CDL Hospitality Trust (CDLHT) ended 2011 on a strong note. Fourth quarter 2011 revenue was $37.8 million (+13.4 per cent year-on- year), net property income was $35.5 million (12.7 per cent year- on-year), distributable income after deducting retained income was $28.4 million (6.6 per cent year-on- year) and DPU was 2.94 cents (5.8 per cent year-on- year).
For the whole year, DPU totalled 11.05 cents, forming 98 per cent of our DPU estimates and 8.3 per cent higher than 2010 (10.21 cents).
The remarkable FY2011 result was mainly due to organic growth across the Singapore and overseas hotels portfolio with the best Q3 and Q4 RevPAR (excluding Studio M Hotel) recorded in 2011 since IPO.
One-off property tax refund of $3.3 million, contribution from Studio M Hotel in Q211, and additional variable income of $0.84 million recognised in Q1 2011 from Australia hotels were also part of the attributing factors. It is undeniable that CDLHT has turned in a stellar performance in FY2011.
However, given the impact of global economic slowdown, moderation of RevPAR is in sight where AOR (average occupancy rate) is expected to fall first, followed by the ADR (average daily rate) regardless of the seasonal effect.Our target price increased to $1.53. On a risk- reward basis, we maintain our 'neutral' recommendation.
NEUTRAL
NEUTRAL
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