FCOT

FCOT: 4Q12 results strong, in line. DPU was up 15% yoy on the acq of an additional stake in Caroline Chisholm and lower interest costs on refinancing. FCOT also surprised positively on good leasing, with 76% of the space left by Marsh & McLennan having been re-leased, with Group M signing a 6 yr lease commencing from 1 Apr ’13. CIMB believes rental reversion is likely positive on effective rents of $7 psf. Alongside the results, mgt announced its successful exit of the Japan mkt with the divestment of assets at a $18m gain. CIMB views positively mgt’s ongoing rationalization of non-core invmts for increased focus on growth in Spore and Australia. In addition, FCOT announced that wef 1QFYSep13, it will make distributions on a quarterly basis. This will bring its payout frequency inline with the rest of its peers. The final semi-annual distribution will be for the period 1 Apr - 30 Sep 2012. CIMB maintains at Outperform, raises TP to $1.37 from $1.21. FCOT continues to charge to new multi year highs at $1.205, +0.4%.