KUALA LUMPUR: Hektar Real Estate Investment Trust (Hektar REIT) has registered a net profit of RM10.5 million in the second quarter ended June 2017, up marginally from RM10.4 million in the same period a year ago.
Chief executive officer Datuk Hisham Othman said the market condition has become more challenging following weak economic sentiment and recent oversupply of shopping malls in Klang Valley.
“Against this backdrop, the net property income has decreased despite being supported by a steady occupancy rate. Performance is affected by higher operating expenses and slower growth in the retail industry which is causing reversions to remain flat,’ he said.
Its net property income reached RM18 million, down by 4.5 per cent from the second quarter of last year due to higher operating expenses.
The company declared its second interim income distribution per unit (DPU) together with an advance distribution for the period of July and August 2017 of four sen per unit.
The REIT said the advance distribution is in line with the upcoming completion of the rights issue and its underlying proposed acquisition of 1Segamat Shopping Centre.
Based on the closing price of RM1.36 on June 30, the annualised DPU for the year represented a distribution yield of about 6.9 per cent. The book closing date is August 25, 2017 and payment of the distribution will be made on September 22, 2017.
Hisham said its strategy moving forward is to make the most of the current economy by carrying out asset enhancement initiatives and tenant remixing activities at its malls with aims to strengthen the position of its portfolio.
“The asset enhancement initiatives at Landmark Central, Kulim will be completed next month. Todate, 85 per cent of the new lots have already been secured with new tenants.