ec wORLD rEIT

Result is out, Net profit is up !
EC WORLD REIT Delivers Net Property Income Growth of 17.4% year-on-year for 4QFY19.

DPU of 1.51 cents is down 3.8% versus last year 1.57 cents.

Gross revenue and net property income in RMB terms for 4QFY19 (after straight-line, security deposit accretion and other relevant distribution adjustments3) recorded doubledigit year-on-year growth of 17.4% and 19.5% to RMB134.5 million and RMB129.5 million respectively, attributed to the embedded rental escalations and income contribution from Fuzhou E-Commerce which was acquired in August 2019. As at 31 December 2019, ECW REIT portfolio comprises eight assets, of which seven are in Hangzhou and one in Wuhan (Wuhan Meiluote). Four out of the seven assets in Hangzhou are under master lease arrangements which provide for fixed rental with built-in escalation. There is no variable rental component under the master lease arrangements. Portfolio valuation grew 20.6% to RMB8,118 million largely due to Fuzhou E-Commerce which was acquired in August 2019. Excluding Fuzhou E-Commerce, portfolio valuation, on a like-for-like basis, would have increased 1.5% year-on-year.


After an extended Spring Festival break, ECW REIT’s assets, with the exception of Wuhan Meiluote, have received the necessary permits to restart operations.

The Manager has received notification from a tenant for the non-renewal of 24,929 sqm of space at Wuhan Meiluote in 2QFY20. Due to the COVID-19, Manager expects demand for space in Wuhan

to be muted. Wuhan Meiluote accounts for 1.6% of the REIT’s portfolio net property income in FY19. The Manager understands that several landlords in China have committed to certain rental rebates4,5 , and thus anticipates similar requests as its tenants switch its operations into full gear (albeit over a period of time). It will evaluate the request on a case-by-case basis and will keep the investing community duly informed of any material development.


While long-term fundamentals for the logistics sector in China remain attractive, short term volatility and disruption can be expected given the severity of control measures implemented in China. The Manager remains highly vigilant to any changes in situation and stands ready to respond promptly. - E