Frasers Centrepoint Trust achieves record DPU of 2.35 cents in Q4 2011

Credits go to Causeway Point which lifted FCT’s net income to $82.6 m in FY 2011.

In a release, Frasers Centrepoint Asset Management Ltd., the manager of Frasers Centrepoint Trust, is pleased to announce distribution per unit of 2.35 cents for the period 1 July to 30 September 2011 (“4Q11”), a 8.8% year-onyear increase compared to the 4Q10 DPU of 2.16 cents. The 4Q11 DPU is also the highest ever quarterly DPU to be paid out by FCT. This brings the total DPU for the financial year ended 30 Sep 2011 (“FY2011”) to a record 8.32 cents and it represents the fifth consecutive year of DPU growth since FCT’s listing.

FCT achieved a solid performance for FY2011 on the back of a strong 4Q11 performance upswing from its largest asset Causeway Point, which lifted FCT’s FY2011 gross revenue  and net property income (“NPI”) to $117.9 million and $82.6 million, respectively.

Causeway Point posted a strong quarterly performance in 4Q11, following the re-opening of the refurbished sections at the basement, levels one and two of the mall. The mall’s 4Q11 revenue of $17.3 million was 61.7% higher than the preceding quarter. Similarly, its NPI for  the quarter improved 95.6% over 3Q11 to $13.3 million.

The refurbishment of Causeway Point continues to proceed on schedule, with full completion expected in December 2012. As at 30 September 2011, 65.5% of the refurbishment works have been completed. The focus of the next phase of the refurbishment will shift to the higher levels of the mall where any disruption to revenue will be more muted.

FCT’s portfolio occupancy as at 30 September 2011 stood at a healthy 95.1%. This is a 7.5%-point improvement compared to 87.6% as at 30 June 2011. This is attributed to the sharp recovery in occupancy at Causeway Point to 92.0%, up from 78.3% in the previous quarter. The average rental rate for renewal leases signed in FY2011 was 8.6% higher than the preceding leases. This is 1.4%-point higher than the 7.2% average rental reversion achieved in FY2010 and it reflects robust lease renewal interest at FCT’s malls.

FCT’s financial position remains healthy with a gearing of 31.3% as at 30 September 2011 and an interest cover of 4.62 times for 4Q11. Following the refinancing of FCT’s $260 million 4.12% p.a. CMBS on 5 July 2011 with a 5-year secured bank borrowing at a lower effective interest cost, FCT’s average cost of debt was reduced by 75 basis points to 3.01% as at 30 September 2011.

Total assets of FCT grew 17.9% y-on-y to $1,787 million as at 30 September 2011, on higher property valuation and the acquisition of Bedok Point. FCT recognised revaluation surplus of $97.2 million (after adjustments) on its portfolio in FY2011, with Causeway Point contributing the largest proportion of the revaluation surplus of $59.2 million.

Dr Chew Tuan Chiong, CEO of FCAM, said, “We are delighted that FCT has delivered another solid set of results. Particularly satisfying to us is that FCT continue to deliver higher returns while navigating the complex process of upgrading its flagship Causeway Point.”

Dr Chew added, “We made significant progress on all fronts of our growth strategies which lay the foundation for further growth. The newly-acquired Bedok Point will add $7 million to our NPI and the rejuvenated Causeway Point is expected to provide further uplift to NPI growth.”