KUALA LUMPUR: Sunway Real Estate Investment Trust (SunREIT) recorded strong retail sales in the first quarter of the year, which approached 100% normalcy as compared to the same pre-pandemic period in 2019.
"We believe that the worst is over and we are optimistic that the positive trend will continue to sustain as the economy transitions to the endemic phase of the COVID-19," said CEO of the Manager Datuk Jeffrey Ng in a statement.
For the first quarter ended March 31, 2022, SunREIT said net property income rose 77.4% year-on-year (y-o-y) to RM118.92mil.
It registered a net profit of RM106.32mil, which was nearly three times the net profit of RM36.82mil in the previous corresponding quarter.
Revenue came to RM153.97mil in the quarter under review, a 47.67% increase over RM104.27mil in 1Q21.
By segment, SunREIT said the retail segment's revenue surged 83.5% y-o-y to RM98.4mil due to an improved performance across all retail properties.
The biggest improvement was recorded by Sunway Pyramid Mall, which doubled its revenue to RM77.6mil in 1Q22.
"The improved performance of the retail properties was supported by the higher retail footfall and encouraging tenant sales in 1Q2022 in conjunction with the strong pent-up demand, festive spending and relaxation of Covid-19 safety measures.
"Hence, marginal rental support was granted as compared to 1Q2021," said the REIT in a filing with Bursa Malaysia.
SunREIT said the hotels segment saw revenue increase 28.6% y-o-y to RM18.5mil, underpinned by an overall improved occupancy with the increase in domestic leisure, business travel and gradual increase in meetings, incentives, conventions and exhibitions (MICE) activities.
Meanwhile, the office segment recorded a marginal 0.7% y-o-y increase in revenue to RM19.5mil, while the services segment's contribution was 3.2% higher y-o-y at RM15.8mil.
On prospects, Ng said given the anticipation of stronger retail sales, the Manager expects marginal rental support provision in FY2022, which in turn, contributes positively to the earnings of Sunway REIT.
He added that the REIT is cautiously optimistic on the prosects of the hotel segment following the gradual recovery of the tourism industry and resumption of income distribution from the flagship Sunway Resort Hotel.
"The Manager expects the financial performance of Sunway REIT to improve significantly in FY2022, supported by reopened international borders, stronger domestic economic growth, improved consumer sentiment on the back of stable employment prospects as well as the progressive re-opening of Sunway Resort Hotel and completion of Sunway Carnival Shopping Mall’s (new wing) expansion," said Ng.