KLCC (5235SS) - KLCC Property Holdings - Growth from retail
Target RM6.90 (Stock Rating: HOLD)
KLCCP's 4Q14 core net profit of RM205.1m brought its full-year FY14 core net profit to RM711.2m. This is in line with our estimate as it accounted for 102% of our and 98% of consensus full-year forecasts. Core net profit grew by 24.6% yoy. Revenue growth in FY14 was driven by its retail and management services, which grew by 5.4% and 21.2% yoy, respectively. We make no changes to our FY15-16 earnings forecasts, while we introduce our FY17 numbers. While the results were in line, we note that KLCCP's outlook remains dry as there are unlikely to be any acquisitions in the near-term. We maintain our Hold call on the stock. Our DDM-based target price remains unchanged. For exposure to M-REITs, we prefer Axis REIT.
4Q14 DPU of 8.75 sen
KLCCP declared a total of 8.75 sen per share in DPU for 4Q14. This brings its total DPU for FY14 to 33.6 sen. 4Q14 DPU included 3.89 sen from KLCCP's property development side and 4.86 sen from the REIT side. FY14 DPU was below our expectation as it accounted for only 89% of our full-year DPU forecast.
4Q14 earnings review
4Q14 revenue grew by 4.5% yoy, driven by growth in its retail (+3.5% yoy), hotel (+1.2% yoy) and management services (+23.4% yoy), while its office segment remained flat as it is under a long-term triple-net lease agreement. Its retail revenue growth was mainly underpinned by rental reversions during the year, while its hotel operations growth was driven by the hotels' F&B segment, coupled with higher revenues arising from the opening of the ballroom facilities after the completion of renovations. KLCCP's 4Q14 PBT grew by 4.2% yoy, in line with its revenue growth.
No acquisitions to look forward to
Aside from its own developments such as Menara Dayabumi, we believe that it is unlikely that KLCCP will acquire any other assets in the near- to medium-term. We note that funding is not an issue as KLCCP's balance sheet remains healthy, with gross and net gearing standing at 0.17x and 0.1x, respectively. However, the issue with acquisitions is mainly the lack of suitable and available assets of similar standards as those already in its portfolio, e.g. Suria KLCC.
Source: CIMB Daybreak - 27 January 2015
Target RM6.90 (Stock Rating: HOLD)
KLCCP's 4Q14 core net profit of RM205.1m brought its full-year FY14 core net profit to RM711.2m. This is in line with our estimate as it accounted for 102% of our and 98% of consensus full-year forecasts. Core net profit grew by 24.6% yoy. Revenue growth in FY14 was driven by its retail and management services, which grew by 5.4% and 21.2% yoy, respectively. We make no changes to our FY15-16 earnings forecasts, while we introduce our FY17 numbers. While the results were in line, we note that KLCCP's outlook remains dry as there are unlikely to be any acquisitions in the near-term. We maintain our Hold call on the stock. Our DDM-based target price remains unchanged. For exposure to M-REITs, we prefer Axis REIT.
4Q14 DPU of 8.75 sen
KLCCP declared a total of 8.75 sen per share in DPU for 4Q14. This brings its total DPU for FY14 to 33.6 sen. 4Q14 DPU included 3.89 sen from KLCCP's property development side and 4.86 sen from the REIT side. FY14 DPU was below our expectation as it accounted for only 89% of our full-year DPU forecast.
4Q14 earnings review
4Q14 revenue grew by 4.5% yoy, driven by growth in its retail (+3.5% yoy), hotel (+1.2% yoy) and management services (+23.4% yoy), while its office segment remained flat as it is under a long-term triple-net lease agreement. Its retail revenue growth was mainly underpinned by rental reversions during the year, while its hotel operations growth was driven by the hotels' F&B segment, coupled with higher revenues arising from the opening of the ballroom facilities after the completion of renovations. KLCCP's 4Q14 PBT grew by 4.2% yoy, in line with its revenue growth.
No acquisitions to look forward to
Aside from its own developments such as Menara Dayabumi, we believe that it is unlikely that KLCCP will acquire any other assets in the near- to medium-term. We note that funding is not an issue as KLCCP's balance sheet remains healthy, with gross and net gearing standing at 0.17x and 0.1x, respectively. However, the issue with acquisitions is mainly the lack of suitable and available assets of similar standards as those already in its portfolio, e.g. Suria KLCC.
Source: CIMB Daybreak - 27 January 2015
