Far East Hospitality Trust (FEHT) reported its 4Q15 results this morning which met our expectations. Operational performance remained muted, as gross revenue fell 4.7% YoY to S$28.9m, while DPU slumped 8.6% to 1.17 S cents. This was underpinned by a 4.4% YoY dip for its Hotels portfolio RevPAR to S$146 and a 13.5% decline in RevPAU for its Serviced Residences portfolio to S$180.

For FY15, FEHT’s gross revenue decreased by 5.8% to S$114.6m, and formed 96.7% of our full-year projection. DPU of 4.60 S cents represented a fall of 10.5%, but was just 1% lower than our forecast. We will provide more details after the analyst briefing. For now, we have a HOLD rating and S$0.67 fair value estimate on the stock.

Source: OCBC Research - 24 Feb 2016