LMIRT Management, the manager of Lippo Malls Indonesia Retail Trust (LMIR Trust), reported the trust achieved Net Property Income of $30.7 million in the three months ended June 30, 2012 (2Q2012).
This is an increase of 36.2% from $22.6 million in 2Q2011, notwithstanding an $4.5 million increase in property operating expenses as a result of the acquisition of Pluit Village and Plaza Medan Fair.
Distributable income increased by 44.3%, compared to 2Q2011, to $17.1 million, which translate into a distribution per unit (DPU) of 0.79 cents in 2Q2012. This represents an annualised DPU yield of 7.4% based on the closing price of $0.40 per unit on June 30, 2012.
As at June 30, 2012, LMIR Trust’s outstanding debt was $147.5 million with an interest margin of 4.0% per annum over the base lending rate. LMIR Trust has a gearing level of 9.3% with no refinancing required until June 2014 and its interest cover ratio stood at a robust 11.4 times. Furthermore, $869 million (or 60% of LMIR Trust’s $1.44 billion asset portfolio) remains unencumbered.
Looking long term, robust macroeconomic fundamentals, an enticing demographic profile and the spread of organised retail underpin a highly dynamic consumer growth story in Indonesia. This is expected to have a positive impact on the demand for quality retail space.
Jakarta remains under-shopped as its retail density at 0.4 sqm per person is one of the lowest in the region, compared to 0.7 sqm per person in Singapore and 2.7 sqm per person in Kuala Lumpur.
With only 140,000 sqm of new retail space expected to be delivered in 2012, LMIR Trust’s retail malls are well positioned to benefit from the attractive dynamics of the Indonesian retail mall industry.
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