Maple Greater China Commercial Trust (MGCCT) Q3 FY16/17

Gearing

1. Gearing increased to 40.5% mainly due to higher translated borrowings partially offset by higher translated investment properties
2. Reduction in average all-in cost of debt to 2.78% due to better refinancing terms from the new bank facilities as compared to expiring IPO debt
3. No debt for 2017 to be refinance and left with HK$510M to be refinance in Mar 18, which is good as it will have less impact to interest rate hike if any
4. The management also provide guidance any increase of 50bps in interest rate may result in reduction in DPU by an estimate of 0.014 cents based on based on 2,786,644,330 units as of 31 Dec 2016 and the proportion of fixed-rate debt remains unchanged at about 85%
5. Group total liabilities amounted to S$2,845.0 million as of 31 December 2016, and was S$107.6 million higher compared to 31 March 2016. The increase in total liabilities was mainly due to higher translated borrowings of S$65.2 million as a result of HKD appreciation at period end, and additional loan drawn down for distribution payment to Unitholders

Lease Expiry

For FY16/17, The management has manage to have positive rental revision for 8.5% lease renewed and the rate seem it will continue for the remaining 6.4% lease to expired for Q4 FY16/17.

As for the FY17/18, One of the tenant has extended the lease and this reduced the expiry lease from 36.9% to 28.9%.

Festival Walk

Drop in the Tenant sales, however for Festival Walk the majority of the rent is derived mainly from a fixed rental base, with a smaller contribution from variable turnover rent.

Future Acquisition

There is a potential acquisition in 2018 on-ward as the sponsor new office building will be ready, depend on when it will dump into MGCCT.

Dividend

After the drop due to property tax and vat impact, the DPU has growth 1% compare to Q2FY16/17. We can look forward if management can maintain the current rental reversion for FY17/18 as it will have about 28.9% lease to expired.