CapitaCommercial Trust: Announced 4Q11 results this morning which was in-line, albeit at the lower end. 4Q NPI at $68.3m, -3.6% yoy and -1.3% qoq while DPU at 1.92c, -1% yoy and 5% qoq. Results brings FY11 NPI to $277.3m, -7.2% yoy and DPU to 7.52c, -4% yoy.
Drop in NPI and DPU mainly due to lack of income contribution after sales of Robinson Point and StarHub Centre in 2010 and redevelopment of Market Street Car Park. Other reasons are lower occupancy rate and signing office rents being lower than expired rents in 2011. Nonetheless, the increase in rental income from Raffles City, together with the lower property tax payment for the portfolio and interest savings moderated the decline in income.
Going forward, grp remains confident of outlook, while we note that grp’s fundamentals remain sound with a low gearing ratio of 30.2%, with interest coverage at 4.1x, while grp’s total portfolio occupancy levels stood at 97.2%, with Wale for its top 10 tenants standing at a comfortable 4.5 yrs. At current price, valuation appears compelling, with grp trading at 0.71x P/B and FY11 yield of 6.7%.
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