Singapore-listed Hospitality REIT Ascott Residence Trust (Ascott REIT) (SGX:A68U) has announced a 14 percent increase in distributable income to S$27.6 million for its 1Q 2013 as compared with the same period a year ago. Distribution per Unit (DPU) for the same quarter rose 5 percent to 2.25 cents.
|Ascott REIT’s serviced residences are operated under the Ascott, Citadines and Somerset brands.|
The rise in distributable income comes on the back of higher revenue and gross profit for China, Japan and Germany as contributions from its newly acquired properties start to kick in.
However overall revenue for the quarter dipped 3 percent due to higher staff costs and lower contributions from its properties in Singapore. Ascott REIT is also reeling from a depreciation of JPY against SGD, dampening the revenues from its Japan properties. The dip in revenue is further exacerbated by the fact that Ascott REIT had divested 2 properties last year - Somerset Grand Cairnhill Singapore and Somerset Gordon Heights Melbourne.
But the REIT fared better with its overseas properties. Revenue in China rose 39 percent due to contribution from the newly acquired Ascott Guangzhou. In Japan, revenue grew by 28 percent mainly due to contribution from Citadines KarasumaGojo Kyoto and overall improved market sentiments in the country. Meanwhile revenue in Germany increased 140 percent and this is mainly due to the contribution from the newly acquired Madison Hamburg.
Looking forward, Ascott REIT plans to bank on accretive acquisitions to spur revenue growth.
"We successfully raised S$150 million through an equity placement which was completed on 6 February 2013. The equity placement increased our financial capacity to fund potential accretive acquisitions and expand Ascott Reit’s portfolio of quality assets", said Mr. Lim Jit Poh, Chairman of Ascott Residence Trust Management Limited.
Units of Ascott REIT are currently trading up by about half a percentage point at S$1.46 on the Singapore Exchange.