends

• Uptrend: DPU from Operation, NAV per Unit
• Flat: Occupancy
• Slighy Downtrend: Operating Distributable Income Margin
• Downtrend: Interest Coverage Ratio, Property Yield, Operating Distributable Income on Capital

Relative Valuation

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

Author's Opinion

Favorable	Less Favorable
High REIT Sponsor's Shareholding	Low REIT Manager's Shareholding
Low Cost of Debt	Low Directors of REIT Manager's Shareholding
High Fixed Rate Debt %	Low Income in SGD/Major Currencies
Long WADM	Short WALE
Well Spread Debt Maturity	Concentrated Lease Expiry
Low Top Geographical Contribution	Short Weighted Average Land Lease Expiry
Low Top Property & Top 5 Properties' Contributions	High Perpetual Securities %
Low Top Tenant & Top 10 Tenants' Contributions	Non Competitive Management Fees
High Operating Distributable Income Margin	Low Operating Distribution Proportion
DPU from Operation Uptrend	Interest Coverage Ratio Downtrend
NAV per Unit Uptrend	Property Yield Downtrend
	Operating Distributable Income on Capital Downtrend

The latest results show that MLT's performance has remained consistent with the previous quarter. There is only 8% of debt requires refinancing in the next 12 months with a high fixed-rate debt proportion at 84%. Additionally, 77% of the distributable amount in the next 12 months is hedged or derived in SGD. With the completed acquisition of 6 properties in Japan, MLT's overall performance is expected to remain stable.

You could also refer below for more information:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and detail of Singapore REIT

REIT Review - List of previous REIT review posts

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*Disclaimer: The information presented on this blog is for educational and informational purposes only. The materials, including research and opinions, are based solely on my own findings and should not be considered as professional financial advice or a definitive statement of fact. I cannot guarantee the accuracy, completeness, or reliability of the information provided. I shall not be held liable for any errors, omissions, or losses that may occur as a result of using the information presented on this blog. It should be noted that the information presented on this blog does not constitute a buy, sell, or hold recommendation for any security. It is crucial to conduct your own thorough research and due diligence before making any investment decisions.