Hektar – declining dividends per unit for the long-term investor

Hektar is a Bursa shopping centre REIT with currently 5 properties with about 2 million sq ft of lettable area.

A long-term unit holder would have suffered during the past 15 years with declining Dividends per unit

While Revenue and FFO in 2022 were higher than those in 2007, PAT was lower. We can trace the financial performance to the declining tenancy performance.

The number of units in Hektar increased from 320 million units in 2007 to 469 million units in 2022 while the financial performance deteriorated. This meant that on a per unit basis, unitholders were worse off in 2022 compared to 2007. Earnings per unit and FFO per unit declined. This then led to a declining Dividend per unit.

Refer to this infographic: https://i.postimg.cc/bYBGQT8x/Hektar.png

When hunting for REIT, don’t look at current dividend yield. Look at its history of how it grew. Growth may not benefit you.

For more insights of Bursa companies, refer to “Are these outstanding stocks - what to consider? (Bursa Malaysia)” https://www.i4value.asia/2020/07/how-to-cut-down-your-investing-time.html#more