3Q19 revenue dipped 2% to $132.4 million due to the absence of revenue contribution from Ascott Raffles Place Singapore as a result of the divestment.
Gross profit edged up by 1% to $65.0 million in 3Q19, mainly due to the adoption of a new accounting standard.
The manager notes that gross profit for Belgium and Spain jumped 29% and 13% respectively on the back of strong leisure demand, while its properties in Vietnam and the UK also saw higher demand.
About 40% of the gross profit for 3Q19 was contributed by stable income from properties on master leases and properties on management contracts with minimum guaranteed income.
As at end-September, cash and cash equivalents stood at $385.4 million, with its gearing at 33%.
Looking ahead, the manager says the proposed combination of Ascott REIT and Ascendas Hospitality Trust received strong approval of over 99% of the votes from unitholders at the respective extraordinary general meetings and scheme meetings held on Oct 21.
The combined entity, which will continue to be named Ascott Residence Trust, will be world’s eighth largest hospitality trust with an asset value of $7.6 billion.
Subject to relevant approvals, the proposed combination is expected to complete by the end of 2019. The new Ascott REIT-Business Trust stapled units under the combined entity are expected to commence trading on the Singapore Exchange on Jan 2, 2020.
“With a debt headroom of about $1.1 billion, we have the capacity to pursue yield-accretive acquisitions, development and conversion projects,” says Beh Siew Kim, CEO of the manager.
“Post-combination, we will continue to have the mandate to acquire lodging assets in any part of the world. Besides Asia Pacific, we will also keep a lookout for quality assets in Europe and the USA,” she adds. “Post-completion of Ascott REIT’s combination with A-HTRUST, we will review the combined portfolio to assess opportunities for asset enhancements to maximise returns.”
Beh also notes that lyf one-north Singapore, Ascott REIT’s maiden development project and co-living property, is on track to open in 2021.
As at 9.17am, units in Ascott REIT are trading 1 cent lower at $1.41.
