GLP

GLP: Announced 4Q11 results which were within expectations, rev at US$124.4m, +17% yoy and flat qoq, while net profit at US$49.2m, -63% yoy and -40% qoq. Plunge in yoy net profit largely due to a US$100.2m fair value gains in FY10, vs a fair value loss of US$8.9m that was incurred this time round. Excluding revaluation gains, core net profit at US$59.8m, +13.5% yoy and -18.5% qoq....

Growth driven by completion and stabilization of GLP’s development projects in China, improved operational performance of properties in China and Japan and translation gains arising from the strengthening of Yen vs USD, while lease ratios in China and Japan remain high at 92% and 99% respectively....

Result brings FY11 rev to US$473.9m, +14.6% yoy while core net profit at US$279m, +56.3% yoy. Going forward, grp remains confident of growth in Asia’s logistic market and will ride wave of consumption growth in China, while in Japan, remain bullish on the country’s outlook as demand for high quality modern logistic facilities will surge as the country accelerates its rebuilding programs....

We note that at current price, valuation appears undemanding, with grp trading at 1.12x P/B vs peers Hang Lung properties of 1.33x and CMA at 1.1x, while net gearing at a comfortable 30.5%, giving head room for further debt acquisitions. JP Morgan remains O/w and increases TP to $3.00 from $2.90, while Nomura maintains Buy, with TP $2.57.