Hektar Asset Management chief executive officer Johari Shukri Jamil
KUALA LUMPUR: Hektar Real Estate Investment Trust
(Hektar REIT) remains cautious about the 2024 outlook due to the volatile economic landscape driven by hawkish monetary policy, uncertain consumer sentiments, and lingering supply-chain issues from geopolitical concerns.
“We will continue adopting prudent financial management, cost optimisation and enhancing our asset efficiencies to help cushion the impact.
“Despite the concerns, Hektar REIT remains positive and resilient in achieving growth backed by increased occupancy rates for properties under the portfolio,” Hektar REIT said in the notes accompanying its financial results.
Hektar REIT’s net profit fell 36.1% to RM26.07mil, or earnings per share of 5.22 sen against RM40.8mil, or 8.66 sen in the same quarter last year, mainly
It recorded a revenue of RM27.53mil in the fourth quarter ended Dec 31, 2023 (4Q23) compared with RM27.9mil last year.
For the current quarter, its net property income margin improved by 14.7% or RM3.91mil compared with the 4Q22 due to the commitment of the manager, Hektar Asset Management Sdn Bhd to the group-wide cost optimisation program initiated in mitigating the impact of rising utilities costs since the second half of 2022.
For the full year, Hektar REIT registered a revenue of RM111.5mil, compared to the RM117.5mil achieved the previous year.
Despite the marginal dip in revenue, the NPI of RM60mil recorded was higher by 2% than the preceding year.
It said the results are primarily due to the ongoing repositioning and tenancy remixing strategies being undertaken at Subang Parade and the extensive cost optimisation efforts undertaken throughout the year.
Hektar REIT declared a total of 5.0 sen income distribution per unit (DPU) for FY2023. Based on the closing price of RM0.65 on Dec 29, the annualised DPU for the year represented a distribution yield of 7.7%.
In FY23, Hektar REIT experienced significant growth in its overall portfolio occupancy, achieving an impressive 86.7%.
“Every property within our portfolio displayed robust performance, with Mahkota Parade boasting a 94% occupancy rate, Kulim Central achieving nearly 97%, and Wetex Parade nearing 98%,” it said in a statement.
Hektar Asset Management chief executive officer Johari Shukri Jamil said: “With our enhanced occupancy rates, positive rental reversions, and diligent financial management, we are poised to continue our growth trajectory. Our ongoing efforts to deliver sustainable value to our unitholders and enrich the community-centric experiences at our malls remain our top priority.”
Hektar REIT has decided to pursue asset portfolio diversification, and in January 2024, Hektar REIT’s unitholders approved the amendment to the REIT’s investment objectives to include investments in real estate from other asset classes beyond retail.
“With a target of having at least 20% of the portfolio to consist of non-retail assets in the next five years, the portfolio diversification strategy is poised to further strengthen the portfolio’s resilience to economic cycles, enabling Hektar REIT to deliver consistent returns to our unitholders.
“Upon completion of the proposed acquisition of Kolej Yayasan Saad Melaka, Hektar REIT’s assets under management (AUM) size will be RM1.38bil,” it said.
