MINT

MINT: 3QFY15 DPU rose 6.4% y/y (+2.7 q/q) to 2.67¢, bringing 9MFY15 DPU to 7.85¢ (+5.9% y/y), slightly ahead of estimates. Distributable income rose 9% y/y (+1.2% q/q) to $46m. NPI rose 5.4% y/y (+3.2% q/q) to $58m, while revenue climbed 3.3% y/y (+0.3% q/q) on positive rental reversions from renewed leases in flatted factories, business park buildings, and stack-up/ramp-up buildings. Newly completed Hi-Tech developments (Toa Payoh North 1, Woodlands Central and K&S Corporate HQ) also contributed to top line. Passing rents rose 1¢ q/q to $1.83 psf/month Occupancy stood at 90.8% (2QFY15: 91.5%) due to the progressive relocation of tenants from the Telok Blangah cluster, which will be redeveloped as a BTS project for Hewlett Packard. Some 69% of existing tenants have committed to alternative MINT clusters. WALE stood at 2.6 years. Aggregate leverage stood at 32.8% with all in funding cost of 2.2%. Assuming a 40% threshold, MINT has debt headroom of $400m. Management have also increased interest rate hedge ratio to 86% from 77% in the quarter via interest rate swaps. The BTS 7-storey data centre Equinix will be completed in 1QCY15, and is now fully committed. Its lease structure comes embedded with annual rental escalation. Meanwhile for the Hewlett-Packard BTS, Phase 1 will be completed in 2H16, while Phase 2 will be completed in 1H17. Mapletree Industrial Trust is currently trading at 1.3x P/B, at 6.76% annualized 3QFY15 yield. Latest broker ratings: Daiwa maintains Outperform with increased TP of $1.68 from $1.65 JP Morgan maintains Neutral with TP of $1.55 Deutsche Bank maintains Hold with TP of $1.48 OCBC maintains Hold with TP of $1.43