Croesus Retail Trust

Croesus Retail Trust: Maiden results for the period since listing (10 May) till 30 Sep exceeded IPO forecast. The extended 1QFY13 period (143 days) recorded distributable income of ¥1.1b (+8.3%) and DPU of 3.26Scts (+4.6%), mainly due to property tax rebates and a decrease in income tax. Despite the impact of Typhoon Man-yi that hit Japan in Sep, as well as a colder Jul season resulting in lower sales of summer-season products, gross revenue of ¥2.0b came in line with forecast. Meanwhile, NPI of ¥1.3b was 3.1% ahead due to 4% lower than expected property expenses. Portfolio occupancy is high at 99.9%. With a relatively high gearing level of 42.3%, Croesus have little debt headroom to tap on. Meanwhile, there could be a potential of a fund raising, with the group actively on the lookout for high quality acquisitions. Management sees a healthy level of consumer activity, as well as encouraging macroeconomic indicators, showing promising signs of optimism and confidence in the Japanese economy. At $0.875, Croesus trades at a 4% discount to its NAV of ¥72.4 (S$0.909).