Singapore Exchange Ltd (SGX)

Singapore Exchange is Asia’s leading and trusted market infrastructure, facilitating the exchange of capital and ideas to create value for people, businesses and economies. As a multi-asset exchange operating equity, fixed income and derivatives markets to the highest regulatory standards, SGX is a vertically integrated business that provides listing, trading, clearing, settlement, depository and data services.

With about 40% of listed companies and over 80% of listed bonds originating outside of Singapore as well as established linkages across the region and in Europe, SGX is Asia’s most international and connected exchange. Offering a full suite of derivatives products across Asian equity indices, commodities and currencies, SGX is the world’s most liquid international market for the benchmark equity indices of China, India, Japan and ASEAN.

As Asia’s pioneering central counterparty, SGX is globally recognised for its risk management and clearing capabilities, and was one of the first globally to adopt the Principles for Financial Market Infrastructure.

Headquartered in AAA-rated Singapore, SGX has over 800 employees including offices in Beijing, Chicago, Hong Kong, London, New York, Mumbai, San Francisco, Shanghai and Tokyo.

Asia’s leading multi-asset exchange

SGX Market Strategist, Equity & Fixed Income, Singapore Exchange Ltd (SGX)

Geoff Howie

SGX Market Strategist, Equity & Fixed Income

Equity Bottom-Up

Kwang Hee Development Oriented Self Adm / Equity Bottom-Up

Kwang Hee Development Oriented Self Adm (140910 KS)

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<ul>
<li>
Among at least 10 industrial trusts listed on SGX, the three largest by market cap are: Ascendas REIT, Mapletree Logistics Trust and Mapletree Industrial Trust. Last month, the trio unveiled their earnings for the three months ended 31 Dec 2019. 
	 </li>
	<li>
For the Dec quarter, the three trusts averaged a DPU of 2.904 Singapore cents. AREIT reported the highest DPU of 3.507 cents, followed by MIT with a DPU of 3.16 cents. The trio averaged an 8.8% YoY rise in net property income, while gross revenue gained an average 5.3% YoY. 
	 </li>
	<li>The three REITs averaged an aggregate leverage ratio of 35.6% as of the Dec quarter, compared with an average 34.1% in the Sep quarter. Over the 2019 calendar year, the trio have averaged a total return of 38.1%, bringing their 1Y and 3Y total returns to 41.7% and 94.9% respectively.</li>
</ul>
As at end-2019, Singapore listed 35 REITs, six stapled trusts and two property trusts. These trusts contributed 24% to day-to-day turnover of Singapore’s stock market over the last calendar year. In contrast, the 43 trusts maintained a combined market value of more than S$111.9 billion, representing 12% of Singapore’s stock market capitalisation of S$937.8 billion at the end of last year.

Among the S-REITs, at least 10 are engaged in the acquisition, development, ownership, management and operation of industrial properties, data centres and logistics clusters, spanning Singapore, Malaysia, Vietnam, Japan, South Korea, China, Hong Kong, Australia, US, UK, Germany, and the Netherlands.

Among these 10 industrial trusts, the three largest by market cap are: Ascendas REIT, Mapletree Logistics Trust and Mapletree Industrial Trust. Last month, the trio unveiled their earnings for the three months ended 31 December 2019.

Earnings Highlights 

For the quarter ended 31 December 2019, the three trusts averaged a distribution per unit (DPU) of 2.904 Singapore cents.

Ascendas REIT reported the highest DPU of 3.507 Singapore cents among the three, down 12.3% YoY, followed by Mapletree Industrial Trust with a DPU of 3.16 Singapore cents, up 2.9% YoY. Ascendas REIT’s YoY decline in DPU was due to an enlarged number of applicable units (8.9% increase) following its December 2019 rights issue.

The trio averaged an 8.8% YoY rise in net property income to S$124.3 million, while gross revenue gained an average 5.3% YoY to S$154.5 million.

The three REITs averaged an aggregate leverage ratio of 35.6% as of the three months ended 31 December 2019, compared with an average 34.1% in the September 2019 quarter.

Mapletree Logistics Trust and Ascendas REIT had the highest aggregate leverage ratios of 37.5% and 35.1% respectively. Interest cover for the three trusts averaged 5.7 times in the December quarter, up marginally from 5.6 times in the previous quarter. Mapletree Industrial Trust had the highest interest coverage ratio of 6.8 times in the quarter.

Dec 2019 Quarter Financial Results 
 

<table class="table table-striped"><tbody>
<tr>
<td>
			Name
			</td>
			<td>
			DPU (SG cts)
			</td>
			<td>
			YoY Chg (%)
			</td>
			<td>
			Net Property Income (S$M)
			</td>
			<td>
			YoY Chg (%)
			</td>
			<td>
			Gross Revenue (S$M)
			</td>
			<td>
			YoY Chg (%)
			</td>
		</tr>
<tr>
<td>
			ASCENDAS REIT*
			</td>
			<td>
			3.507#
			</td>
			<td>
			-12.3
			</td>
			<td>
			182.3
			</td>
			<td>
			8.5
			</td>
			<td>
			239.7
			</td>
			<td>
			5.9
			</td>
		</tr>
<tr>
<td>
			MAPLETREE LOGISTICS TRUST
			</td>
			<td>
			2.044
			</td>
			<td>
			2.1
			</td>
			<td>
			108.6
			</td>
			<td>
			4.0
			</td>
			<td>
			121.1
			</td>
			<td>
			0.3
			</td>
		</tr>
<tr>
<td>
			MAPLETREE INDUST TRUST
			</td>
			<td>
			3.160
			</td>
			<td>
			2.9
			</td>
			<td>
			81.9
			</td>
			<td>
			14.0
			</td>
			<td>
			102.6
			</td>
			<td>
			9.7
			</td>
		</tr>
<tr>
<td>
			Average
			</td>
			<td>
			2.904
			</td>
			<td>
			-2.4
			</td>
			<td>
			124.3
			</td>
			<td>
			8.8
			</td>
			<td>
			154.5
			</td>
			<td>
			5.3
			</td>
		</tr>
</tbody></table>
*comparing 3Q FY2019 to 3Q FY18/19 as AREIT changed its FY end to 31 Dec from 31 March in July 2019

#current qtr’s DPU incl. taxable, tax exempt and capital distributions of 2.956, 0.130 and 0.421 cts respectively, with approx 3.6 bln applicable units for DPU computation; year-ago qtr incl. taxable and capital distributions of 3.456 and 0.542 cts respectively with approx 3.1 bln applicable units for DPU computation

<table class="table table-striped"><tbody>
<tr>
<td>
			Name
			</td>
			<td>
			Aggregate Leverage Ratio (%) as at 31 Dec 2019
			</td>
			<td>
			Aggregate Leverage Ratio (%) as at 30 Sep 2019
			</td>
			<td>
			Interest Coverage Ratio (x) as at 31 Dec 2019
			</td>
			<td>
			Interest Coverage Ratio (x) as at 30 Sep 2019
			</td>
		</tr>
<tr>
<td>
			ASCENDAS REIT
			</td>
			<td>
			35.1
			</td>
			<td>
			36.2
			</td>
			<td>
			5.1
			</td>
			<td>
			5.3
			</td>
		</tr>
<tr>
<td>
			MAPLETREE LOGISTICS TRUST
			</td>
			<td>
			37.5
			</td>
			<td>
			37.0
			</td>
			<td>
			5.2
			</td>
			<td>
			5.0
			</td>
		</tr>
<tr>
<td>
			MAPLETREE INDUST TRUST
			</td>
			<td>
			34.1
			</td>
			<td>
			29.2
			</td>
			<td>
			6.8
			</td>
			<td>
			6.6
			</td>
		</tr>
<tr>
<td>
			Average
			</td>
			<td>
			35.6
			</td>
			<td>
			34.1
			</td>
			<td>
			5.7
			</td>
			<td>
			5.6
			</td>
		</tr>
</tbody></table>
Source: Company data

Outlook

<ul>
<li>
Ascendas REIT

	<ul>
<li>Although several economists expect global growth to recover modestly in 2020, downside risks from trade and economic policy uncertainties remain. The recent outbreak of the novel coronavirus has created a new element of uncertainty. 
		 </li>
		<li>In 2020, we can look forward to a full year’s contribution from the new US and Singapore properties. 
		 </li>
		<li>We will continue to invest in well-located properties that benefit from structural growth trends, such as technology and e-commerce, and strengthen A-REIT’s presence across its four developed markets to optimise portfolio returns.</li>
	</ul>
</li>
</ul>
Click <a href="https://links.sgx.com/FileOpen/1%20Ascendas%20Reit%20Press%20Release_FY2019.ashx?App=Announcement&amp;FileID=594960">here</a> for full results release.

<ul>
<li>
Mapletree Logistics Trust 

	<ul>
<li>Amidst continued geopolitical uncertainties and economic headwinds, MLT’s customers remain cautious about renewals and expansion, with some looking to consolidate their operations to improve cost and operational efficiencies. This may have a negative impact on demand for warehouse space. 
		 </li>
		<li>As a portfolio, overall occupancies for MLT’s logistics facilities have stayed relatively resilient at 97.7%, while rental rates have been stable to-date. The Manager will continue to focus on tenant retention and actively managing leases due for expiry. 
		 </li>
		<li>During the quarter, the acquisition of seven logistics properties was completed. They will make their full contribution to MLT’s distribution in the coming quarter.</li>
	</ul>
</li>
</ul>
Click <a href="https://links.sgx.com/FileOpen/20200120_MLT_3QFY1920_PR_final.ashx?App=Announcement&amp;FileID=593823">here</a> for full results release.

<ul>
<li>
Mapletree Industrial Trust  
	 
	<ul>
<li>The completion of the acquisition of 13 data centres in North America will position MIT to capture opportunities in the fast-growing data centre sector. We will continue to actively pursue investment opportunities to enhance the quality of the portfolio. 
		 </li>
		<li>Based on Singapore Commercial Credit Bureau’s Business Optimism Index study, business confidence rose slightly for the first quarter of 2020, after reaching a near two-year low for the fourth quarter of 2019. A softer outlook is projected for the manufacturing and construction sectors in the coming months.</li>
	</ul>
</li>
</ul>
Click <a href="https://links.sgx.com/FileOpen/20200121_3QFY19%20Results_Press%20Release.ashx?App=Announcement&amp;FileID=593991">here</a> for full results release. 
 

YTD Performances

SGX’s three largest industrial trusts have a combined market cap of nearly S$25 billion. Over the 2019 calendar year, the trio averaged a total return of 38.1%, bringing their YTD, one-year and three year total returns to 10.5%, 41.7% and 94.9% respectively.

 
The table below details SGX’s three largest industrial REITs, sorted by market cap.

<table class="table table-striped"><tbody>
<tr>
<td>
			Name
			</td>
			<td>
			SGX Code
			</td>
			<td>
			Market Cap (S$M)
			</td>
			<td>
			Total Return 2019 (%)
			</td>
			<td>
			Total Return YTD (%)
			</td>
			<td>
			Total Return 1Y (%)
			</td>
			<td>
			Total Return 3Y (%)
			</td>
		</tr>
<tr>
<td>
			ASCENDAS REIT
			</td>
			<td>
			A17U
			</td>
			<td>
			11,470
			</td>
			<td>
			24.3
			</td>
			<td>
			10.1
			</td>
			<td>
			29.7
			</td>
			<td>
			60.1
			</td>
		</tr>
<tr>
<td>
			MAPLETREE LOGISTICS TRUST
			</td>
			<td>
			M44U
			</td>
			<td>
			7,025
			</td>
			<td>
			46.2
			</td>
			<td>
			9.4
			</td>
			<td>
			42.9
			</td>
			<td>
			115.0
			</td>
		</tr>
<tr>
<td>
			MAPLETREE INDUST TRUST
			</td>
			<td>
			ME8U
			</td>
			<td>
			6,273
			</td>
			<td>
			43.9
			</td>
			<td>
			12.1
			</td>
			<td>
			52.5
			</td>
			<td>
			109.6
			</td>
		</tr>
<tr>
<td>
			Average
			</td>
			<td>
			 
			</td>
			<td>
			 
			</td>
			<td>
			38.1
			</td>
			<td>
			10.5
			</td>
			<td>
			41.7
			</td>
			<td>
			94.9
			</td>
		</tr>
</tbody></table>
 Source: Bloomberg &amp; StockFacts (data as of 5 Feb 20)
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Among at least 10 industrial trusts listed on SGX, the three largest by market cap are: Ascendas REIT, Mapletree Logistics Trust and Mapletree Industrial Trust. Last month, the trio unveiled their earnings for the three months ended 31 Dec 2019. 
	 
	
For the Dec quarter, the three trusts averaged a DPU of 2.904 Singapore cents. AREIT reported the highest DPU of 3.507 cents, followed by MIT with a DPU of 3.16 cents. The trio averaged an 8.8% YoY rise in net property income, while gross revenue gained an average 5.3% YoY. 
	 
	The three REITs averaged an aggregate leverage ratio of 35.6% as of the Dec quarter, compared with an average 34.1% in the Sep quarter. Over the 2019 calendar year, the trio have averaged a total return of 38.1%, bringing their 1Y and 3Y total returns to 41.7% and 94.9% respectively.

As at end-2019, Singapore listed 35 REITs, six stapled trusts and two property trusts. These trusts contributed 24% to day-to-day turnover of Singapore’s stock market over the last calendar year. In contrast, the 43 trusts maintained a combined market value of more than S$111.9 billion, representing 12% of Singapore’s stock market capitalisation of S$937.8 billion at the end of last year.

Among the S-REITs, at least 10 are engaged in the acquisition, development, ownership, management and operation of industrial properties, data centres and logistics clusters, spanning Singapore, Malaysia, Vietnam, Japan, South Korea, China, Hong Kong, Australia, US, UK, Germany, and the Netherlands.

Among these 10 industrial trusts, the three largest by market cap are: Ascendas REIT, Mapletree Logistics Trust and Mapletree Industrial Trust. Last month, the trio unveiled their earnings for the three months ended 31 December 2019.

Earnings Highlights 

For the quarter ended 31 December 2019, the three trusts averaged a distribution per unit (DPU) of 2.904 Singapore cents.

Ascendas REIT reported the highest DPU of 3.507 Singapore cents among the three, down 12.3% YoY, followed by Mapletree Industrial Trust with a DPU of 3.16 Singapore cents, up 2.9% YoY. Ascendas REIT’s YoY decline in DPU was due to an enlarged number of applicable units (8.9% increase) following its December 2019 rights issue.

The trio averaged an 8.8% YoY rise in net property income to S$124.3 million, while gross revenue gained an average 5.3% YoY to S$154.5 million.

The three REITs averaged an aggregate leverage ratio of 35.6% as of the three months ended 31 December 2019, compared with an average 34.1% in the September 2019 quarter.

Mapletree Logistics Trust and Ascendas REIT had the highest aggregate leverage ratios of 37.5% and 35.1% respectively. Interest cover for the three trusts averaged 5.7 times in the December quarter, up marginally from 5.6 times in the previous quarter. Mapletree Industrial Trust had the highest interest coverage ratio of 6.8 times in the quarter.

Dec 2019 Quarter Financial Results 
 




			Name
			
			
			DPU (SG cts)
			
			
			YoY Chg (%)
			
			
			Net Property Income (S$M)
			
			
			YoY Chg (%)
			
			
			Gross Revenue (S$M)
			
			
			YoY Chg (%)
			
		


			ASCENDAS REIT*
			
			
			3.507#
			
			
			-12.3
			
			
			182.3
			
			
			8.5
			
			
			239.7
			
			
			5.9
			
		


			MAPLETREE LOGISTICS TRUST
			
			
			2.044
			
			
			2.1
			
			
			108.6
			
			
			4.0
			
			
			121.1
			
			
			0.3
			
		


			MAPLETREE INDUST TRUST
			
			
			3.160
			
			
			2.9
			
			
			81.9
			
			
			14.0
			
			
			102.6
			
			
			9.7
			
		


			Average
			
			
			2.904
			
			
			-2.4
			
			
			124.3
			
			
			8.8
			
			
			154.5
			
			
			5.3
			
		

*comparing 3Q FY2019 to 3Q FY18/19 as AREIT changed its FY end to 31 Dec from 31 March in July 2019

#current qtr’s DPU incl. taxable, tax exempt and capital distributions of 2.956, 0.130 and 0.421 cts respectively, with approx 3.6 bln applicable units for DPU computation; year-ago qtr incl. taxable and capital distributions of 3.456 and 0.542 cts respectively with approx 3.1 bln applicable units for DPU computation




			Name
			
			
			Aggregate Leverage Ratio (%) as at 31 Dec 2019
			
			
			Aggregate Leverage Ratio (%) as at 30 Sep 2019
			
			
			Interest Coverage Ratio (x) as at 31 Dec 2019
			
			
			Interest Coverage Ratio (x) as at 30 Sep 2019
			
		


			ASCENDAS REIT
			
			
			35.1
			
			
			36.2
			
			
			5.1
			
			
			5.3
			
		


			MAPLETREE LOGISTICS TRUST
			
			
			37.5
			
			
			37.0
			
			
			5.2
			
			
			5.0
			
		


			MAPLETREE INDUST TRUST
			
			
			34.1
			
			
			29.2
			
			
			6.8
			
			
			6.6
			
		


			Average
			
			
			35.6
			
			
			34.1
			
			
			5.7
			
			
			5.6
			
		

Source: Company data

Outlook



Ascendas REIT

	
Although several economists expect global growth to recover modestly in 2020, downside risks from trade and economic policy uncertainties remain. The recent outbreak of the novel coronavirus has created a new element of uncertainty. 
		 
		In 2020, we can look forward to a full year’s contribution from the new US and Singapore properties. 
		 
		We will continue to invest in well-located properties that benefit from structural growth trends, such as technology and e-commerce, and strengthen A-REIT’s presence across its four developed markets to optimise portfolio returns.
	


Click here for full results release.



Mapletree Logistics Trust 

	
Amidst continued geopolitical uncertainties and economic headwinds, MLT’s customers remain cautious about renewals and expansion, with some looking to consolidate their operations to improve cost and operational efficiencies. This may have a negative impact on demand for warehouse space. 
		 
		As a portfolio, overall occupancies for MLT’s logistics facilities have stayed relatively resilient at 97.7%, while rental rates have been stable to-date. The Manager will continue to focus on tenant retention and actively managing leases due for expiry. 
		 
		During the quarter, the acquisition of seven logistics properties was completed. They will make their full contribution to MLT’s distribution in the coming quarter.
	


Click here for full results release.



Mapletree Industrial Trust  
	 
	
The completion of the acquisition of 13 data centres in North America will position MIT to capture opportunities in the fast-growing data centre sector. We will continue to actively pursue investment opportunities to enhance the quality of the portfolio. 
		 
		Based on Singapore Commercial Credit Bureau’s Business Optimism Index study, business confidence rose slightly for the first quarter of 2020, after reaching a near two-year low for the fourth quarter of 2019. A softer outlook is projected for the manufacturing and construction sectors in the coming months.
	


Click here for full results release. 
 

YTD Performances

SGX’s three largest industrial trusts have a combined market cap of nearly S$25 billion. Over the 2019 calendar year, the trio averaged a total return of 38.1%, bringing their YTD, one-year and three year total returns to 10.5%, 41.7% and 94.9% respectively.

 
The table below details SGX’s three largest industrial REITs, sorted by market cap.




			Name
			
			
			SGX Code
			
			
			Market Cap (S$M)
			
			
			Total Return 2019 (%)
			
			
			Total Return YTD (%)
			
			
			Total Return 1Y (%)
			
			
			Total Return 3Y (%)
			
		


			ASCENDAS REIT
			
			
			A17U
			
			
			11,470
			
			
			24.3
			
			
			10.1
			
			
			29.7
			
			
			60.1
			
		


			MAPLETREE LOGISTICS TRUST
			
			
			M44U
			
			
			7,025
			
			
			46.2
			
			
			9.4
			
			
			42.9
			
			
			115.0
			
		


			MAPLETREE INDUST TRUST
			
			
			ME8U
			
			
			6,273
			
			
			43.9
			
			
			12.1
			
			
			52.5
			
			
			109.6
			
		


			Average
			
			
			 
			
			
			 
			
			
			38.1
			
			
			10.5
			
			
			41.7
			
			
			94.9
			
		

 Source: Bloomberg &amp; StockFacts (data as of 5 Feb 20)



December Quarter Earnings of SGX’s Largest Industrial REITs