KIP Real Estate Investment Trust’s (KIP REIT) net property income (NPI) rose by 10.7% from RM15.2 million to RM16.8 million for the second quarter ended 31 December 2023 (Q2FY2024).
“Meanwhile, its profit after tax (PAT) in turn grew 31% to RM10.6 million against Q2FY2023’s RM8.1 million and correspondingly, income available for distribution was RM10.9 million, up by 30.6%.
“The improved PAT was primarily attributed to the contribution from the three industrial properties and higher occupancy rate for retail spaces,” it said in a statement today.
For the quarter under review, KIP REIT delivered gross revenue of RM22.6 million, 12% higher as compared to RM20.2 million in the preceding year’s corresponding quarter.
“Of this RM22.6 million, the investment properties for the retail segment accounted for 94.3% while the industrial segment contributed 5.7%.
“For the retail segment, the southern region continued to be the highest revenue contributor. The revenue grew by 5.3% to RM10.4 million, equivalent to 49% of the segment’s revenue.
Revenue from the central region increased 15.6% to RM6.4 million, 29.8% of the segment’s revenue. KIP REIT’s AEON Mall Kinta City in the northern region registered RM4.5 million or 21.2% of the segment’s revenue.
On a cumulative 6 months basis, KIP REIT’s NPI and PAT improved by 12.9% and 24.3% respectively to RM33.3 million and RM21 million
Meanwhile, its registered an increase of 13.7% in gross revenue to RM45 million, in comparison to the same period previous year’s of RM39.5 million.
KIP REIT chief executive officer Valerie Ong Pui Shan said she is pleased with the financial performance being the best second quarter ever.
“Year to date, our average occupancy rate continues to be over 90%, which exhibits the attractiveness of our properties and our capability to attract the right mix of shoppers and tenants.”
On another note, Ong expressed her excitement to share that the proposed acquisition of KIPMall Kota Warisan is on track, where all the conditions set out in the sale and purchase agreement with Cahaya Serijaya Sdn Bhd have been fulfilled.
“Barring any unforeseen circumstances, we are hopeful that the acquisition will be completed by the first quarter of 2024. This acquisition will be a valuable addition to our retail investment properties portfolio which will further solidify our position as a REIT player.
“Upon completion of the acquisition, our total net lettable area will increase by approximately 10%. We are cautiously optimistic to sustain a stable financial performance throughout this financial year as we continue to assess growth opportunities in the market,” she added/
The manager of KIP REIT has proposed a second income distribution of RM9.6 million, translating to 1.55 sen per unit, which includes a non-taxable portion of approximately 0.70 sen per unit derived from capital allowances and tax-exempt income which is not subject to tax.
The book closure date is fixed for 13 February 2024 and payment of the proposed income distribution will be made on 29 February 2024.
Based on the closing price of RM0.885 on 29 January 2024, the trailing twelve months distribution per unit (DPU) gives a yield of approximately 7.2%.
