9 Things You Must Know About CapitaLand Malaysia Mall Trust

CapitaLand Malaysia Mall Trust (CMMT) is a REIT that invests in shopping mall properties in Malaysia. On 16 July 2010, it was listed on Bursa Malaysia with an initial portfolio of 3 properties valued at RM 2.13 billion. Since then, it has acquired two additional properties, thus, enlarging its portfolio to 5 properties valued at RM 3.94 billion as at 30 September 2017.

In this article, I’ll share 9 quick facts that you need to know about CMMT before you invest.

#1: Stock Symbol

Ticker Symbol: KLSE: CMMT / KLSE: 5180
Market Capitalization: RM 2.89 Billion (9 December 2017)

Share Price: RM 1.42 (9 December 2017)

Industry: Reit

Syariah Compliant: No

#2: The Business

CMMT derives income from 5 properties. They are:

1. Gurney Plaza
   It is a 9-storey shopping mall located along the infamous Gurney Drive promenade in Penang. As I write, it is one of the major retail and lifestyle destination in Penang. As at 30 September 2017, it is valued at RM 1.55 billion, 58.9% of CMMT’s net asset value. Thus, Gurney Plaza is the trophy asset of CMMT. In 2016, it has enjoyed 99.1% in occupancy rate and has contributed RM 137.7 million and RM 96.9 million in gross revenue and net property income.
   
   
2. The Mines
   It is a 5-storey shopping mall located at Seri Kembangan town centre, Selangor. It is well-known for having an internally built Venetian-like water canal. Presently, The Mines remains a popular suburban retail destination catered to shoppers residing in the Southern Region of Kuala Lumpur and Selangor. As at 30 September 2017, The Mines is valued at RM 724.0 million, 27.5% of CMMT’s net asset value. In 2016, The Mines has reported 98.0% in occupancy rate and has made RM 80.2 million and RM 51.7 million in gross revenue and net property income.
   
   
3. Sungei Wang Plaza
   It is a 11-storey shopping mall located at the ‘Golden Triangle’ of Kuala Lumpur. As at 30 September 2017, Sungei Wang Plaza is valued at RM 583.0 million, 22.1% of CMMT’s net asset value. In 2016, it has enjoyed 91.0% in occupancy rate, a decline from 98.0% reported in 2013. The financials of Sungei Wang Plaza was impacted temporarily by the ongoing MRT works nearby and the closure of adjoining Bukit Bintang Plaza since 2014. In 2016, it has contributed RM 45.3 million and RM 27.3 million in gross revenue and net property income, the lowest over the last 5 years.
   
   
4. East Coast Mall
   It is a 4-storey shopping mall located at the heart of Kuantan City, Pahang. As at 30 September 2017, East Coast Mall is valued at RM 509.0 million. In 2016, it has enjoyed 98.4% in occupancy rate and has contributed RM 57.1 million and RM 36.6 million in gross revenue and net property income.
   
   
5. Tropicana City Mall & Tropicana City Office Tower
   It comprises of a 4-storey shopping mall and a 12-storey tower block which are interconnected via an overhead covered link bridge. They are located strategically at the intersection of two highways, namely the Sprint Highway and Lebuhraya Damansara Puchong (LDP). As at 30 September 2017, Tropicana City Mall and Tropicana City Office Tower have reported 92.5% and 95.2% in occupancy rate respectively. Collectively, they have contributed RM 52.3 million and RM 30.0 million in gross revenue and net property income.

#3: The Financials

CMMT has reported growth in gross revenues, net property income and distributable income over the last 5 years. The growth was attributed mainly from improved financial results of Gurney Plaza, The Mines and East Coast Mall and contributions from Tropicana City Mall & Tropicana City Office Tower. The growth was dampened by lower sales and profits from Sungei Wang Plaza. Overall, CMMT has maintained its distribution per unit (DPU) at 8.0 – 9.0 sen a year.

Source: Annual Reports of CMMT

Source: Annual Report 2016 of CMMT

#4: Major Acquisition

There is no major acquisition or disposal announced or proposed by CMMT.

#5: Lease Profile

As at 30 September 2017, CMMT derives income from a pool of 1,318 tenants. 42.2% and 22.0% of CMMT’s retail and office leases would expire in financial year 2019 and beyond respectively. They are:

Source: Results Presentation Q3 2017 of CMMT

#6: Valuation

As I write, CMMT is trading at RM 1.42 a unit.

As at 30 September 2017, CMMT has reported to have RM 1.27 in net asset value a unit. Thus, its current P/NAV works out to be 1.12.

CMMT adopts a distribution policy to declare and pay out at least 90% of its distributable income on a half-yearly basis. For the 1st half of 2017, CMMT has paid out 4.14 sen in DPU.

If CMMT is able to maintain its DPU at 4.14 sen for the next 2 half yearly distributions, it would pay out 8.28 sen in DPU. As such, its gross dividend yield is expected to be 5.83%. For individual investors, it is prudent to deduct 10% withholding tax from 8.28 sen when calculating your net dividend yield, as such, I would expect net dividend yield to be 5.25%.

#7: Debt Profile

As at 30 September 2017, CMMT has recorded RM 1.33 billion in total borrowings. Its debt works out to be 32.4% of CMMT’s total asset value of RM 4.11 billion, thus, is in line with its policy to maintain below 50% in debt-to-total assets. The average cost of debt is 4.41%.

#8: Investor Relations

For further enquiries or to request for additional investment information on CMMT’s Investors Relation matters, you may contact:

Telephone:

+603 2279 9888

Email:

Ms. Jasmine Loo

jasmine.loo@capitaland.com

 

Website:

http://www.cmmt.com.my/information_request.html

#9: Major Shareholders

As at 31 December 2016, the substantial shareholders of CMMT are:

– CMMT Investment Ltd: 35.00%

– Employee Provident Fund Board: 9.47%

– Amanah Saham Bumiputera: 12.31%

– Kumpulan Wang Persaraan (Diperbadankan): 8.52%

– Amanah Saham Malaysia: 2.77%

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