Mapletree Logistics Trust's net property income dipped 3.3% to S$65.3m

Blame it on weaker Japan yen.

According to OCBC Investment Research, Mapletree Logistics Trust reported 1QFY14 gross revenue of S$75.4m and NPI of S$65.3m, down 2.2% and 3.3% respectively. The decline was mainly due to a weaker JPY.

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Excluding the forex impact, gross revenue and NPI would have increased by 3.1% and 2.0% respectively. The impact of the depreciating JPY on distributable income was limited as ~90% of the amount is hedged into or derived in SGD.

During the quarter, MLT also benefitted from lower borrowing costs and a S$0.6m distribution of the divestment gain from 30 Woodlands Loop (S$5.0m spread over eight quarters from 1Q).

As a result, amount distributable to unitholders rose 6.9% YoY to S$44.0m, while DPU grew 5.9% to 1.80 S cents. Stripping out the divestment gain, DPU would be up 4.7% YoY. The results were in line with expectations, as 1Q DPU have met 24.8%/25.4% of our/consensus full-year DPU projections.

Overall occupancy stood at 98.2%, largely stable from 98.5% seen in previous quarter. There was a 2.9ppt QoQ dip in MLT’s China portfolio occupancy due to a non-renewal of a tenant, but management noted that the space has since been leased out.

For FY14, ~15% of the leases are due for renewal, and ~27% of these have already been renewed/replaced to-date. In addition, positive rental reversion of 17% was achieved. This is higher than prior quarter’s growth of 14%, although MLT maintains its view that the rate is set to moderate going forward.