Frasers Hospitality Trust's Hotel Intercontinental Singapore.Frasers Hospitality Trust's Hotel Intercontinental Singapore.

Frasers Hospitality Trust (SGX:Q5T) announced on 28 January that it has achieved a distribution per stapled security (DPS) of 1.72 Singapore cents for its 1Q 2016, an increase of 7.5% from the 1.60 cents posted in the corresponding period in 2015.

This was on the back of a 23.2% increase in distributable income for the period that came in at SGD23.7 miillion.

Correspondingly gross revenue and net property income (NPI) for the quarter both increased by 16.2% and 16.9% to SGD31.4 million and SGD26.3 million respectively. The trust has attributed this mainly to the performances of its Japan and Australia properties.

“Our properties in Japan and Sydney continue to see high growth and with a well-diversified portfolio, we are better placed to ride out challenges in other weaker markets, said Eu Chin Fen, CEO of the manager for Frasers Hospitality Trust’s REIT component. “The strong contribution of Sofitel Sydney Wentworth acquired in July 2015 showed the value of the acquisition to the existing portfolio”, she added.

Its Kuala Lumpur property, The Westin Kuala Lumpur, also saw a 5.3% and 3.8% increase in gross revenue and NPI respectively.

However gross revenue and NPI of its Singapore portfolio were 16.5% and 19.5% lower than 1Q FY2015 respectively due to the on-going asset enhancement initiatives at Intercontinental Singapore which commenced in April 2015. The trust’s United Kingdom properties also recorded a decline in gross revenue and NPI by 8.3% and 9.8% respectively due to seasonality issues which were further exacerbated by the Paris attacks in mid-November 2015.

As at 31 December 2015, Frasers Hospitality Trust’s gearing is at 38.8% while total debt stood at SGD791.7 million. Fixed-rate debt has increased to 87.9% from 73.0% of total debt as at 30 September 2015.

Units of Frasers Hospitality Trust finished 0.8% lower from its previous close on the Singapore Exchange to end at SGD0.63.

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.