Sasseur REIT's 2H FY24 Result Review

Basic Profile & Key Statistics

Key Indicators

Performance Highlight

In SGD terms, EMA rental income remained stable YoY. However, distributable income increased due to lower finance and tax expenses despite a reduction in management fees payable in units. DPU remained similar due to higher retention.

Sales

For FY24, portfolio sales declined by 3.9% YoY, impacted by cautious consumer spending, shifts in demand for international brands, and external factors such as extreme weather. However, sales rebounded by 4.8% YoY in 4Q, driven by strong October Golden Week sales and year-end promotions.

Asset Enhancement Initiatives

AEIs for the Kunming and Hefei outlets were completed. Additionally, an energy-efficient air-conditioning system will be installed at Chongqing Liangjiang Outlet between 2025 and 2027 to enhance energy efficiency.

Related Parties Shareholding

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

Lease Profile

• Committed Occupancy: Favorable
• Income Received in SGD/Major Currencies: Less Favorable
• Highest Annual Lease Expiry in 4 Years: Less Favorable
• WALE: Less Favorable
• Weighted Average Land Lease Expiry: Less Favorable

Debt Profile

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

Diversification Profile

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

Key Financial Metrics

• Property Yield: Favorable
• Operating Distributable Income over Manager's Fees: Favorable
• Operating Distributable Income on Capital: Favorable
• Operating Distributable Income Margin: Favorable
• Operating Distribution Proportion: Favorable

DPU Breakdown

• TTM Distribution Breakdown:
• 83.1% from Operation
• 8% from Management Fees Paid in Units
• 8.9% being Retained 

Trends (Up to 10 Years)

• Uptrend: Adjusted Interest Coverage Ratio, Operating Distributable Income on Capital, Operating Distribution Proportion
• Slight Uptrend: DPU from Operations, Committed Occupancy, Operating Distributable Income Margin
• Flat: NAV per Unit, Top 5 Properties' Weightage, Property Yield, Operating Distributable Income over Manager's Fees
• Slight Downtrend: None
• Downtrend: Top 10 Tenants' Weightage

Price Range & Relative Valuation Metrics

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

Author's Opinion

Compared to the previous half-year, EMA rental income remained stable. However, distributable income and DPU declined, mainly due to higher tax expenses. On the debt front, there is no refinancing requirement in 2025.

For more information, check out:

S-REITs Dashboard - Detailed information on individual Singapore REIT

S-REITs Data - Overview and detail of Singapore REITs

S-REIT Comparison - Comparison among Singapore REITs

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.