Mapletree Industrial Trust (ME8U) Q2 25/26 earnings summary

Executive summary

• Net property income for 2QFY25/26 fell 7.8% year-over-year to S$124.0 million, mainly due to divestments in Singapore, lower North American contributions, and FX headwinds, partially offset by new contributions from Tokyo and Osaka data centres.

• Distribution per unit (DPU) for 2QFY25/26 was 3.18 cents, down 5.6% year-over-year; excluding divestment gain, DPU declined 2.2%.

• Portfolio rejuvenation included the divestment of three Singapore properties and a data centre in Georgia, unlocking value above market and original costs and increasing debt headroom.

• Portfolio occupancy remained stable at 91.3%-91.4%, with Singapore occupancy flat and North America slightly down due to lease expiries.

• Management is focused on improving occupancy, executing forward renewals, and pursuing further divestments and acquisitions, especially in Europe and Asia.

Financial highlights

• 2QFY25/26 gross revenue: S$170.2 million (down 6.2% y-o-y); net property income: S$124.0 million (down 7.8% y-o-y).

• 1HFY25/26 gross revenue: S$346.1 million (down 3.0% y-o-y); net property income: S$257.7 million (down 3.5% y-o-y).

• Distribution to unitholders for 2QFY25/26: S$90.7 million (down 5.3% y-o-y); for 1HFY25/26: S$184.0 million (down 4.7% y-o-y).

• Borrowing costs for 1HFY25/26 decreased 13.3% to S$46.2 million due to loan repayments from divestment proceeds and lower interest on floating rate loans.

• Net asset value per unit as at 30 Sep 2025: S$1.69.

Outlook and guidance

• Operating environment remains challenging amid global uncertainties, inflation, and rising borrowing costs as interest rate swaps reprice.

• Management expects further divestments of S$500-600 million over the next 1-2 years, with S$100-200 million targeted for this financial year.

• Focus remains on improving occupancy, active lease management, and prudent capital management, with expansion into data centre markets in Europe and Asia Pacific.

• Singapore's GDP growth forecast for 2025 upgraded to 1.5%-2.5% following better-than-expected 1H2025 performance.

• North American and Japanese data centre markets see strong demand but face power and land constraints.