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Sasseur REIT 1H 2020 DPU Down 12.8%

Sasseur REIT 1H 2020 DPU Down 12.8%

August 14, 2020 — Sasseur Asset Management Pte. Ltd. announced that Sasseur REIT’s portfolio of four outlet malls in China has delivered higher 2Q 2020 sales, rental income and distributable income as compared to 1Q 2020, showing positive signs that business recovery is firmly underway across its portfolio.

The ongoing COVID-19 pandemic has impacted the economic conditions and consumer sentiment in China, particularly in the 1Q 2020 where the outbreak was most severe in China. By implementing prudent and effective control measures, China has effectively brought the infection cases under control in April 2020. Although there were new COVID-19 infection cases discovered, the authorities were quick to take action to control the spread of the virus. The robust measures are important and will speed up the economic recovery in China.

Riding on the recovery, Sasseur REIT’s outlet malls located in Chongqing, Hefei, Kunming and Bishan generated combined sales of RMB 835.7 million in the quarter ended 30 June 2020 (“2Q 2020”), which is just 18.6% lower than the same period last year (“2Q 2019”), comparing favourably with other retail businesses hit by the pandemic. The figure is also 56% higher than the combined sales of RMB 534.5 million in 1Q 2020, representing a significant and quick recovery in the business.

EMA Rental Income for this quarter recorded a slight decrease of 3.5% year-on-year from RMB 146.0 million in 2Q 2019 to RMB 140.9 million in 2Q 2020, mitigated by the higher fixed component of RMB 102.4 million, which grew 3.9% y-o-y, while the variable component increased by 55% from 1Q 2020 to RMB 38.5 million due to higher sales recorded in 2Q 2020. Overall, EMA Rental Income in 2Q 2020 is 10.8% higher than the RMB 127.2 million recorded in 1Q 2020.

Sasseur REIT maintains a 100% payout of distributable income in 2Q 2020 and deliver DPU of 1.512 cents, which is 13.3% higher than the 1.334 cents DPU for 1Q 2020, bringing a total DPU of 2.846 cents for the first 6 months of 2020.

Overall portfolio occupancy of 93.6% for 2Q 2020 showed slight decrease compared to 1Q 2020, which is mainly due to the decrease of occupancy rate of Bishan Outlets, as a result of impact of the virus. Sasseur team continues to work closely with all mall tenants to attract more customers and drive up sales during this period of recovery. Despite the temporary mall closure and movement restrictions implemented at the beginning of 2020, the intensified marketing and customer engagement efforts implemented by the entrusted manager have helped to drive a 14.1% rise in total VIP membership to 1.8 million as at 30 Jun 2020, as compared to the end of 2019.

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