Amfirst REIT was listed on 21 December 2006 with an initial portfolio of 4 properties valued at RM 487.0 million. 10 years after its IPO listing, Amfirst REIT has enlarged its portfolio to 9 properties valued at RM 1.7 billion as at 31 March 2017. In this article, I’ll list down 9 quick facts about Amfirst REIT before you invest.
#1: Stock Symbol
Ticker Symbol: KLSE: AMFIRST / KLSE: 5120
Market Capitalization: RM 463.3 Million (2 January 2018)
Share Price: RM 0.675 (2 January 2018)
Syariah Compliant: Nope
#2: The Business
In 2017, Amfirst REIT derives income mainly from these properties:
- The Summit Subang USJ
The Summit Subang USJ is an integrated development that consists of a 13-storey office tower, 6-storey retail podium, and a 4-star hotel located in USJ 1, Subang Jaya. In 2017, this property is valued at RM 384.2 million, accounting for 23.1% of the value of its portfolio. The Summit Subang USJ enjoys 74.3% and 64.4% in occupancy rate for its retail podium and office tower respectively. In 2017, this property has made RM 19.1 million and RM 7.3 million in gross revenue and net property income respectively.
- Menara Ambank
Menara Ambank is a 46-storey office building located at Jalan Yap Kwan Seng, Kuala Lumpur. In 2017, it is valued at RM 320.2 million, accounting for 19.3% of the value of its portfolio. The property enjoys a 90.5% in occupancy rate with Ambank Group as its anchor tenant. In 2017, Menara Ambank has contributed RM 24.8 million and RM 15.8 million in gross revenue and net property income respectively.
- Mydin Hypermall
Mydin Hypermall is a 3-storey hypermall building located in Bukit Mertajam, Penang. Amfirst REIT has acquired this property on 29 January 2016 for RM 254.1 million. In 2017, it is valued at RM 275.0 million, accounting for 16.5% of the value of its portfolio. Presently, this building is leased to Mydin Mohamed Holdings Bhd. In 2017, it has contributed RM 16.3 million and RM 16.1 million in gross revenue and net property income respectively.
- Bangunan Ambank Group
Bangunan Ambank Group is a 26-storey office building located at Jalan Raja Chulan, Kuala Lumpur. In 2017, it is valued at RM 259.0 million, accounting for 15.6% of the value of its portfolio. Presently, the building enjoys a 99.6% occupancy rate with Ambank Group as its anchor tenant. In 2017, Bangunan Ambank Group has brought in RM 24.0 million and RM 17.4 million in gross revenue and net property income respectively.
- Wisma Amfirst
Wisma Amfirst is a 16-storey office building located in Kelana Jaya, Selangor. In 2017, it is valued at RM 114.0 million, accounting for 6.9% of the value of its portfolio. It enjoys a 78.6% occupancy rate with a pool of 26 tenants. In 2017, Wisma Amfirst has contributed RM 9.2 million and RM 5.2 million in gross revenue and net property income respectively.
In total, the 5 main properties have contributed RM 93.4 million in revenue, accounting for 83.8% of total revenue of Amfirst REIT in 2017.
#3: The Financials
Amfirst has recorded decline in realized income, down from RM 50.3 million in 2014 to RM 27.9 million in 2017. This is due to lower profits achieved from the Summit Subang USJ, Prima 10, and Menara Ambank and absence of rent from Prima 9 as the property was totally vacant since 2016. Distributions per unit (DPU) has dropped from 7.35 sen in 2014 to 4.06 sen in 2017.
Source: Annual Reports of Amfirst REIT
Source: Annual Reports of Amfirst REIT
#4: Major Acquisition
There is no major acquisition or disposal announced or proposed by Amfirst REIT.
#5: Lease Profile
As at 31 March 2017, 40.8% of Amfirst REIT’s leases would expire in the financial year 2020 and 2021.
As at 30 September 2017, Amfirst REIT’s overall portfolio occupancy rate is 81.5%. With the full tenancy of Prima 9 commencing 1 October 2017 and the higher committed occupancy achieved in The Summit Retail and Office, the overall committed occupancy of the Trust’s portfolio is expected to improve to 87.3%.
Source: Annual Report 2017 of Amfirst REIT
As I write, Amfirst REIT is trading at RM 0.675 a unit.
As at 30 September 2017, Amfirst REIT has reported having RM 1.24 in net asset value a unit. Thus, its current P/NAV works out to be 0.54.
Amfirst REIT adopts a distribution policy to declare and pays out at least 90% of its distributable income on a half-yearly basis. For the 1st half of 2017, Amfirst REIT has paid out 2.12 sen in DPU.
If Amfirst REIT is able to maintain its DPU at 2.12 sen for the next 2 half yearly distributions, it would pay out 4.24 sen in DPU. As such, its gross dividend yield is expected to be 6.28%. For individual investors, it is prudent to deduct 10% withholding tax from 4.24 sen when calculating your net dividend yield, as such, I would expect net dividend yield to be 5.65%.
#7: Debt Profile
As at 30 September 2017, Amfirst REIT has recorded RM 776.7 million in total borrowings. Its debt works out to be 46.2% of Amfirst REIT’s total asset value of RM 1.68 billion, thus, is in line with its policy to maintain below 50% in debt-to-total assets.
#8: Investor Relations
For further enquiries or to request for additional investment information on Amfirst REIT’s Investors Relation matters, you may contact:
Mr. Wong Khim Chon
Chief Executive Officer
Direct Line: 03 7955 8122
En. Zuhairy bin Md Isa
Deputy Chief Executive Officer
Direct Line: 03 7955 8026
En. Abdul Rahman bin Mohd Joned
Vice President, Finance
Direct Line: 03 7955 8120
#9: Major Shareholders
As at 30 September 2017, the substantial shareholders of Amfirst REIT are:
– Ambank (M) Bhd: 26.73%
– Yayasan Azman Hashim: 6.09%
– Jadeline Capital Sdn Bhd: 5.27%
– Valuecap Sdn Bhd: 3.18%
– Yayasan Hasanah: 2.95%