Ascendas Hospitality Trust property in Singapore Park Hotel Clarke QuayAscendas Hospitality Trust's property in Singapore, Park Hotel Clarke Quay

Ascendas Hospitality Trust (SGX:Q1P) announced on 28 January that it has posted a 9.5% and 9.3% year-on-year decline in gross revenue and net property income (NPI) respectively for its 3Q FY2015/16.

Gross revenue for the period was SGD54.9 million while NPI was 23.4 million.

The trust has attributed the decline mainly due to loss of income from Pullman Cairns International which was divested in June 2015, lower contribution from Pullman and Mercure Brisbane King George Square and the continual weakening of the AUD against the SGD.

However income available for distribution for the period improved by 17.6% year-on-year to SGD17.0 million due to absence of costs related to the unwinding of a cross currency swap this quarter.

The amount also included of a portion of proceeds from the divestment of the Cairns Hotel, said the trust. Correspondingly distribution per stapled security (DPS) for the period was 1.45 Singapore cents an increase of 11.5% year-on-year.

Performance of the trust’s properties in Australia (except its Brisbane property), China and Japan generally improved during the quarter but income derived from Park Hotel Clarke Quay in Singapore declined, as the hospitality sector in the country continued to face headwinds, it said.

“The overall performance of the portfolio for this quarter was mainly affected by the performance of our hotel in Brisbane, which was, in turn, due to the soft market environment in the city. ”Tan Juay Hiang, CEO of the trust’s manager.
As at 31 December 2015, Ascendas Hospitality Trust’s gearing ratio was at 38.2% with 89.4% of its total borrowings on fixed interest rates. The effective interest rate was 3.4% while weighted average tenor of the borrowings was approximately 2.3 years.

Units of Ascendas Hospitality Trust finished the trading day 1.32% higher than the previous trading day on the Singapore Exchange to end at SGD0.765.

By Ridzwan Rahmat

Ridzwan has been analysing REITs and business trusts since 2008, and personally manages a portfolio comprising mainly of SGX-listed REITs. He founded REITsWeek in 2013.