SG Market (25 Jul 17)

MARKET OVERVIEW
- The market will remain range-bound ahead of a slew of results from several blue-chips in later part of the week.
- Oil-related counters may get a lift from firmer oil prices after oil producers called for stricter adherence to output cuts, which included Nigeria, at a Russian meeting.
- Technically, the STI is overbought and could pull back to underlying support at 3,275. Topside resistance is at 3,360.

CORPORATE RESULTS
*Mapletree Logistics Trust
- 1QFY18 DPU grew 2% to 1.887¢, meeting expectations.
- Revenue and NPI rose 7% and 7.5% to $95.8m and $80.8m from stronger performance of its Singapore and HK portfolios and accretive acquisitions completed last year.
- Out of 157,900 sqm of leases due for expiry, 93% were successfully renewed during the quarter.
- Occupancy stood at 95.5% (-0.8ppts q/q) with WALE of 3.9 years, while aggregate leverage inched up 0.5ppt q/q to 39%.
- Trades at 1Q annualised yield of 6.2% and 1.2x P/B.

*Frasers Centrepoint Trust
- 3QFY17 DPU fell 1.3% to 3¢ (-1.3%), in line with estimates.
- The 3.3% drop in revenue to $43.6m was dragged by ongoing refurbishment work at Northpoint mall and challenging retail environment, while NPI slipped 1.3% to $30.8m on lower property expenses (-7.8%).
- Occupancy was flat at 87.1% (-0.1ppt q/q), while aggregate leverage stood at 30% (+0.6ppts q/q).
- Trades at 3Q annualised yield of 5.6% and 1.1x P/B.

*Frasers Commercial Trust
- Flat 3QFY17 DPU of 2.4¢ was in line with estimates.
- Both revenue and NPI dipped 0.6% and 0.8% to $38.3m and $27.9m, respectively, owing to lower occupancy at Alexandra Technopark (under renovation) and China Square Central in Singapore but its three Australian properties put up a better showing from the stronger AUD.
- Portfolio occupancy improved to 92.6% (+0.8ppt q/q), while aggregate leverage held steady at 35.9%.
- Trades at 3Q annualised yield of 6.7% and 0.94x P/B.

*Parkway Life REIT
- 2Q17 DPU of 3.32¢ (+10.3%) included a 0.22¢ capital distribution on divestment gains and was in line with estimates.
- Gross revenue and NPI improved to $27.7m (+1.1%) and $25.9m (+1.4%) on higher rentals from its Singapore properties, although income from its Japanese portfolio was eroded JPY depreciation.
- Aggregate leverage rose 1.1ppt to 37.4%.
- Trades at 2Q annualised yield of 5% and 1.55x P/B.

*Vard
- 2Q17 net loss widened to NOK69m (2Q16: NOK53m) dragging 1H17 loss to $94m (+488%), forming 70% of full year estimate.
- Revenue slipped 4% to NOK2.13b on reduced activity, especially at the Norwegian yards, as well as cessation of operations in Vard Niterói in 3Q16.
- EBITDA margin improved to 2.8% from 0.5% last year.
- Order book stood at NOK12.88b (1Q17: NOK12.98b).
- NAV/share at $0.31.

*Great Eastern
- 2Q17 net profit surged 173% to $279.5m, boosted by profit from life assurance of $240.4m (+123%). This brought 1H17 earnings to $497.4m or 69% of full year estimate.
- In the quarter, total weighted new sales rose 6% to $255.7m, underpinned by continued growth in SG and MY.
- New business embedded value grew 17% to $121.1m with higher margin of 47.4% (2Q16: 42.7%, 1Q17: 36.5%).
- NAV/share at $14.80

POSITIVE NEWS
*Frasers Centrepoint
- Developing $190m new commercial facilities in The Key Industrial Park in the South East and West Park Industrial Estate in Melbourne.
- Six tenants have committed 10-year leases at the two properties.

*First Resources
- 2Q17 FFB harvest improved 15% to 613,597 tonnes, with yield rising 0.1ppt to 3.5 tonnes/ha.
- CPO production rose 13.6% to 143,777 tonnes, despite a dip in extraction rate to 22.2% (-0.3ppt).
- MKE last had a Hold with TP of $1.97.

*Lian Beng/KSH
- 80:20 JVCo Goldprime Realty is divesting 596 St Kilda Road in Melbourne for A$34m.
- The freehold property with 19 housing units sits on land area of 1,803.6 sqm.

*UnUsUaL
- Appointed by IMC Live Group China to co-promote Angela Chang's world tour between Sep '17 and Jan '18.
- This will take it to 10 cities in Beijing, Xian, Dalian, Guiyang, Suzhou, Kunming, Nanchang, Xiamen, Shenzhen and Kuala Lumpur.

*AsiaPhos
- Management expects higher 2Q17 revenue and net profit due to higher sales volume and ASP of phosphorus, following resumption of full production in the quarter.
- 2Q17 results slated to be released on or before 14 Aug '17.

*Sapphire
- Secured three new infrastructure contracts worth Rmb308m in China, lifting order book to Rmb2.6b.
- The contracts are mainly expected to be fulfilled over the next 36 months, with the exception of one that is due by end '21.

*Alliance Mineral
- Obtained all environmental approvals required to construct and operate a 1.2mtpa dense media separation plant at Bald Hill Mine in Western Australia.
- The approvals also allow for mining and processing of lithium and tantalum to commence at Bald Hill.