CDL Hospitality Trusts (CDLHT) posted a weak set of results as expected. Revenue dropped 10.6% to S$46.3m while NPI declined 10.7% to S$33.8m. DPU dropped 3.7% to 2.09 S cents or 22.4% of our full-year forecast.

We consider this within expectations – as a reference, 1Q18 DPU contributed 23.4% to FY18 DPU. Singapore RevPAR dropped 2.7% YoY.

As mentioned in our last company report and sector report, we expected CDLHT to suffer from 1) a decline in contributions from Orchard Hotel and Dhevanafushi Maldives Luxury Resort due to asset enhancement initiatives at both assets, as well as 2) soft RevPARs locally in 1Q19.

We maintain HOLD but place our fair value of S$1.56 under review pending further details.

Source: OCBC Research - 30 Apr 2019