ARA Asset Management

ARA Asset Management: 2Q12 results in line. ARA’s reported 2Q12 net profit of $15.4m (+4% yoy), bringing 1H12 net profit to $35.3m (+20%). Earnings were largely recurrent in nature, with higher REIT and portfolio management fees coming from higher valuations of its REIT AUM, coupled with new contributions from completed acquisitions for Cache and Fortune REIT. The group also accrued portfolio management fees receivable from ADF11 upon commencement of its investment period in March 12. Higher operational costs from higher staff related expenses, in line with expanding business operations, led to a slight decline in margins to 60.2%. ARA proposed an interim DPS of 2.3c, in line with previous years. Ratings as follow: DBSV maintains Buy with $1.72 TP.