Parkway Life Reit posts 2.8% higher Q3 DPU of S$0.1130

PARKWAY Life Reit on Wednesday (Oct 16) reported a 2.8 per cent rise in distribution per unit (DPU) to S$0.1130 for the third quarter of 2024, up from S$0.1099 in the year-ago period.

The increase came despite a 2.1 per cent year-on-year decline in net property income (NPI) to S$102.4 million, which was primarily due to the depreciation of the Japanese yen.

The depreciation impacted earnings from its Japanese assets, which comprise 60 nursing home properties in the country.

The healthcare-focused real estate investment trust (Reit) pays distributions semi-annually, with the Q3 DPU contributing to its payout for the second half of the financial year.

For the three months ended Sep 30, gross revenue stood at S$108.5 million, a 2.2 per cent fall from S$110.9 million a year earlier.

The declines in gross revenue and NPI were offset by contributions from a nursing home acquired in August 2024, along with two nursing homes acquired in October 2023, the Reit’s manager said in a bourse filing.

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“As the Reit has hedged the net income from Japan, the drop in revenue will be compensated by the FX gains from the settlement of the forward contracts,” the manager said.

In July, it announced the acquisition of a nursing home property in Osaka for 2.4 billion yen (S$20.7 million).

Finance costs increased by 7.7 per cent year on year to S$8.3 million, due mainly to the funding of capital expenditures and new acquisitions in 2023 and 2024, as well as higher interest costs from both Singapore dollar and Japanese yen debts.

As at Sep 30, the all-in debt cost stood at 1.36 per cent, with a gearing ratio of 37.5 per cent and an interest cover of 10.2 times.

Units of Parkway Life Reit closed flat at S$4.02 on Wednesday, prior to the announcement.