Mapletree Logistics Trust (SGX:M44U), Singapore’s first Asia-focused logistics REIT with 184 properties in its portfolio at the time of writing of this post (53 in Singapore, 9 in Hong Kong, 19 in Japan, 42 in China, 13 in Australia, 16 in Malaysia, 20 in South Korea, 10 in Vietnam, and 2 in India), have made available its results for the fourth quarter, as well as for the full-year ended 31 March 2022 (i.e. FY2021/22) shortly after trading hours this evening (28 April 2022.)

As a unitholder of the Mapletree REIT (you can find out a list of all the companies I’m currently vested in, my average prices for each of them, and also whether I’m in a profit/loss in percentage terms here), I have studied the documents which it had posted and in this post, you will find my review about its latest set of financial performance, portfolio occupancy and debt profile, and also its distribution payout for the period under review.

Let’s get started:

Financial Performance (Q4 FY2020/21 vs. Q4 FY2021/22, and FY2020/21 vs. FY2021/22)

In this section, you’ll find a comparison of the logistics REIT’s financial performance both on a quarter-on-quarter (q-o-q) basis (i.e. Q4 FY2020/21 vs. Q4 FY2021/22) as well as on a year-o-n-year (y-o-y) basis (i.e. FY2020/21 vs. FY2021/22):

Q4 FY2020/21 vs. Q4 FY2021/22:

Q4 FY2020/21Q4 FY2021/22% Variance
Gross Revenue
(S$’mil)
$157.0m$182.9m+16.5%
Propert Operating
Expenses (S$’mil)
$20.3m$25.8m+26.7%
Net Property
Income (S$’mil)
$136.7m$157.1m+14.9%
Distributable Income
to Unitholders (S$’mil)
$92.6m$108.0m+16.7%

As a unitholder, I’m pleased with the double-digit growth in the REIT’s gross revenue, net property income, as well as in its distributable income to unitholders.

The 16.5% and 14.9% q-o-q improvement in its gross revenue and net property income can be attributed to contributions from its newly acquired properties in China, Vietnam, and Malaysia (completed in Q4 FY2021/22), along with full quarter contributions from its acquisitions in Japan, South Korea, and Australia (completed in Q3 FY2021/22.)

Along with property expenses incurred by the newly acquired properties, as well as higher property tax, and higher repair and maintenance costs, its property operating expenses saw a 26.7% q-o-q climb.

FY2020/21 vs. FY2021/22:

FY2020/21FY2021/22% Variance
Gross Revenue
(S$’mil)
$561.1m$678.6m+20.9%
Propert Operating
Expenses (S$’mil)
$62.0m$86.4m+39.3%
Net Property
Income (S$’mil)
$499.1m$592.1m+18.6%
Distributable Income
to Unitholders (S$’mil)
$333.1m$390.7m+17.3%

On a full-year basis, I’m sure you’ll agree with me that the blue-chip logistics REIT’s performance is a strong one – just like on a q-o-q basis, its gross revenue, net property income, and its distributable income to unitholders all saw double-digit percentage improvements as well (when compared against the previous financial year.)

In terms of the growth in its gross revenue and net property income, it was mainly due to higher revenue from existing properties, contributions from acquisitions in China, South Korea, India, Japan, Australia, Vietnam, and Malaysia completed in the current financial year (FY2021/22), and in the previous financial year (FY2020/21), completed redevelopment of Mapletree Ouluo Logistics Park Phase 2 in the first quarter of FY2020/21, as well as lower Covid-19 related rental rebates to its tenants.

The 39.3% jump in its property operating expenses was mainly due to property expenses from acquisitions completed this financial year, as well as in the previous financial year, higher property and land tax, along with higher repair and maintenance costs.

Portfolio Occupancy (Q3 FY2021/22 vs. Q4 FY2021/22)

When it comes to reviewing a REIT’s portfolio occupancy profile, I tend to compare its stats reported for the current quarter under review (i.e. Q4 FY2021/22 ended 31 March 2022) against that reported in the previous quarter 3 months ago (i.e. Q3 FY2021/22 ended 31 December 2021) to find out whether or not it has continued to remain resilient:

Q3 FY2021/22Q4 FY2021/22
Portfolio Occupancy
(%)
97.8%96.7%
Rental Reversion
(%)
+2.5%+2.9%
Portfolio WALE
(by NLA – years)
3.6 years3.5 years

My Observations: No doubt the REIT’s portfolio occupancy, when compared against the previous quarter, fell by about one percentage point (pp) due to a slight dip in occupancy rate in its properties in Singapore (from 98.1% in Q3 FY2021/22 to 97.8% in Q4 FY2021/22), South Korea (from 98.8% in Q3 FY2021/22 to 98.2% in Q4 FY2021/22), China (from 95.9% in Q3 FY2021/22 to 93.1% in Q4 FY2021/22), but its no cause for concern as portfolio occupancy rates for its properties in all the geographical locations (except for China) remains above 95.0%.

Another thing about its portfolio occupancy profile to highlight is that rental reversions have not only continued to remain positive, but its 0.4pp higher than the previous quarter.

Finally, in terms of the REIT’s lease expiries in the coming financial years ahead, it is concentrated over the next 3 financial years – with 29.9% of the leases expiring in the coming financial year 2022/23, 20.5% of the leases expiring in the financial year 2023/24, and 16.5% of the leases expiring in the financial year 2024/25.

Debt Profile (Q3 FY2021/22 vs. Q4 FY2021/22)

Similar to how I have looked at its portfolio occupancy profile in the previous section, I have also reviewed the REIT’s debt profile for the current quarter under review against that reported in the previous quarter in the table below:

Q3 FY2021/22Q4 FY2021/22
Aggregate Leverage
(%)
34.7%36.8%
Interest Coverage
Ratio (times)
5.1x5.0x
Average Term to
Debt Maturity (years)
3.5 years3.8 years
Average Cost of
Debt (%)
2.2%2.2%

My Observations: The only slight negative to note about its latest set of debt profile is its aggregate leverage edging up to 36.8% – despite of that, it is still a very good distance away from the regulatory limit of 50.0%, which allows REIT to embark on more yield-accretive acquisition opportunities to grow its portfolio (and also its financial performances.)

Its debt maturity profile is also well-staggered in the coming years ahead – with 11% of its borrowings due for refinancing in FY2022/23 (which I understand from its presentation slides that there is sufficient committed credit facilities to refinance the debt), 13% due in FY2023/24 and in FY2024/25, and the remaining 63% of its borrowings only due in FY2025/26 or later.

The REIT is also well-protected (in my opinion) from the negative impacts of the upcoming interest rate hikes, with 79% of its total debt hedged or drawn in fixed rates.

Distribution Payout to Unitholders

Mapletree Logistics Trust is one of the few remaining Singapore-listed REITs that have continued to declare a distribution payout to its unitholders on a quarterly basis (so for those of you who are looking to invest in REITs that pays out a distribution once every 3 months, this is one you can consider) – for the current quarter under review, the REIT’s management have declared a distribution payout of 2.268 cents/unit – a 5.0% increase from 2.161 cents/unit declared a year ago (i.e. Q4 FY2020/21.)

Together with its distribution payout declared in Q1 (2.161 cents/unit), Q2 (2.173 cents/unit), as well as Q3 (2.185 cents/unit), its total distribution payout for FY2021/22 amounts to 8.787 cents/unit – which is a 5.5% improvement from its total payout of 8.326 cents/unit in the previous financial year 2020/21.

If you are a unitholder of the logistics REIT, do take note of the following dates on its distribution payout:

Ex-Date: 09 May 2022
Record Date: 10 May 2022
Payout Date: 21 June 2022

Closing Thoughts

As a unitholder of the blue-chip logistics REIT, I am satisfied with its latest financial performance (where both on a q-o-q as well as on a y-o-y basis, its top- and bottom-line saw double-digit percentage growths, primarily driven by contribution from its newly acquired properties), portfolio occupancy profile (where on the whole, its properties in all the different geographic locations are more than 90.0% occupied), debt profile (where its well-shielded from the negative impacts of interest rate hikes with 79% of its total debts hedged at fixed rates; its aggregate leverage also remains very healthy at 36.8%.)

In fact, the REIT is one of the most resilient among all the Singapore-listed REITs, and one I’m happy to stay invested for the long haul.

With that, I have come to the end of my review on Mapletree Logistics Trust’s latest fourth quarter, and full year results. As always, do note that everything (especially my thoughts) you have read above are purely my own, which I’m sharing for educational purposes only, and that you should always do your own due diligence before you make any investment decisions.

Related Documents

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

 

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