Mapletree Industrial Trust's net property income up 6.4% to $66m

Thanks to lower property maintenance expenses.

Mapletree Industrial Trust's recent results have proven its resiliency in the market.

According to OCBC Investment Research, gross revenue increased by 4.5% YoY to $87.8m whilst net property income jumped 6.4% YoY to $66m.

The growth in gross revenue was underpinned by higher rental rates for its Flatted Factories, Hi-Tech Buildings and Stack-up/Ramp-up Buildings, coupled with contribution arising from Phase One of the built-to-suit project for Hewlett-Packard Singapore from mid-Dec 2016. This is partially offset by lower portfolio occupancy.

NPI was driven by higher margins due largely to lower property maintenance expenses and marketing commission.

Meanwhile, DPU came in at 2.88 S cents, representing YoY growth of 2.5%

Here's more from OCBC:

Despite headwinds facing the industrial sector, MIT’s operational performance remained largely resilient. Its average portfolio gross rental rate inched up 0.5% QoQ to S$1.94 psf/month in 4QFY17, while overall occupancy rate improved by 1 ppt QoQ to 93.1%.

There were mixed signals from renewal leases signed during the quarter. Positive rental reversions were recorded for Hi-Tech Buildings (+4.0%), Business Park Buildings (+1.0%) and Flatted Factories (+0.6%), but its Stack-up/Ramp-up Buildings and Light Industrial Buildings saw negative rental reversions of 4.3% and 0.6%, respectively.

In terms of financial position, MIT’s balance sheet remains strong, with a low aggregate leverage ratio of 29.2%, as at 31 Mar 2017. 74.9% of its borrowings have been hedged. The weighted average hedge tenor is 4.0 years, with none of the hedges due to expire in FY18
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