Fraser Centrepoint Trust (FCT):

Fraser Centrepoint Trust (FCT): 2QFYSep12 results in line. Income available for distribution of $21.3m, +8% qoq, +31% yoy. DPU of 2.5cts, +14% qoq, +21% yoy. This is the highest quarterly distribution for FCT, and makes the first time that income to be distributed has surpassed $20m. Results boosted by the group’s new acq of Bedok Point, as well as partial contribution from Causeway Point, where asset enhancement (AEI) works are ongoing. FCT continued to achieve healthy rental reversions of 11% in 1H12. The group has remaining 10.4% of leases due for expiry in 2H12. Portfolio occupancy declined to 93.5% from 97.5%, as AEI works continue in Causeway Point and the temporary closure of Northpoint’s food court. AEI in Causeway Point is on track for full completion in Dec ’12, with 91% of space pre-committed. Gearing remains unchg at a conservative 30.9%. FCT has debt headroom of $273m before reaching a gearing of 40%. Avg cost of borrowing is down 2bp to 3.04%. CIMB maintains Outperform, raises TP to $1.75 from $1.65. UOBK keeps at Buy, raises TP to $1.80 from $1.75. BOA-ML reiterates Buy with TP $1.70. Likes the seucre div yield of 6.2%. Tips potential upside to forecasts when FCT acquires Changi City Point from its sponsor (est FY13).