CDL Hospitality Trusts (CDLHT) posted results that were within expectation. 1Q17 revenue increased 3.9% YoY to S$46.4m, or 26.2% of our full-year forecast. 1Q17 NPI increased 6.4% to S$35.9m or 25.7% of our full-year forecast, contributed by strong NPI growth from the New Zealand Hotel.

This NPI growth was partially offset by lower contributions from the Japan Hotels and the Maldives Resorts in addition to a decline in variable rent from the Australian Hotels.

While the United Kingdom Hotel clocked a 17.9% YoY increase in RevPAR in GBP terms, its contribution in SGD recorded a marginal decline due to negative currency translation. DPU after retention increased 9.0% YoY to 2.42 S cents, or 24.8% of our full-year forecast.

We note that CDLHT's Singapore Hotels posted a fairly resilient performance with a 0.8% YoY drop in RevPAR on the back of a 4.5ppt increase in average occupancy rates. We keep our HOLD rating but place our fair value of S$1.46 under review.

Source: OCBC Research - 26 Apr 2017