{"id":2762,"date":"2024-02-07T00:40:24","date_gmt":"2024-02-06T16:40:24","guid":{"rendered":"https:\/\/www.wealthfor.us\/article\/?p=2762"},"modified":"2024-02-07T00:45:56","modified_gmt":"2024-02-06T16:45:56","slug":"capitaland-integrated-commercial-trust-cict-q4-2023-key-highlights","status":"publish","type":"post","link":"https:\/\/www.wealthfor.us\/article\/capitaland-integrated-commercial-trust-cict-q4-2023-key-highlights\/","title":{"rendered":"CapitaLand Integrated Commercial Trust CICT Q4 2023: Key Highlights"},"content":{"rendered":"<p><a href=\"https:\/\/www.wealthfor.us\/article\/reits\/view\/C38U:SGX\/\"><span style=\"font-weight: 400;\">CapitaLand Integrated Commercial Trust (CICT)<\/span><\/a><span style=\"font-weight: 400;\"> has just released its <\/span><a href=\"https:\/\/investor.cict.com.sg\/newsroom\/02c_CICT_Slides_FY2023_Financial_Results.pdf\" target=\"_blank\" rel=\"noopener\"><span style=\"font-weight: 400;\">FY2023 financial results<\/span><\/a><span style=\"font-weight: 400;\">. Let&#8217;s look into CICT Q4 2023 results to see how it performed last quarter.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">CICT is Singapore&#8217;s first and largest REIT, with exposure to the office and retail sectors in Singapore, Australia, and Germany.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>Financial Performance<\/h2>\n<p><span style=\"font-weight: 400;\">In the table below, we compare CICT FY2023 vs. FY2022 results:<\/span><\/p>\n<table>\n<thead>\n<tr>\n<th><\/th>\n<th>FY2023<\/th>\n<th>FY2022<\/th>\n<th>Change<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Gross Revenue<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">$1,559.9m<\/span><\/td>\n<td><span style=\"font-weight: 400;\">$1,441.7m<\/span><\/td>\n<td><span style=\"font-weight: 400;\">+8.2%<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Operating Expenses<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">$444.0m<\/span><\/td>\n<td><span style=\"font-weight: 400;\">$398.4m<\/span><\/td>\n<td><span style=\"font-weight: 400;\">+11.45%<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Net Property Income<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">$1,115.9m<\/span><\/td>\n<td><span style=\"font-weight: 400;\">$1,043.3<\/span><\/td>\n<td><span style=\"font-weight: 400;\">+7.0%<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Distributable Income<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">$715.5m<\/span><\/td>\n<td><span style=\"font-weight: 400;\">$702.4m<\/span><\/td>\n<td><span style=\"font-weight: 400;\">+1.87%<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">DPU<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">10.75 cents<\/span><\/td>\n<td><span style=\"font-weight: 400;\">10.58 cents<\/span><\/td>\n<td><span style=\"font-weight: 400;\">+1.61%<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">Gross revenue climbed by 8.2% YoY from $1.44 billion to $1.56 billion but was offset by higher operating expenses, which also jumped by 11.45%. The net property income grew 7% YoY to $1.12 billion. Revenue growth can be attributed to the full-year contributions from recent acquisitions in 2022 and the higher rental income from existing properties.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">As a result, CICT managed to increase its DPU slightly by 1.6% YoY from 10.58 cents to 10.75 cents, a welcome news given the current economic climate. Overall, CICT&#8217;s financial performance looks stable.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>Debt Profile<\/h2>\n<p><span style=\"font-weight: 400;\">Here we compare CICT Q4 2023 vs. Q3 2023 debt profiles:<\/span><\/p>\n<table>\n<thead>\n<tr>\n<th><\/th>\n<th>Q4 2023<\/th>\n<th>Q3 2023<\/th>\n<th>Change<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Aggregate Leverage Ratio<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">39.9%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">40.8%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">-0.9%<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">% of Borrowings on Fixed Interest Rate<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">78%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">78%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">N\/A<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Interest Coverage Ratio<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">3.1x<\/span><\/td>\n<td><span style=\"font-weight: 400;\">3.1x<\/span><\/td>\n<td><span style=\"font-weight: 400;\">N\/A<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Average Cost of Debt<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">3.4%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">3.3%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">+0.1%<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">CICT&#8217;s debt profile looks relatively healthy. We saw an improvement in its aggregate leverage ratio by 0.9% to 39.9%. The percentage of borrowings hedged to a fixed rate was stable at 78%. Notably, the interest coverage ratio has stabilized at 3.1x, halting the declining trend observed in previous quarters. Overall, we like CICT&#8217;s debt profile and think CICT should be able to weather any prolonged higher interest rate environment.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>Debt Maturity Distribution<\/h2>\n<figure id=\"attachment_2763\" aria-describedby=\"caption-attachment-2763\" style=\"width: 647px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-2763\" src=\"https:\/\/www.wealthfor.us\/article\/wp-content\/uploads\/2024\/02\/CICT-Q4-2023-debt-maturity-distribution.png\" alt=\"CICT Q4 2023 debt maturity distribution\" width=\"647\" height=\"351\" srcset=\"https:\/\/cdn.wealthfor.us\/uploads\/2024\/02\/CICT-Q4-2023-debt-maturity-distribution.png 647w, https:\/\/cdn.wealthfor.us\/uploads\/2024\/02\/CICT-Q4-2023-debt-maturity-distribution-300x163.png 300w\" sizes=\"auto, (max-width: 647px) 100vw, 647px\" \/><figcaption id=\"caption-attachment-2763\" class=\"wp-caption-text\">Source: <a href=\"https:\/\/www.wealthfor.us\/article\/reits\/view\/C38U:SGX\/\">CICT Analysis page<\/a><\/figcaption><\/figure>\n<p><span style=\"font-weight: 400;\">Despite the expected rate cuts, the market expects the interest rate to remain elevated this year and next. The good news is that CICT has a well-distributed debt maturity distribution, with only 16% due for refinancing in 2024 and 13% in 2025. We can see from the chart that there are only around 11-15% of refinancing obligations every year until 2030.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">We think CICT&#8217;s debt maturity distribution is well spread out enough that it should be able to weather the current higher interest environment.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>Portfolio Occupancy<\/h2>\n<p><span style=\"font-weight: 400;\">Here is the summary of CICT portfolio occupancy metrics:<\/span><\/p>\n<table>\n<thead>\n<tr>\n<th><\/th>\n<th>Q4 2023<\/th>\n<th>Q3 2023<\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><i><span style=\"font-weight: 400;\">Portfolio Occupancy<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">97.3%<\/span><\/td>\n<td><span style=\"font-weight: 400;\">97.3%<\/span><\/td>\n<\/tr>\n<tr>\n<td><i><span style=\"font-weight: 400;\">WALE<\/span><\/i><\/td>\n<td><span style=\"font-weight: 400;\">3.4 years<\/span><\/td>\n<td><span style=\"font-weight: 400;\">3.5 years<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">Again, we can see a solid portfolio occupancy rate for CICT. Both the portfolio occupancy and the WALE were stable last quarter. CICT also recorded FY2023 positive rental reversions of 8.5% for its retail and 9% for its office portfolios.<\/span><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter size-full wp-image-2764\" src=\"https:\/\/www.wealthfor.us\/article\/wp-content\/uploads\/2024\/02\/CICT-Q4-2023-lease-expiry-distribution.png\" alt=\"CICT Q4 2023 lease expiry distribution\" width=\"952\" height=\"316\" srcset=\"https:\/\/cdn.wealthfor.us\/uploads\/2024\/02\/CICT-Q4-2023-lease-expiry-distribution.png 952w, https:\/\/cdn.wealthfor.us\/uploads\/2024\/02\/CICT-Q4-2023-lease-expiry-distribution-300x100.png 300w, https:\/\/cdn.wealthfor.us\/uploads\/2024\/02\/CICT-Q4-2023-lease-expiry-distribution-768x255.png 768w\" sizes=\"auto, (max-width: 952px) 100vw, 952px\" \/><\/p>\n<p><span style=\"font-weight: 400;\">For its lease expiry, it is pretty well spread out over the next several years. However, it is worth noting that about 40% of leases are due for renewal within the next two years.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2>Remarks<\/h2>\n<p><span style=\"font-weight: 400;\">As expected, CICT&#8217;s financial performance was stable last quarter. Despite the challenging economic environment, CICT still managed to grow its revenue and net property income by 8.2% and 7.0%, respectively. CICT DPU climbed by 1.6% YoY to 10.75 cents for FY2023.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">CICT&#8217;s debt profile also strengthened slightly last quarter, with the aggregate leverage ratio decreasing to 39.9%. The debt maturity profile was also healthy, with only 16% refinancing obligation due in 2024 and 13% due in 2025.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Coupled with its strong portfolio occupancy profile, we think CICT is well-equipped to weather any prolonged higher interest environment that is expected to last longer throughout 2024 and possibly 2025.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">If you are a CICT unitholder, the DPU for H2 2023 is 5.45 cents. Please take note of the following dividend dates:<\/span><\/p>\n<table>\n<tbody>\n<tr>\n<td><span style=\"font-weight: 400;\">Ex-dividend Date<\/span><\/td>\n<td><span style=\"font-weight: 400;\">14 Feb 2024<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Record Date<\/span><\/td>\n<td><span style=\"font-weight: 400;\">15 Feb 2024<\/span><\/td>\n<\/tr>\n<tr>\n<td><span style=\"font-weight: 400;\">Payout Date<\/span><\/td>\n<td><span style=\"font-weight: 400;\">28 Mar 2024<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p><span style=\"font-weight: 400;\">CICT has a dividend yield of 5.3% and a price-to-book ratio of 0.95. To learn more about CICT, please visit our <\/span><a href=\"https:\/\/www.wealthfor.us\/article\/reits\/view\/C38U:SGX\/\"><span style=\"font-weight: 400;\">CICT analysis<\/span><\/a><span style=\"font-weight: 400;\"> page and our <\/span><a href=\"https:\/\/www.wealthfor.us\/article\/reits\/view\/C38U:SGX\/dividend\/\"><span style=\"font-weight: 400;\">CICT dividend<\/span><\/a><span style=\"font-weight: 400;\"> page.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">You may also check out our <\/span><a href=\"https:\/\/www.wealthfor.us\/article\/singapore-reits\/\"><span style=\"font-weight: 400;\">Singapore REITs<\/span><\/a><span style=\"font-weight: 400;\"> page to analyze other REITs.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>CapitaLand Integrated Commercial Trust (CICT) has just released its FY2023 financial results. Let&#8217;s look into CICT Q4 2023 results to see how it performed last quarter. CICT is Singapore&#8217;s first and largest REIT, with exposure to the office and retail sectors in Singapore, Australia, and Germany. &nbsp; Financial Performance In the table below, we compare&hellip; <a class=\"more-link\" href=\"https:\/\/www.wealthfor.us\/article\/capitaland-integrated-commercial-trust-cict-q4-2023-key-highlights\/\">Continue reading <span class=\"screen-reader-text\">CapitaLand Integrated Commercial Trust CICT Q4 2023: Key Highlights<\/span><\/a><\/p>\n","protected":false},"author":3,"featured_media":2765,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[111,102],"tags":[],"class_list":["post-2762","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-reit","category-singapore","entry"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.5 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>CapitaLand Integrated Commercial Trust CICT Q4 2023<\/title>\n<meta name=\"description\" content=\"How were CICT Q4 2023 financial results? 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