Ascott Residence Trust’s (Ascott Reit) distributable income for Q1 plummets to a 23 percent annual drop, from $14.2m to $10.8m, the group declared.
This drop is 24 percent in terms of distribution per unit (DPU), from 2.33 cents in last year’s first quarter to 1.77 cents.
Ascott Reit did not declare distribution for the first quarter as the group manages distribution to its unitholders on a semiannual basis.
A drop of 16 percent to $19.9m in gross profit was recorded in the current quarter, while there was an 8 percent to $42.1m fall in revenue.
The lower revenue was attributed to the lower demand for serviced residences in Singapore and China, together with the increased competition in Shanghai and Beijing.
A 27 percent hit in revenue – from $9.2m to $6.7m year-on-year – was taken by Ascott Reit’s serviced residences in Singapore, with revenue per available unit (RevPAU) plunging 33 percent – from $251 to $169 year-on-year.
“This decrease was due to lower occupancy as a result of reduction in demand from business travellers”, Ascott Reit said the previous day. “However, the performance of Indonesia, Vietnam, and the rental housing business in Japan continues to be relatively stable”, said Ascott Residence Trust Management CEO Chong Kee Hiong.
Ascott Reit also anticipates a maximum of $96m for refinancing by the end of the year. The group has already started talks with banks in order to secure refinancing prior to maturity, said Mr. Chong.
Though Ascott Reit remains optimistic that they will be productive for 2009, it is believed that this year’s operating profit will be lower than the previous year.
The counter closed the previous day at 46.5 cents.