SPH Reit maintains Q4 DPU of 1.39 Singapore cents; sees 100% occupancy at both malls

By

Lee Meixianleemx@sph.com.sg@LeeMeixianBT

SPH Reit on Monday posted a distribution per unit (DPU) of 1.39 Singapore cents for its fourth quarter ended Aug 31, 2015. 

PHOTO: SPH

OCT 12, 20157:28 PM

SPH Reit on Monday posted a distribution per unit (DPU) of 1.39 Singapore cents for its fourth quarter ended Aug 31, 2015.

Gross revenue slipped 0.6 per cent to S$50.8 million, while net property income rose 0.4 per cent to S$38.2 million on lower costs.

For the full year, the DPU was 5.47 Singapore cents, 0.7 per cent higher than a year ago. Gross revenue was up 1.4 per cent to S$205.1 million, while net property income rose 3.3 per cent to S$155.6 million.

Both its malls, Paragon and The Clementi Mall, maintained 100 per cent occupancy. But tenant sales at the upmarket Paragon along the Orchard Road shopping belt saw a 3.2 per cent drop in tenant sales on slowing tourist arrivals as well as the fitting-out period as some tenants expanded, causing others to have to move.

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The Clementi Mall also saw rental rates renewed at 5.6 per cent lower than their preceding rates "on a very small percentage (5 per cent) of total net lettable area". This occurred as the mall manager sought to improve its tenant and product mix. Sometimes, this involves signing on tenants whom it can only charge lower rentals. The Clementi Mall completed its first renewal cycle last year.

At a media briefing, CEO Susan Leng maintained that The Seletar Mall was doing well, but was not stabilised enough to be injected into the Reit. SPH Reit will also continue to work with its sponsor, Singapore Press Holdings (SPH), to bid for suitable sites through the Government Land Sales programme as well as negotiate for sites through private treaties.

Shares of SPH Reit rose one per cent to S$0.965
.

ST Aerospace wins contracts worth S$410m in Q3

By

Andrea Sohsandrea@sph.com.sg@AndreaSohBT

The aerospace arm for Singapore Technologies Engineering (ST Engineering) has clinched contracts worth S$410 million in the third quarter, for projects including airframe and component maintenance, engine wash and pilot training. 

PHOTO: ST AEROSPACE

OCT 12, 20156:03 PM

THE aerospace arm for Singapore Technologies Engineering (ST Engineering) has clinched contracts worth S$410 million in the third quarter, for projects including airframe and component maintenance, engine wash and pilot training.

There were agreements signed for heavy airframe maintenance for various Boeing 777-300 and Airbus A319/A321 aircraft belonging to a US airline, and one for cabin interior modification for another US airline's A319 fleet.

ST Aerospace also re-delivered 349 aircraft for airframe maintenance and modification the past quarter, and processed a total of 11,618 components, 41 landing gears and 45 engines, while conducting 1,335 engine washes for both commercial and military customers.

These developments are not expected to have any material impact on ST Engineering's consolidated net tangible assets per share or earnings per share for the current financial year.

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Indonesia's rubber output to dip next year, flat in 2015

Indonesia's rubber output is expected to ease next year due to the effects of an El Nino and haze from forest fires, the main rubber group in the world's No 2 producer said on Monday, but is seen unchanged in 2015 at 3.2 million tonnes. 

PHOTO: AFP

OCT 12, 20153:18 PM

[JAKARTA] Indonesia's rubber output is expected to ease next year due to the effects of an El Nino and haze from forest fires, the main rubber group in the world's No 2 producer said on Monday, but is seen unchanged in 2015 at 3.2 million tonnes.

Indonesia is expected to face moderate El Nino dry conditions which could strengthen from September to December, while fires on Sumatra and Kalimantan have shrouded large parts of Southeast Asia in so-called "haze".

While it was too early to give a production forecast for next year, haze conditions preventing farmers from tending their trees, a lack of sunshine and dry soil would all hinder production. "It will go down next year but we are still doing analysis,"Moenardji Soedargo, chairman at the Indonesian Rubber Association (GAPKINDO) told Reuters. "Compared to last year, 2015 is more or less unchanged." Indonesia's rubber exports were likely to fall slightly to 2.5 million tonnes this year from 2.6 million tonnes in 2014, he added, due to increased domestic demand.

Soedargo said Indonesian rubber farmers had been hit hard by low prices. Singapore and Tokyo rubber futures have fallen to levels last seen in 2009, weighed down by slower economic growth in China, the world's biggest rubber buyer. "The price level today doesn't reflect the actual fundamentals - it's been overdone," he said.

Top rubber producing countries have previously looked to support prices by introducing floor prices, export curbs or farmer subsidies, which have had limited success.

Soedargo said farmers who sold 1 kg of rubber were currently only able to buy 0.5 kg of rice, compared with around 2 kg previously, a level that had remained stable even during other downturns. "It is devastating. It should be a concern to all stakeholders," he said, adding that some farmers had started cutting down their rubber trees to sell the timber.

The loss of trees could hold back production when global activity improved, Soedargo said, particularly as Indonesian rubber trees had a lot of room to increase yields compared with other producing countries.

About 20,000 hectares of trees had been replanted this year, out of total plantings of 3.65 million hectares, as part of efforts to rejuvenate farms where trees had passed their maturity.

GAPKINDO was in talks with the government about help to fund and arrange a bigger re-planting and rejuvenation rubber package for the country.

REUTERS

    
 

Palm oil inventories in Malaysia advance to record on production

Palm oil inventories in Malaysia climbed to an all-time high in September as production of the world's most- used cooking oil stayed near a record.

PHOTO: REUTERS

OCT 12, 20153:57 PM

[KUALA LUMPUR] Palm oil inventories in Malaysia climbed to an all-time high in September as production of the world's most- used cooking oil stayed near a record.

Stockpiles expanded 5.5 per cent to 2.63 million metric tons from 2.49 million tons in August, data from the Malaysian Palm Oil Board showed Monday. The median estimate in a Bloomberg survey last week was for reserves to jump to 2.70 million tons. Inventories at the end of September surpassed the previous record in December 2012 by 910 tons.

Rising stockpiles may scuttle a bull market rally in palm oil futures as record supplies of global vegetable oils and a collapse in crude oil weaken demand for the tropical oil used in everything from cooking oil to soaps and cosmetics. The commodity rallied last month as the strongest El Nino in nearly two decades threatens dry spells across Southeast Asia where most of the crop is grown. A weak ringgit also fueled palm's rally as it made the ringgit-priced feedstock more attractive for offshore customers.

Exports rose 4.4 per cent to 1.68 million tons in September, board data show, more than the 1.62 million tons forecast in the Bloomberg survey. Robust demand from Indian buyers and the weaker ringgit may underpin palm prices, said Hiro Chai, associate director at CIMB Futures Sdn. in Kuala Lumpur.

"Exports are bigger than expected mainly because of the good Indian appetite and at the same time, Indonesia's September exports were also fantastic," Mr Chai said by phone on Monday. "We've seen quite a substantial correction and prices have reached an attractive level where people will buy on the series of good data."

Exports from Indonesia, the world's largest producer, increased 11 per cent to 2.34 million tons in September, the Indonesian Palm Oil Association said on Monday. India's palm oil imports probably rose for a ninth month, advancing 15 per cent to 800,000 tons in September from a year earlier, a Bloomberg survey showed.

Output in Malaysia totaled 1.96 million tons in September, just below estimates for 2 million tons and near the record 2.05 million tons a month ago, signaling palm trees may have entered a resting period after the peak output. Oil palm trees are at their peak production period between July and October before gradually entering a low-yielding season.

The benchmark contract on Bursa Malaysia Derivatives was at RM2,263 (US$547) a ton at 3:27 pm in Kuala Lumpur. Futures may have formed a floor at about 2,200 ringgit for the rest of the year and may rally if the Malaysian currency and production weakens, CIMB's Mr Chai said.

Malaysia and Indonesia, which together account for around 86 per cent of the world's palm oil supply, has agreed to form a council for producing countries, in efforts to cushion prices and work together to strengthen the industry. Last week Malaysia said it will minimize its imports of crude palm oil to manage high stockpiles in the country.

BLOOMBERG