First REIT reports 2021 net property and other income rose 29 percent

Comprehensive Cancer Centre, in Central Jakarta, Indonesia, is part of First REIT's portfolio. Photo used with permission of OUE Lippo Healthcare.Comprehensive Cancer Centre, in Central Jakarta, Indonesia, is part of First REIT's portfolio. Photo used with permission of OUE Lippo Healthcare.

First REIT reported late Thursday its 2021 net property and other income grew 29.4 percent on-year to S$100.22 million, largely on an accounting treatment change for rental escalations in leases. 

Rental and other income for the full year increased 28.5 percent on-year to S$102.35 million, the REIT said in a filing to SGX. 

The distribution per unit (DPU) for the full year was 2.61 Singapore cents, down 37.1 percent from 4.15 Singapore cents in 2020, the filing said. The decline was due to the issuance of 791.06 million rights units in February 2021, First REIT said. If the new units were excluded, the full-year DPU would have been 5.12 Singapore cents, the filing said.

The amount available for distribution rose 26.1 percent on-year to S$42.12 million in 2021, the REIT said.

“In a year of structural adjustments to our leases and continued challenges from the pandemic, we are heartened to have achieved a stable set of results for FY2021. At the same time, the support of our
steadfast unitholders to all our strategic initiatives, and together with our committed sponsor, have
enabled the trust to maximise returns for our unitholders to deliver total unitholder returns of 59.0 percent, and a 42.8 percent increase in unit price for FY2021,” Victor Tan, CEO of the REIT’s manager, said in the statement.

For the six months ended 31 December, First REIT reported net property and other income rose 56.8 percent on-year to S$62.60 million on rental and other income of S$63.41 million, up 54.6 percent on-year.

The second half DPU was 1.31 Singapore cents, down 29.2 percent from 1.85 Singapore cents in the year-ago period, the filing said. The decline was due to the issuance of 791.06 million rights units in February 2021, First REIT said. If the new units were excluded, the second half DPU would have been 2.56 Singapore cents, the filing said.

Outlook

In its outlook, First REIT noted Indonesia’s economy has shown signs of recovery, but that the outlook remains clouded by rising Covid-19 case numbers, falling commodity prices and tighter monetary and fiscal stimulus.

“In view of the evolving situation of the pandemic, First REIT’s assets continue to operate under strict precautionary measures while the hospitals operated under PT Siloam International Hospitals Tbk are contributing to Indonesia’s fight against the pandemic through the provision of testing services and
healthcare professionals to assist in vaccination,” the REIT said. 

“Overall, private healthcare demand continues to remain supported over the long term and First REIT will continue to seek accretive prospects from its strong network of healthcare assets from its sponsor group, comprising OUE Limited and OUELH, and also assets from third parties within and outside Asia to boost future growth,” the REIT said. 

In addition, First REIT noted that its foray into the Japan nursing home market was likely to see continued demand as the country becomes a “super-aged” nation amid projections around 35.5 percent of its population will be over the age of 65 by 2040. 

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