Thursday 25 January 2024

Mapletree Industrial Trust Financial Results 3QFY23/24 - The Good and The Bad

MIT released its latest quarterly results today after market hours.
Following will be a succinct post for my own reference on some salient points - both the good and bad in my opinion, as well as my personal take on the results.
Positive rental reversions for all segments.

79.5% borrowings hedged.

Relatively low leverage of 38.6%.
Good interest coverage of >4 times.
Still healthy portfolio occupancy.
Largest tenant only contributes 6% to total portfolio gross rental income. 

Diversified tenants in terms of trade. Less concentration risk for downturn.
Maturing debts are quite well spread.

55.6% of AUM is in data centres which is good for now especially in North America where centres vacancy is low and average asking rental rate has been rising for the past two years. 
Also moving forward, the rise of artificial intelligence-related businesses should be good news for the data centre segment in general.


Funding cost below 3% would have been better in this environment. 
Distribution to unitholders is increased Y-o-Y partly because of compensation received for 2 and 4 Loyang Lane. Without that, the distribution to unitholders is actually quite flat.
Not so good outlook painted by management.
Possible hint at flat or declining forward DPU(s) due to possible rising operating expenses and increases in borrowing costs.
3.36 cents per unit.
To be paid on 7/3/2024.
Personal Take
Set of results is not too bad. To be cautious of its outlook for the next three quarters at least.
Not likely to add at present price (2.44) unless there is a big positive catalyst. Will continue to add if unit price is closer to 2.40 or lower for bigger margin of safety.

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