INCOME to be distributed by CapitaRetail China Trust (CRCT), a CapitaLand unit, for the fourth quarter of 2010 inched up 2 per cent to $12.97 million - from $12.72 million in Q4 2009 - as it recorded higher rental revenue from its malls.
Distribution per unit (DPU) for the October-December quarter rose 1.5 per cent to 2.07 cents from 2.04 cents a year earlier.
CRCT, which owns eight retail mall properties in China, reported better distribution even as net property income fell year-on-year. This is because for 2009, there was a net retention of income. But for 2010, it is paying out all of its distributable income.
The trust also said its performance was affected by the stronger Singapore dollar, which appreciated against the yuan in 2010.
In renminbi terms, gross revenue for Q4 2010 grew 6.3 per cent year-on- year to 153.5 million yuan (S$29.8 million) due to occupancy and rental growth in some of its malls following asset enhancement works. Net property income fell 1.4 per cent in renminbi terms to about 97 million yuan mainly due to increases in marketing and utility expenses, and higher provision for staff-related costs.
But in Sing dollar terms, CRCT's performance was worse. Gross revenue rose 1.6 per cent y-o-y to reach $30.2 million in Q4 2010. Net property income fell 6.1 per cent to $19 million.
For the whole of 2010, CRCT's total income to be distributed rose 3.1 per cent to $52.2 million. Total DPU for 2010 is 8.36 cents, an increase of about 2.7 per cent over 2009.
As at end-December 2010, CRCT's total borrowing was $402 million, while its gearing stood at 31.1 per cent.
Looking ahead, CRCT said it remains optimistic about its growth prospects in China. 'With the rapid emergence of China's middle class, increasing income levels and continuing urbanisation, consumer spending is expected to remain robust,' the trust said in a statement. 'China's strong economic growth momentum, especially when contrasted with the lacklustre growth prospects in the developed markets, will continue to entice retailers to further expand into China. CRCT, with its geographically diversified portfolio of eight malls, is well positioned to tap into China's growing consumer market.'
CRCT shares gained three cents to close at $1.27 yesterday.