All 4 Mapletree REITs will be releasing its second quarter results ended 30 September 2021 over the course of the week – with Mapletree Logistics Trust being the first to do so yesterday evening, followed by Mapletree Industrial Trust after market hours today, Mapletree Commercial Trust tomorrow (27 October), and finally, Mapletree North Asia Commercial Trust on Thursday (28 October.) As I’m invested in all four of them, I’ll be doing a review of each of them as and when their results are released.

Today, my focus is on the blue-chip logistics REIT – as at 30 September 2021, its has a total of S$10.78 billion of assets under management, and its portfolio consists of 163 properties in 9 geographical locations – 52 in Singapore, 9 in Hong Kong, 30 in China, 18 in Japan, 18 in South Korea, 12 in Australia, 15 in Malaysia, 7 in Vietnam, and 2 in India.

In this post, you’ll read about my review (along with my personal thoughts to share) about the logistics REIT’s latest set of financial results, its portfolio occupancy and debt profile, as well as distribution payouts declared for the current quarter under review.

Let’s begin…

Financial Performance (Q2 FY2020/21 vs. Q2 FY2021/22, and 1H FY2020/21 vs. 1H FY2021/22)

In this section, I’ll first be looking at the blue-chip logistics REIT’s results on a q-o-q basis (i.e. Q2 FY2020/21 vs. Q2 FY2021/22), followed by its results on a y-o-y basis (i.e. 1H FY2020/21 vs. 1H FY2021/22):

Q2 FY2020/21 vs. Q2 FY2021/22:

Q2 FY2020/21Q2 FY2021/22% Variance
Gross Revenue
(S$’mil)		$131.9m$165.1m+25.2%
Property Operating
Expenses (S$’mil)		$13.0m$20.6m+58.6%
Net Property
Income (S$’mil)		$118.9m$144.4m+21.5%
Distributable Income
to Unitholders
(S$’mil)		$78.3m$93.4m+19.2%

Looking at the above, its q-o-q results is an improved one (with the percentage of its top- and bottom-line growth is similar to that recorded in the first quarter – you can read about my review here.)

For the current quarter under review, the 25.2% q-o-q growth in its gross revenue is mainly due to higher revenue from its existing properties, higher occupancy from Mapletree Ouluo Logistics Park Phase 2 which completed re-development in Q1 FY2020/21, along with contributions from the REIT’s acquisitions in China, Vietnam, South Korea, Japan, Australia, and India – all of them completed in the previous financial year 2020/21.

The 58.6% q-o-q jump in its property operating expenses is due to the property expenses incurred by the newly acquired properties, along with the recognition of allowance for doubtful receivables.

In-line with the growth in its gross revenue, its net property income, as well as its distributable income to unitholders, saw improvements by a similar percentage.

1H FY2020/21 vs. 1H FY2021/22:

1H FY2020/211H FY2021/22% Variance
Gross Revenue
(S$’mil)		$264.2m$328.8m+24.4%
Property Operating
Expenses (S$’mil)		$26.5m$40.2m+51.5%
Net Property
Income (S$’mil)		$237.7m$288.6m+21.4%
Distributable Income
to Unitholders
(S$’mil)		$156.1m$186.1m+19.1%

On a y-o-y basis, the blue-chip logistics REIT continued to report an improved set of results – the growth in its gross revenue is mainly due to higher revenue from its existing properties, contribution from acquisitions in China, Vietnam, South Korea, Japan, Australia, and India completed in FY2020/21, along with the completed re-development of Mapletree Ouluo Logistics Park Phase 2 in the the first quarter of FY2020/21.

Also, the 51.5% y-o-y rise in its property operating expenses is due to expenses incurred by the newly acquired properties in FY2020/21, as well as the recognition of allowance for doubtful receivables.

Portfolio Occupancy Profile (Q1 FY2021/22 vs. Q2 FY2021/22)

Moving on, let us take a look at the REIT’s portfolio occupancy profile recorded for the current quarter under review (i.e. Q2 FY2021/22 ended 30 September 2021), where I will be comparing it against the stats recorded in the previous quarter (i.e. Q1 FY2021/22 ended 30 June 2021) to find out whether or not it has continued to remain resilient:

Q1 FY2021/22Q2 FY2021/22
Portfolio Occupancy
(%)		97.8%97.8%
Rental Reversion
(%)		+2.2%+2.4%
WALE (by Net Lettable
Area – years)		3.8 years3.7 years

My Observations: Compared to the previous quarter, I must say that its portfolio occupancy profile have continued to remain resilient, due to higher occupancy in Singapore and Japan.

Looking at the REIT’s lease expiries in the near-term, 14.6% of the leases will be expiring in the second half of FY2021/22, and another 28.5% of the leases will be expiring in the next financial year.

Debt Profile (Q1 FY2021/22 vs. Q2 FY2021/22)

Just like how I have reviewed its portfolio occupancy profile in the previous section, I will also be taking a look at the key debt profile statistics which the REIT have posted for the current quarter under review, and compare it against the statistics recorded in the previous quarter (i.e. Q1 FY2021/22 ended 30 June 2021) to find out if it has continued to remain resilient:

Q1 FY2021/22Q2 FY2021/22
Aggregate Leverage
(%)		38.2%38.2%
Interest Coverage
Ratio (times)		5.2x5.2x
Average Term to
Debt Maturity (years)		3.7 years3.6 years
Average Cost of
Debt (%)		2.2%2.2%

My Observations: Similar to its portfolio occupancy profile, the REIT’s debt profile for the current quarter under review also continued to remain more or less the same compared to the previous quarter – Its aggregate leverage, at 38.2%, provides ample debt headroom for them to make further yield-accretive acquisitions (before it reaches the regulatory limit of 50.0%) should an opportunity to do so arise. Its interest coverage ratio, at 5.2x, is also one I’m comfortable with (personally, if the REIT is able to maintain its interest coverage ratio at above 5.0x, it is considered ideal.)

Finally, as far as the REIT’s debt maturity is concerned, only 3% (or S$110m) of its total borrowings will be maturing in the second half of the current financial year, and I understand from its presentation slides that there is sufficient available committed credit facilities (of S$674m) to refinance.

Distribution Payout to Unitholders

For the current quarter under review, the REIT has declared a distribution payout of 2.173 cents/unit, a 5.7% improvement from the 2.055 cents/unit declared in the same time last year. On a y-o-y basis, its distribution payout have also grown by the same percentage (of 5.7%) – from 4.10 cents/unit in 1H FY2020/21 to 4.334 cents/unit in 1H FY2021/22.

If you are a unitholder of the REIT, you may want to take note of the following dates regarding its upcoming distribution payout:

Ex-Date: 01 November 2021
Record Date: 02 November 2021
Payout Date: 14 December 2021

Closing Thoughts

An improved set of financial results (both on a q-o-q as well as on a y-o-y basis, as a result of higher revenue from its existing properties and also contribution from its newly acquired properties), along with its portfolio occupancy and debt profile continuing to remain resilient, and unitholders being rewarded with a higher distribution payout – what’s not to like about the blue-chip logistics REIT’s latest ‘report card’ (I’m sure you’ll agree with me that it’s a good set of results.)

With that, I have come to the end of my review of Mapletree Logistics REIT’s latest set of results. As always, do take note that the contents above does not constitute any buy or sell calls for the REIT’s units. You should always do your own due diligence before making any investment decisions.

Related Documents

Disclaimer: At the time of writing, I am a unitholder of Mapletree Logistics Trust.

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