AIMS APAC REIT's 1H FY25 Result Review

Basic Profile & Key Statistics

Key Indicators

Performance Highlight

Gross revenue, NPI and distributions to unitholders improved YoY, driven by rental growth across portfolios and income from the sale of electricity and renewable energy certificates generated from the rooftop solar photovoltaic systems at 6 Singapore properties. On the other hand, DPU remains similar due to the enlarged unitholder base from the mid-2023 equity fundraising.

Rental Reversion

Rental reversion for 1Q and 2Q is 12.8% and 23.9% respectively.

Asset Enhancement Initiatives

There are 2 ongoing AEIs, which are targeted to be completed by 1Q FY 2026.

There are also ongoing upgrades related to ESG, including toilet upgrading, installation of energy-effective fittings, etc.

Related Parties Shareholding

• REIT Sponsor's Shareholding: Less Favorable
• REIT Manager's Shareholding: Favorable
• Directors of REIT Manager's Shareholding: Favorable

Lease Profile

• Occupancy: Moderate
• WALE: Less Favorable
• Highest Lease Expiry in 4 Years: Moderate
• Weighted Average Land Lease Expiry: Less Favorable

Debt Profile

• Gearing Ratio: Favorable
• Cost of Debt: Moderate
• Fixed Rate Debt %: Moderate
• Unsecured Debt %: Less Favorable
• WADM: Moderate 
• Highest Debt Maturity in 4 Years: Less Favorable
• Interest Coverage Ratio: Moderate

Diversification Profile

• Top Sector Contribution: Favorable
• Top Geographical Contribution: Less Favorable
• Top Property Contribution: Favorable
• Top 5 Properties' Contribution: Moderate
• Top Tenant Contribution: Less Favorable
• Top 10 Tenants' Contribution: Less Favorable

Key Financial Metrics

• Property Yield: Favorable
• Management Fees over Operating Distributable Income: Moderate
• Operating Distributable Income on Capital: Moderate
• Operating Distributable Income Margin: Moderate
• Operating Distribution Proportion: Moderate

DPU Breakdown

• TTM Distribution Breakdown:
• 93.2% from Operation
• 5.8% from Management Fees Paid in Units
• 1.1% being Retained

Trends (Up to 10 Years)

• Uptrend: Committed Occupancy
• Slight Downtrend: Property Yield, Operating Distribution Proportion
• Downtrend: DPU from Operation, NAV per Unit, Adjusted Interest Coverage Ratio, Operating Distributable Income over Manager's Fees, Operating Distributable Income on Capital, Operating Distributable Income Margin

Price Range & Relative Valuation Metrics

• Dividend Yield: Average for 1y, 3y, 5y & 10y
• P/NAV: Average for 1y, 3y, 5y & 10y

Author's Opinion

As compared to the previous half-yearly, there is a slight decline in DPU despite improvement in gross revenue and NPI. For debt, $100 medium-term notes will be maturing in November and AAREIT has adequate financial flexibility to redeem the notes.

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.