Far East Hospitality Trust (FEHT) reported its 4Q14 results this morning which met our expectations. Gross revenue and DPU dipped 9.8% and 9.9% to S$30.3m and 1.28 S cents, respectively. Topline was impacted by headwinds facing the hospitality sector, which resulted in a 3.6 ppt decline in average occupancy to 82.4% and a 4.0% drop in its average daily rate to S$186. Hence RevPAR was down 8.0% YoY to S$153.

For FY14, gross revenue slipped 0.6% to S$121.7m and formed 98.1% of our full-year forecast. DPU of 5.14 S cents represented a decline of 8.9%, but was in-line with our projection of 5.2 S cents. We will provide more details after the analyst briefing. We maintain our HOLD rating but will review our S$0.80 fair value estimate.

Source: OCBC Research - 11 Feb 2015