Ascott Residence’s Q2 DPU drops 18% on-year

Mainboard-listed Ascott Residence Trust announced on Thursday that its distribution per unit (DPU) for the second quarter stood at 1.79 cents. That is 18 per cent lower than the 2.19 cents reported over the same period last year.

For the three months ended in June, the total amount distributable to unitholders was S$11 million, 17 per cent lower than last year’s S$13.3 million.

Revenue decreased by seven per cent to S$43 million, while gross profit dropped 11 per cent to S$20.8 million in the second quarter.

Ascott Residence said the decrease in operating performance was mainly due to weaker demand of serviced residences in Singapore and China as a result of the global recession.

Increased competition from new supply in Beijing and Shanghai also led to weaker demand.

Meanwhile, finance costs rose by 26 per cent on the back of higher interest rates and additional bank loans for the acquisition of property.

Ascott Residence’s CEO Chong Kee Hiong said operating performance has improved over the first quarter and that there are signs of stabilization in the second half of the year.

Source : Channel NewsAsia – 23 Jul 2009

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