Back 29 Apr 2025

First REIT 1Q 2025 Business Update: DPU Declines Amidst Currency Depreciation

Link: https://links.sgx.com/1.0.0/corporate-announcements/2HL3A82QJW2QSJQR/a397ef9406f46120c6a97eeea23dd32832a81afc2a900b61adbb7582d8c11148

Summary:

  • First Real Estate Investment Trust (“First REIT”) has released its business update for the first quarter ended March 31, 2025, reporting a distribution per unit (“DPU”) of 0.58 Singapore cent for the quarter, payable on June 26, 2025.
  • Rental and Other Income decreased by 2.8% year-on-year to S$25.4 million in 1Q 2025, while Net Property and Other Income also fell by 2.8% year-on-year to S$24.6 million.
  • This decrease was primarily attributed to the depreciation of the Indonesian Rupiah and Japanese Yen against the Singapore Dollar, although partially offset by higher rental income from properties in Indonesia and Singapore.
  • The Distributable Amount declined by 2.2% year-on-year to S$12.2 million in 1Q 2025.
  • The DPU decreased from 0.60 Singapore cent in 1Q 2024 to 0.58 Singapore cent in 1Q 2025, mainly due to foreign currency depreciation and an enlarged unit base resulting from the issuance of units for management fee payments.
  • As of March 31, 2025, 56.7% of the debt portfolio was either on fixed rates or hedged. The gearing ratio slightly increased to 40.7%, with an interest coverage ratio of 3.8 times. The cost of debt decreased from 5.0% in 1Q 2024 to 4.7% in 1Q 2025, and First REIT has no refinancing requirements until May 2026.
  • The net asset value per unit as of March 31, 2025, was 27.37 Singapore cents, down from 28.60 Singapore cents as of December 31, 2024, largely due to the depreciation of foreign currencies against the Singapore Dollar.
  • As of March 31, 2025, rental outstanding from PT MPU was approximately S$5.8 million.
  • The Board is currently conducting a Strategic Review to evaluate all potential options for First REIT's business, including possible joint ventures, partnerships, and asset acquisitions or divestments.
  • The report references the OECD Global Debt Report 2025, which indicates an uncertain outlook for global debt markets influenced by macro-economic uncertainties, geopolitical risk, and international economic policy.