CDL Hospitality Trusts (CDLHT) reported its 4Q14 results which was in-line with the street’s expectations. Gross revenue and DPU rose 14.4% and 7.2% YoY to S$45.1m and 3.13 S cents, respectively, underpinned by the recognition of a full quarter's hotel revenue from Jumeirah Dhevanafushi amounting to S$5.4m. FY14 gross revenue came in at S$166.8m (+12.1%) , while DPU was flat at 10.98 S cents (+0.1%). This formed 103.1% and 99.8% of Bloomberg consensus’ projections, respectively.

Looking ahead, CDLHT will continue to focus on finding suitable acquisition opportunities in the hospitality sector. Its healthy gearing ratio of 31.7% provides it with sufficient debt headroom to finance prospective acquisitions. We will provide more updates after speaking with management.

Our HOLD rating and S$1.80 fair value estimate is under review.

Source: OCBC Research - 28 Jan 2015