Higher average occupancy rate lifts KIP REIT’s 4Q earnings

The group remains cautious for the coming quarter and will continue to practice fiscal prudence and implement credit control measures 


KIP Real Estate Investment Trust (REIT) posted a net profit of RM9.27 million for its fourth quarter ended June 30, 2021 (4Q21), compared to a net loss of RM5 million in the same period last year. 

Its 4Q21 revenue has increased by 14.8% year-on-year to RM19.4 million against RM16.9 million last year, mainly due to 4Q20 was after amortisation of rental rebate of RM1.4 million for Movement Control Order 1.0 besides higher average occupancy rate in 4Q21, according to a filing to Bursa Malaysia yesterday. 

Its net property income grew to RM15.08 million from RM13.23 million in the corresponding quarter of last year in tandem with better revenue.

“The retail sector continues to be adversely impacted by restrictions with tenants in non-essential trades being prohibited from operating during this period. The Retail Group Malaysia has projected a 0.1% decline from 4.1% growth rate in retail,” KIP REIT said in the filing. 

The group stated that it remains cautious for the coming quarter and will continue to practice fiscal prudence and implement credit control measures. 

“The manager will also continue to evaluate opportunities for growth and diversification into different asset classes in commercial and industrial assets,” the company added. 

In a statement, KIP REIT Management Sdn Bhd ED Datuk Eric Ong Kook Liong said the company continues to exercise prudent cost management and leveraging its strengths in the management of KIP REIT’s properties in these current predicaments in the retail industry. 

“KIP REIT’s business fundamentals remain strong and have proven to be resilient in uncertain times,” he said. 

The group’s current quarter income available for distribution was 35.8% higher than the preceding year corresponding quarter on the back of better-realised pro- fit before tax. 

The investment properties in the southern region, central region and northern region contributed 49%, 28.2% and 22.8% of the group’s total revenue respectively. 

Total revenue for year-to-date June 30, 2021, was RM74.3 million, at a 0.4% shortfall against the preceding year-to-date performance. 

In a separate filing, the group announced a final income distribution of 2.1 sen per unit for 4Q21, amounting to RM10.6 million, payable on Aug 27, 2021. 

KIP REIT shares closed unchanged at 85 sen yesterday, valuing the company RM429.51 million.