• Contributions from PGIM Real Estate AsiaRetail Fund Limited (“PGIM ARF”) and Sapphire Star Trust (“SST”) lifted distribution to Unitholders by 22.1%
• Achieved positive rental reversion of 5.0% for leases renewed in 1Q20

SINGAPORE, 22 JANUARY 2020

Frasers Centrepoint Asset Management Ltd. (“FCAM”), the manager of Frasers Centrepoint Trust (“FCT” or the “Trust”), is pleased to announce distribution per unit (“DPU”) of 3.06 Singapore cents for the period from 1 October to 31 December 2019 (“1Q20”), up 1.3% year-on-year (“y-o-y”).

FCT Unitholders (“Unitholders”) can expect to receive their DPU for 1Q20 on 28 February 2020. The ExDate is 30 January 2020 and the Books Closure Date is 31 January 2020.

Mr Richard Ng, Chief Executive Officer of FCAM, said, “We are pleased that FCT has delivered another quarter of steady performance and a higher DPU for 1Q20. The portfolio has achieved higher average occupancy and rental growth from new leases signed and renewed leases to underpin the growth in revenue and net property income (“NPI”). The distributable income is also boosted by contributions from our investments in PGIM ARF and SST which holds the interest in Waterway Point. We will continue to focus on optimising FCT’s portfolio and its performance, and to deliver stable returns to our Unitholders.”

Summary of 1Q20 results

FCT portfolio continues to deliver steady performance

Gross revenue for 1Q20 was S$49.8 million, up 1.0% y-o-y and NPI rose 2.6% to S$36.3 million. NPI margin for 1Q20 improved 1.2 percentage-point to 73.0% from the same period last year. Gross revenue growth was supported by higher overall portfolio occupancy and rental growth from renewals and replacement leases which commenced during the quarter.

Income available for distribution for 1Q20 rose 26.5% to S$35.0 million, due mainly to contributions from FCT’s 24.8% interest in PGIM ARF and 40.0% interest in SST. The distribution from PGIM ARF was S$4.12 million and the amount from SST was S$3.63 million. Distribution to Unitholders for 1Q20 was up 22.1% y-o-y to S$34.2 million.

Financial position remains strong

FCT’s financial position remains strong with gearing level at 33.2%³ as at 31 December 2019. The all-in cost of borrowing in 1Q20 was 2.57%, down from 2.63% in the previous quarter. The weighted average debt maturity was 2.5 years and FCT has approximately 53% of its borrowings on fixed or hedged-to-fixed interest rates.

Improved portfolio occupancy and positive rental reversion

During 1Q20, a total of 60 leases accounting for 142,103 square feet of net lettable area (“NLA”) were renewed at an average portfolio rental reversion of +5.0%. All properties registered positive rental reversions ranging between 2.7% and 7.1%.

The portfolio occupancy as at 31 December 2019 was 97.3%, an improvement of 1.1%-point y-o-y and 0.8%-point over the previous quarter. Occupancy at Causeway Point improved to 97.8% from 97.0% in previous quarter after the completion of the asset enhancement works relating to the underground pedestrian link in December 2019. Anchorpoint registered a strong recovery in its occupancy to 93.5% from 79.0% in the previous quarter after the commencement of trading of the new anchor tenant in November 2019.

Overall portfolio shopper traffic was up 8.4% y-o-y, due mainly to strong traffic increase at Northpoint City and higher traffic registered in most of the properties in the portfolio. The portfolio tenants’ sales for the three-month period from September to November 2019 was flat compared with the same period last year.

Outlook

The Ministry of Trade and Industry (“MTI”) announced on 2 January 2020⁴ that the Singapore economy grew by 0.7% for the year 2019. MTI has announced earlier on 21 November 2019⁵, that it expects the Singapore economy to pick up modestly in 2020 and it expects the economy to grow by 0.5% to 2.5% in 2020.

The Department of Statistics reported that the Retail Sales Index excluding motor vehicles (“RSI ex-auto”) in November 2019 was 0.6% lower y-o-y but 1.0% higher month-on-month. It is noted that the RSI ex-auto index for November 2019 was at 100.9, the first time it rose above the base of 100 since January 2019.

FCT’s property portfolio consists of seven quality suburban retail properties in Singapore, i.e., Causeway Point, Northpoint City North Wing and Yishun 10 Retail Podium, Anchorpoint, YewTee Point, Bedok Point, Changi City Point and Waterway Point (40% interest). These properties are located in populous residential precincts and they are well-connected to the public transportation system. The malls offer a wide range of products and services as well as diverse dining options which cater to the shoppers’ needs and enhance shopper convenience. The malls enjoy high occupancy and steady shopper traffic which underpin the stability of FCT’s portfolio performance.

¹ Includes dividends from PGIM ARF: S$4.121 million and SST: S$3.636 million (this amount excludes interest income of S$0.725 million from SST) (1Q19: nil)

² As at 31 December 2019 for 1Q20 and 31 December 2018 for 1Q19.

³ In accordance with Property Funds Appendix, the gearing ratio included FCT’s proportionate share of deposited property value and borrowings in SST.

⁴ https://www.mti.gov.sg/Newsroom/Press-Releases/2020/01/Singapore-GDP-Grew-by-0_8-Per-Cent-in-the-Fourth-Quarter-of-2019

⁵ Source: https://www.mti.gov.sg/Newsroom/Press-Releases/2019/11/MTI-Forecasts-GDP-to-Grow-by-0_5-to-1_0-Per-Cent-in-2019-and-0_5-to-2_5-Per-Cent-in-2020