Cromwell European REIT's 2H FY23 Result Review
$Cromwell Reit SGD(CWCU.SI)$ $Cromwell Reit EUR(CWBU.SI)$
Basic Profile & Key Statistics
Key Indicators
Performance Highlight
Gross revenue and NPI declined YoY mainly due to lower income resulting from the divestment of Piazza Affari 2 and Corso Lungomare Trieste 29, as well as the absence of income from Maxima, which was under redevelopment. Additionally, higher finance costs offset by a tax reversal contributed to a reduction in distributable income and DPU YoY.
Rental Reversion
The rental reversion for 2H FY23 stands at 5.7%.
Divestment
In 4Q FY23, CEREIT divested Viale Europa 95 and Corso Lungomare Trieste 29 in Italy.
Development
Redevelopment for Nervesa 21 was completed in January 2024. Maxima is currently undergoing strip-out work. Additionally, CEREIT has identified three redevelopment opportunities.
Related Parties Shareholding
The REIT manager and directors of the REIT manager hold a relatively low proportion of shares.
Lease Profile
The WALE is relatively long and the lease expiry is well spread. Additionally, the weighted average land lease expiry is long.
Debt Profile
The adjusted interest coverage ratio and fixed rate debt proportion are relatively high. Additionally, cost of debt is relatively low. However, debt maturity is concentrated.
Diversification Profile
The portfolio demonstrates an excellent diversification profile.
Key Financial Metrics
Operating distributable income on capital is high, and all distributions are derived from operations. Additionally, the management fee is low compared to operating distributable income.
DPU Breakdown
TTM Distributable Income Breakdown:100% from Operation
Trends
Slight Uptrend: Committed Occupancy
Slight Downtrend: Property Yield
Downtrend: DPU from Operation, NAV per Unit, Adjusted Interest Coverage Ratio, Operating Distributable Income on Capital, Operating Distributable Income Margin
Relative Valuation
Dividend Yield - Average for 1y; Above +1SD for 3y & 5y
P/NAV - Average for 1y; Below -1SD for 3y & 5y
Author's Opinion
Compared to the previous quarter, gross revenue, NPI, and DPU remain similar. Regarding debts, there is no refinancing requirement until November 2025.
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