OUE H-Trust’s Q2 distribution beats forecast

SINGAPORE — OUE Hospitality Trust (OUE H-Trust), a stapled group comprising OUE Hospitality Real Estate Investment Trust (OUE H-REIT) and OUE Hospitality Business Trust (OUE H-BT), yesterday reported better-than-forecast distributable income for the second quarter after keeping a tight lid on expenses.

Distribution per stapled security for the April-to-June period was 1.64 cents, or 2.5 per cent above forecast, as distributable income beat expectations by 2.3 per cent at S$21.6 million, said OUE H-Trust, which made its debut on the Singapore Exchange in July last year. While gross revenue was in line with the forecast at S$28.3 million, net property income was 1.2 per cent better than expectations at S$25.2 million.

Mr Christopher Williams, chairman of the trust manager, said: “It has been a year since the listing of OUE H-Trust and we have declared total distributions of 6.22 cents since inception. Based on a unit price of 89.5 cents as of July 24, we are proud to have delivered an annualised yield of 7.6 per cent and a total return of 9.3 per cent to investors who invested at the IPO price of 88 cents per stapled security.”

OUE H-REIT’s initial asset portfolio, comprising the 1,077-room Mandarin Orchard Singapore and the adjoining Mandarin Gallery, has a portfolio value of S$1.76 billion as of Dec 31. OUE H-BT is dormant.

Mr Chong Kee Hiong, chief executive of the trust manager, said: “The ongoing renovation of 430 guest rooms at Mandarin Orchard Singapore was accelerated in the second quarter so as to enable the hotel to optimise business in the second half of the year, which typically enjoys seasonally higher hospitality demand.”

While the retail segment is experiencing some headwinds, Mandarin Gallery is expected to continue to enjoy stable income, as more than 98 per cent of the mall’s rental income comprises of fixed rent, OUE H-Trust said.