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MANAGER’S REPORT a well-diversified customer base and a large number of properties across six sub-sectors. By diversifying A-REIT’s portfolio, it has also reduced its reliance on any one property such that no single property accounts for more than 4.5% of gross revenue. A-REIT’s risk and exposure to any particular tenant’s country of origin or industrial sector is also reduced due to the diversified nature of the portfolio. With 93 properties and about 930 tenants, A-REIT’s tenants ranges from multi-national companies, small medium enterprises, and listed companies in various trades such as telecommunications, life sciences, food, fragrances and flavours, research & development, light manufacturing, information technology, engineering, electronics, manufacturing services, back-room office support as well as storage and warehousing. Top 10 tenants by monthly gross rental income (% of Gross revenue) 7.0% 5.9% 6.0% 5.0% 4.4% 4.0% 3.0% 2.0% 1.0% 0 SingTel C&P Holdings Creative 3.5% DBS Tenants’ country of origin (by monthly gross rental income) Siemens Singapore 60.2% USA 16.6% Europe 9.5% Japan 3.2% UK 2.2% Bermuda 2.1% Hong Kong 1.5% Switzerland 1.2% Australia 0.9% Others* 2.6% Note: Others include India, Taiwan, Malaysia, South Korea, Canada, China, New Zealand. 2.5% 2.0% 2.0% 1.9% 1.6% 1.5% 1.5% Cold Storage SenKee Logistics Hewlett Packard Toll Asia Courts Tenant base by industry (by monthly gross rental income) 3rd Party Logistics, Freight Forwarding 16.6% Electronics 13.7% M&E and Machinery & Equipment 10.3% Telecommunications & Datacentre 9.3% Information Technology 8.7% Distributors, Trading Company 5.4% Financial 4.9% Life Science 3.1% Food Product & Beverages 2.4% Textiles & Wearing Apparels 2.3% Rubber and Plastic Products 1.8% Healthcare Products 1.4% Chemical 1.1% Printing & Reproduction of Recorded 1.1% Media Hotel and Restaurants 1.0% Repair and Servicing of Vehicles 1.0% Construction 1.0% Fabricated Metal Products 1.0% Medical, Precision & Optical 0.7% Instruments, Clocks Others 13.2% 24 Ascendas real estate investment trust
S$’000 FY09/10 FY08/09 FY07/08 FY06/07 FY05/06 FY04/05 FY03/04 FY02/03 Provision for doubtful debt - 102 324 58 60 121 124 - Doubtful debt provided/bad (72) (222) 266 21 45 37 133 351 debt write-off/(write back) Trade receivables 3,066 2,137 1,977 1,589 2,134 4,033 1,123 627 Total annual gross revenue 413,678 396,534 322,270 283,007 227,153 128,987 65,914 22,836 Doubtful debt provision/bad debts write-off/(write back) as % of gross revenue (0.02)% (0.06)% 0.08% 0.01% 0.02% 0.03% 0.20% 1.54% Bad debt provisions and Write Offs Rigorous management of account receivables has resulted in low doubtful debt provisions as a percentage of total gross revenue. Despite the challenging business environment, A-REIT did not experience a significant increase in past due account receivables as the Manager has a well established internal credit control process in place. About 87% of rental receipts are deducted through Interbank GIRO services. In addition, specific operational actions, such as increased tenant visits and increased vigilance on tenant’s activities, stricter issuance of letter of demand are primed for early signs of trouble. As at 31 March 2010, outstanding accounts receivables that are more than two months past due amounted to about S$1.3m or about 0.3% of gross revenue. These are adequately secured by way of bankers’ guarantee or cash security deposit held by A-REIT. Security Deposit for Sale-and- Leaseback Properties The standard industry practice is to hold one month rent as security deposit for each year’s lease. However, for sale-and-leaseback transactions, depending on the credit-standing of the counterparty and commercial negotiation, a larger sum of security deposits may be held so as to balance between long term lease and the credit risk of such tenants. Security deposits for A-REIT’s sale & leaseback properties range from 7 to 14 months rental income equivalent. The average security deposit for the portfolio is approximately 7 months of rental income equivalent. In addition, the Manager has withheld some part of the purchase considerations on four properties which will be paid out in accordance with a pre-agreed schedule. The total amount withheld was S$14.5m which is about 0.3% of Total Assets as at 31 March 2010. This amount has to be included in the computation of aggregated leverage of A-REIT under the prevailing REIT guidelines. No. of Single Tenanted Properties Weighted Average No. of Months Rent as Security Deposit* Business 4 14 & Science Parks Hi-Tech 7 7 Industrial Light 26 11 Industrial Logistics & 13 8 Distribution Centres Warehouse 2 11 Retail Facilities Total 52 9 Note: * Excluding cases where rental is paid upfront 8th Annual Report FY09/10 25
Page 1 and 2: 8th Annual Report FY09/10 C H A N G
Page 3 and 4: Changing Times... The implosion of
Page 5 and 6: About A-REIT Ascendas Real Estate I
Page 7 and 8: A-REIT’s Competitive Edge Operati
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Page 13 and 14: A-REIT Unit Price Performance FY09/
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Page 17 and 18: capital structure. A-REIT issued a
Page 19 and 20: 董事会主席献辞变迁
Page 21 and 22: 在这个举步维艰的时
Page 23 and 24: Portfolio organic growth of 2.9% wa
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Page 41 and 42: 13 Kathryn Chew 14 Chan Lai Kuan 15
Page 43 and 44: UNITHOLDERS ASCENDAS FUNDS MANAGEME
Page 45 and 46: formulate and implement effective m
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seen since 2003 1 , significantly h
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user high-specs industrial market i
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to S$1.87 per sq ft, while rents fo
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manufacturers anticipates a more fa
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8th Annual Report FY09/10 83
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the chance to take part in intercom
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A-REIT was voted Singapore’s 8 th
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8th Annual Report FY09/10 89
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A-REIT is externally managed by the
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Executive Committee The Executive C
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Trading Of A-REIT’s Units In gene
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Dealing With INTERESTED Party Trans
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FINANCIAL CONTENTS 100 Report of th
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Statement by the Manager In the opi
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Opinion In our opinion, the financi
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Statement of Total Return Year ende
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Statement of Movements in Unitholde
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Investment Properties Portfolio Sta
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Cash Flow Statement Year ended 31 M
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STATISTICS OF UNITHOLDINGS Issued a
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HOW TO CONTACT US To find out more
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Ascendas Real Estate Investment Tru
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