Cache REIT DPU down 9.5% to 1.8 S cents

Lower revenue and conversion costs push down DPU.

Cache Logistics Trust struggled for the second quarter this year when its distribution per unit (DPU) dropped by 9.5% to 1.8 cents.

According to its financial statement, the revenue for the year also dipped by 0.7% to $27.9m while net property income (NPI) fell by 4.0% to $21.7m.

The dip in revenue was caused by the sale of the Cache Changi Districentre 3 and the lower income from 51 Alps Avenue, which is still being fought over in a legal battle.

The conversion of the company’s master-leased properties in 40 Alps Avenue to multi tenant properties also contributed to the dip of the NPI.

Higher contribution from warehouse and property leases in Cache Cold Centre, Cache Changi Districentre 1, and DHL Supply Chain Advanced Regional Centre partially offset the fall.

In a report, OCBC Investment Research analyst Deborah Ong said, "We find it encouraging that 2Q17 DPU stayed flat QoQ, with DPU from operations increasing 5.4% QoQ. For 1H17, DPU fell 10.6% to 3.6 S cents or 51.0% of our full-year forecast."