Sasseur REIT's 4Q FY23 Result Review

Basic Profile & Key Statistics

Key Indicators

Performance Highlight

EMA rental income (SGD) saw significant yearly improvement, primarily driven by higher variable components from increased sales. Distributable income and DPU have also improved, although to a lesser extent than the EMA rental increase, mainly due to higher tax expenses.

Sales

Sales has increased for both YoY and QoQ.

Asset Enhancement Initiatives

AEI for Hefei Outlet has been completed, and the new supermarket opened in January.

The second entrance work for Bishan Outlet was completed ahead of schedule in December 2023.

Related Parties Shareholding

The REIT sponsor, REIT manager, and directors of the REIT manager hold a relatively high proportion of shareholding.

Lease Profile

All income is received in RMB. WALE is short with concentrated lease expiry. Additionally, the weighted average land lease expiry is also short.

Debt Profile

The debt profile presents a mixed picture. On the positive side, there is a low gearing ratio, high adjusted interest coverage ratio, and a relatively high proportion of fixed-rate debt. However, the cost of debt is high, and debt maturity is concentrated. Additionally, the proportion of unsecured debt is low.

Diversification Profile

The portfolio features diversified tenants, but income contributions from properties are concentrated.

Key Financial Metrics

Key financial metrics are favorable, with high property yield, operating distributable income on capital, and operating distributable income margin. Additionally, the management fee is low compared to operating distributable income.

DPU Breakdown

• TTM Distributable Income Breakdown:
• 89.2% from Operation
• 10.8% from Management Fees Paid in Units
• TTM DPU = 92.8% of Distributable Income

Trends

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

Relative Valuation

• Dividend Yield - Average for 1y, 3y & 5y
• P/NAV - Average for 1y, 3y & 5y

Author's Opinion

As compared to the previous quarter, income and distributable income has improved. However, DPU is lower due to S$ 3.05 mil retained amount in 4Q vs no amount retained in 3Q. For debt, there is no refinancing requirement until March 2025.

For more information, check out:

SREITs Dashboard - Detailed information on individual Singapore REIT

SREITs Data - Overview and details 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 findings and should not be considered 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.