Ascott Residence Trust's earnings slip 4% to $38.5m

As revenue inched up by a measly 1%.

According to OCBC, Ascott Residence Trust registered 4Q12 DPU of 2.00 S cents, above consensus but slightly lower than OCBC's estimate. 4Q12 revenue climbed 1% YoY to S$75.9m, with contributions from acquisitions partially offset by decrease from divestments. 

Notably, gross profit fell by 4% YoY to S$38.5m. Management attributed the compression in gross profit margin to higher expenses in China, the Philippines and Vietnam (staff cost, and also utilities cost in the Philippines), and expects these cost pressures to persist.

"4Q12 RevPAU declined 5% to S$139 due to weaker performance from the serviced residences in Vietnam and Indonesia (Ascott Jakarta undergoing refurbishment). The fair value of its properties declined S$27.9m in 4Q12 to S$2.79b, partially due to FX translation," OCBC noted.