Frasers Centrepoint Trust (FCT) announced a distribution per unit (DPU) of 6.054 cents for 1HFY2025, for the six months from October 1, 2024 to March 31, up 0.5% y-o-y.
Revenue in 1HFY2025 rose 7.1% y-o-y to $184.4 million and net property income (NPI) was 7.3% higher at $133.7 million, driven by higher rental income from renewed and new leases signed. Distribution to unitholders was 4.9% higher y-o-y, mainly due to higher NPI, full six-month contribution from the acquisition of an additional 24.5% interest in NEX, and better performance from Waterway Point and NEX.
On the capital management front, FCT's aggregate leverage fell to 38.6% as at March 31 compared with 39.3% as of Dec 31, 2024. The average cost of borrowing for 1HFY2025 was 3.9%, a decline from 4.0% in 1QFY2025. Interest coverage ratio as at March 31 stood at 3.28 times down marginally from the 3.33% as of Dec 31, 2024. ICR is calculated on a 12-month trailing basis, less distributions to perpetual securityholders. FCT does not have any perpetual securities, and derives its income mainly from suburban Singapore malls, making it one of the safest S-REITs.
In a statement, FCT's manager says it expects interest rate movements and an increase in operating expenses to remain the key factors that may affect FCT's performance. FCT's average cost of borrowings should remain below 4% for the second half of FY2025. The manager will continue to drive cost optimisation initiatives for its operations and adopt appropriate hedging strategies for energy contracts to mitigate the impact on its expenses on utilities, it said in its statement.
In March, FCT announced the proposed acquisition of Northpoint City South Wing for $1.17 billion. "The proposed acquisition is a strategic progress for FCT as it strengthens FCT's position as Singapore's leading prime suburban retail space owner and further enhances the quality of FCT's retail portfolio. Through a successful private placement and preferential offering, we raised about $421.3 million. This will fuel our next phase of growth," says Richard Ng, CEO of FCT's manager.
FCT closed at $2.25 on April 28. Its annualised FY2025 DPU translates into a yield of 5.38%.
