Croesus Retail Trust's seventh property in Japan, One's Mall in Chiba Prefecture.Croesus Retail Trust's seventh property in Japan, One's Mall in Chiba Prefecture.

Singapore-listed Croesus Retail Trust (SGX:S6NU) announced on 11 February that it has achieved a distribution per unit (DPU) of 1.79 Singapore cents for its 2Q 2016.

When compared to the restated 2Q FY2015 DPU of 1.70 cents, DPU for 2Q FY2016 represents an increase of 5.3%. “The restated 2Q FY2015 DPU accounts for an enlarged unit base for Croesus Retail Trust, taking into consideration the 114,222,677 units that were added to its unit base on 2 November 2015, pursuant to the rights issue”, said the trust.

Without the restatement, the DPU would have been a decrease of 13.94%.

The figures came on the back of a 24.7% increase in gross revenue that was recorded at JPY 2,434 million (SGD30.4 million). The trust has attributed the increase mainly to the acquisitions of One’s Mall and Torius in October 2014 and October 2015 respectively, and the tenant renewal exercise at Mallage Shobu.

“Whilst our DPU for the second quarter came in lower than what was stated for the previous corresponding period, our distributable income rose by a healthy 11.3%”, said Jim Chang, CEO of the trust’s manager.

“Adjusting for the same unit base for both quarters, unitholders who have subscribed for their entitlements at the rights issue would receive a higher total distribution amount from us for 2Q FY 2016”, he added.

Aggregate portfolio occupancy as at 31 December 2015 was at 98.1% with four malls out of eight recording 100% occupancy while weighted average lease expiry (WALE) by net lettable area was at 8.0 years.

Croesus Retail Trust’s gearing ratio as at 31 December 2015 was at 46.3%, down from the 47.3% as at 30 June 2015.

“The lower interest rates in Japan would create an enhanced lending environment, which would help corporates attain financing”, said Jeremy Yong, group managing director of the trust’s sponsor. “For Croesus Retail Trust, this bodes well for us as we can seek to refinance our loans at more attractive rates, thereby passing on any cost savings to our unitholders”, he added.

Units of Croesus Retail Trust last changed hands on the Singapore Exchange at SGD0.80.

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.