Mapletree Logistics Trust (SGX: M44U)'s fourth-quarter DPU went up 1.2% to 2.048¢, taking its full-year payout to 8.142¢ (up +2.5% year-on-year). It is currently trading at 4.4% yield based on the last traded share price of $1.83 on 22 May.
Distribution per unit (DPU) and Dividend Yield (4.4%)
Price to book ratio (1.48)
Interest coverage ratio (4.9x)
Portfolio occupancy rate (98%)
Background of Mapletree Logistics Trust
Mapletree Logistics Trust is Singapore’s first Asia-focused logistics REIT, listed on the Singapore Stock Exchange in 2005. The REIT invests in a diversified portfolio of quality, well-located, income-producing logistics real estate in Singapore, Hong Kong, Japan, China, Australia, South Korea, Malaysia and Vietnam.
1. Distribution per unit and dividend yield
In its latest quarterly result, Mapletree Logistics Trust delivered a healthy operational performance, with a 1.2% increase in DPU. Based on its latest price, the REIT is currently trading at about 4.4% dividend yield. Historically, the REIT has been paying very consistent DPU, with steady growth over the years. However, its current 4.4% yield is at the low side as compared to its average yield of 6.8% over the past 10 years.
2. Price to book ratio
Over the past 10 years, Mapletree Logistics Trust has been trading at an average price to book ratio of 1.06. Its current ratio of 1.48 does not look attractive as it is still well above its historical average.
Portfolio leverage increased to 39.3%. This was mainly due to additional loans of S$364m to partially fund acquisitions, capital expenditure and working capital during the year.
4. Interest coverage ratio
The REIT has an interest coverage ratio of 4.9 times, which is slightly above our preference of 4 times. Besides, the REIT's overall interest cost dropped to 2.5%. The REIT managed to commit credit facilities of over S$700m to refinance its S$242m loan (6% of its total debt) due in the coming financial year. Its debt maturity profile remains well staggered with an average debt duration of 4.1 years.
5. Portfolio occupancy rate
Portfolio occupancy remains at an almost full occupancy rate of 98%. It newly acquired asset in Japan, Mapletree Kobe Logistics also maintained an occupancy rate of 99.7%.
6. Growth Catalyst
During this Covid-19 period, the REIT management mentioned that most of its tenants in Hong Kong and Japan are operational and only 5% of its Singapore's tenant base is impacted. Among its tenant base, retail, hospitality and travel sector took the biggest hit. Fortunately, this group of tenants only account for 10% of its revenue.
While the logistics sector has been relatively resilient, but the management warned that should the on-going Covid-19 situation worsen, the demand for warehouse space, could be weakened. This would potentially impact the REIT's DPU in the next quarter.
Mapletree Logistics Trust has been delivering very healthy financial metrics over the years. However, it is currently trading at a relatively expensive valuation. We will keep it under the watchlist at the moment.
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