CapitaLand China Trust

This is CLCT's 3Q Updates Briefing. I'm Siyu Yi, IR for CLCT. And with me today, we have our CEO, Jerry, CFO, Joanne, CFO Designate, Lin Tong, Head of IPM, You Hong, and Nicole from the IR team. For this briefing, we will start with a brief presentation, followed by a Q&A session. If you have a question, please use the raise hand feature and I'll direct the time to you. Is that Jerry? Please go ahead.

Hi, good morning. Welcome everybody to Capital Rands China's Trust Business Update for 3Q2025. I'm quite sure everyone has been watching this US-China President Trump and Chairman Xi coming together in South Korea. So that's actually a good way to get us started on this business update for CLCT. First, let me go to a snapshot of where we stand today in terms of our asset allocation. By percentage of GRI, our retail allocation is now at 69.9%, about 70%. That dropped from first half where it was 70.8%, about 1% drop, was because we divested this Kettlemore-Yuwa team through the CREIT securitization exercise. And as a result, of course, the other components that we ran up, 26.5% of GRIs in business parks, 3.6% in logistics parks. In terms of our distribution view, it's now 6.2%. Stock price came up a bit. That caused a compression in views. That is also reflecting some of the overall S3 view compression across the board. In terms of 3Q key highlights, I'm very happy to again share that CLCT together with our sponsor, we have listed the CLCR on Shanghai Stock Exchange on 29th September 2025. That is China's first international sponsored retail CWIC. It opened well. It opened trading at 19.6% above its IPO price of $5.718 per unit, that is CLCR. For CLCT, of course, we seeded this CREIT with our capital more imparting, and we also became a strategic investor through our 5% holding of units in CLCR. Overall, I would say that, I think I mentioned before, the demand for CREIT has been, I would say, very, very encouraging. The IPO oversubscription is 254 times for institutional, retail 535 times. We can see that allocation-wise, we have 20% with the originating or the strategic sponsor group, of which CLCT is one of them. We hold 5%. In terms of the current, at IPO, the DPU yield for CLCR is 4.4%. Currently, it's already traded. Currently, the trading yield for CLCR is between 3.8% to 3.9%. During third Q, we also refinanced and issued 150 million of perpetuals. That was also very well subscribed, 3.4 times subscription coverage. And interestingly, we also have quite a big portfolio fund manager and insurance companies allocation, about more than half of it was to institutional investors. So we successfully completed our perpetuals refinancing through this exercise. In third quarter, we also attain and maintain our five-star rating for Grasty. This is the third year where we have obtained our five-star rating. So very well done to our sustainability team there. In terms of results, for 3Q, you can see in terms of overall portfolio, our gross revenue came down by 8%, our NPI also came down by 8%. In terms of, if you consider on the same store basis, excluding our divestment or devoting, that number would be basically the gross revenue drop of 3.4%, and MPI, same sort of basis, drop of 4.4%. Now, if you compare that to first half, for our overall revenue, the drop would have, excluding UBATI, the drop would have been minus 4.7% in first half. So we are talking for the, sorry, let me take that back. Let me rephrase that. For our retail revenue, for our retail revenue, it dropped for this third quarter minus 1.8% without equating for retail revenue. If you compare the first half, on the same basis, it will drop 4.7% without equating. So you can see that actually our retail revenue, the drop has narrowed. For business parks, the revenue this quarter dropped by 9.1%. Again, due to Singapore Hangzhou Phase 2. If you compare the first half, the drop was about minus 10%. Again, a slight narrowing of drop. In terms of logistics revenue, this quarter we went up by 13%. compared to the first half, where it was increased by 2%. That was mainly due to the improved occupancy at Shanghai Fengxian. Let me add more colour in terms of, just now I talked about the retail revenue, in terms of overall revenue drop from BPA as well. If you look at our overall revenue this quarter, it dropped by about 36 million RMB, of which 21 million came from the lost revenue from the divested reporting. So that's about 58%. About 10 million was from business stocks due to the conditions that I have mentioned. So that's about 28% of that drop. And the rest, came from what we have put here in terms of lower rents and occupancy at the Mall Sinan and mid-anchor tenant repositioning at Rock Square. For the Rock Square mid-anchor repositioning, right, we have basically have had a tenant open on 1st October. So that would go away in fourth queue. It was that space would start contributing and that tenant is Decathlon at Rock Square and the new tenant, Decathlon, has saw good traffic and started contributing to Rock Square's numbers from October onwards. In terms of MPI, I mentioned minus 8.5% overall year-on-year. Again, very much due to the divested in Huaqing's MPI loss. So on the same store basis, we see minus 4.4%. And of course, there are some other factors due to the overall drop in gross revenue from other asset class, other assets like the business stocks and some of the assets like capital more. On the other hand, it's partially offset by our cost reduction efforts of about 1.3% year-on-year on same-store basis. The next slide, we take a look at some of the retail metrics. If you look at shopper traffic and tenant sales, third queue compared to first half or nine months, for the year, you would see that 3Q actually both on shopper traffic and tenant sales have done quite well comparatively speaking. 3Q year-on-year increase in shopper traffic is 4.5%, tenant sales 3Q increase is 3.2%. One of the factors is I would say is that some of the Key sectors continue to do well. We also have the effect of better golden week holidays in 2025 than 2024. So for the key trade caps, if you look at F&B, we are plus 5.1% for year-on-year for the nine-month basis. Infotech, plus 12.8%. Toys and Hobbies, again, very strong momentum, plus 56%. and jewelry and watches, 16.6%. So these key factors continue to do well, whereas maybe some of, I mentioned before, some of the weaker ones, weaker categories like fashion and beauty and health continue to have single digits drop in sales year on year. In terms of AEI, we have completed, we have seen the contribution from Capital More Shareful and some contribution from Wang Jing which I'll talk about later. But here in this slide, we just wanted to highlight one of the key growth drivers for 3Q which is Capital More Shareful's AI that added 20.8% to our shareable traffic for that mall and a 24% increase in terms of 10 sales in that quarter. Occupancy costs continue to maintain at about 17.7. That's quite stable below pre-COVID levels. In terms of China's Golden Week, we saw, as I mentioned earlier, a better Golden Week than last year. So we had 4.6% year-on-year increase in traffic, about 4% increase in total sales versus the last comparative period for Golden Week last year. If you look at retail occupancy, we have a slight bump in this quarter. Some of our show malls called Xizhimen, Rock Square, Xuefu, Snowmolar are basically fully leased and that has helped to bring up the retail portfolio occupancy. There is continual repositioning for capital mall C9, which you can see the occupancy drops slightly. We are trying to work hard to pivot that mall to a new concept where we focus more on the IP and the anime and the young, to cater to the younger generation. So what we call And we are seeing some progress there, but in the interim, there will be some bumps in occupancy. In terms of retail reversions, we see that we now have a retail regression for nine months of about minus 1.5%. And these have narrowed from first half where we reported about minus 3%. And some of the reversions, stronger reversions in C, are from again, the strong categories that I spoke about, F&B, IT, toys and gifts. Again, the weaker versions are from fashion and beauty and health. So that's basically for retail. For business parks, our overall occupancy dropped by 86.9% to 85.2%. I'll explain shortly why that's happened. The Sing Su portfolio and our, our Sing Su portfolio has been relatively stable. There was a small drop due to one of the, one tenant, you know, basically giving up the space, but we are looking to fill them. The AIT asset in Xi'an, that asset has started to basically fill the Ping An's, filled the space that was located by one of our big tenants that left one year ago. And currently now we have brought it from 74.6% to 75.4%. We are making quite good progress. And by the end of December, we are looking for the occupancy of mid-80s. So we have some tenants already lined up So they were coming progressively and we hope that by end of December we will be able to push it up to the mid 80s. AIH continue to be at the mid 80s levels. 80s levels, there was some drop but we will try to fill in those tenants as well. For Hangzhou, Phase 1 had a small increase and Phase 2 where we had previously shared that we have basically taken over some service office tenant space. That was at about 25,000 square meters. In third quarter, we had another service office space, which when we review our tenant portfolio for phase two, we found that we wanted to proactively take over that service office tenant to basically start to convert them into spaces that we can control directly. There was, of course, learning from the earlier exercise where we took over the space on the service office operator. We thought that it may be better that we take it over earlier. so that the transition, if the service office operator dropped off, would be easier. So that was what we did in 3Q. You could see that that caused a temporal reduction in occupancy from 79.7% to 70.7%, because the service office was about 39,000 square meters, and when we take it Back, you know, we directly signed leases with the sub-tenants of which about 64% of that space was leased. So that cost basically had changed from a master lease of 100% to about 60% of the space being in our books being leased. We are working hard on this and we hope to repeat the success that we have with the other service office operator that we took in. In all, we took back, from the last round we took, plus this round, we took back about, I would say, about more than 50,000 square meters of space. We have now already listed out about 67% of that space, right? So in the fourth year, I think we should be able to push that phase two occupancy closer to what we saw in June 2025 of the high 70s market. For the business card reversion, for first half it was minus 8%, so for nine months, Including the third tier is minus 8.9%. So for business fund, we continue to deploy rental incentive as a key tactic to maintain our occupancy as well as preserve asset value in quite a challenging market in some of the business fund assets. Overall, you can see that our business parts continue to, in terms of occupancy, continue to outperform the sub-market. Sin Su in Suzhou, of course, outperformed quite significantly, about 30% For the Siam portfolio, AIT and AIH, currently it's slightly below sub-market, but with the committed Committed Finance, they have signed on in October. Our AIT-AIH as a cluster would have 83.9% occupancy that would have outperformed the sub-market. As I was mentioning before, we should see even more and that should push up the whole CN cluster above 83.9% in terms of occupancy. Hangzhou at 73%, it's also outperforming the Hangzhou sub-market. And we should, as I mentioned, involve key contingency improvements in our Hangzhou overall business park occupancy. In terms of logistics, we're quite stable. Same occupancy as June 25, 96.6%. The leprosy revisions that you see there basically is due to one of our review of our strategic anchor tenant at Wuhan, which was already previously reported. I will let Joanne take the capital management part before I close off.

Okay. On our financial position for this quarter, as you can see, the total debt has actually reduced from $1.8 billion to $1.6 billion. This is also actually because of the temporal use of the proceeds from the perpetual that we showed in September. That also actually brings down our gearing to 38.8%, as you can see. But we have actually redeemed the perpetual up there, I think two days ago. If we actually include that additional perks that we have used our loans to redeem, that gearing would have been 41.3%. On the average cost of debt in this quarter, it has actually improved from 3.42% to 3.36%. I think this is actually the fruits, the label of the fruits that we have actually earlier on issued CNH bonds and also all the initiatives that we have actually rolled out that at that point in time, CNH interest was actually lower and we actually benefited and that can be seen from the cost of debt in this quarter. Our ICR is at 2.9 times. and average step to maturity is 3.4 years. In terms of the ICR sensitivity, as you can see on the right table, on a 100 basis coin interest rates movement, our ICR is still at 2.3 level, which is a healthy level. Same goes for the sensitivity on the EBITDA. A 10% decrease on the EBITDA, my ICR is still at 2.6 times. That is way above the requirement by MAS of the 1.8 times where we need to actually explain and put out some explanation to that. We also have a sensitivity in terms of the gearing. On a 1% movement of $10 to the new fee, our gearing will move about 0.27%. I think this is something that we actually put out on a pet maturity profile. As you can see, for 2025, we're actually pretty done. There's nothing that is due for refinancing for 2025. In fact, I think the team has actually proactively looked out to actually extend our loans. And then we actually worked on the 2026 Tower. $120 million, which was actually a $10 debt, has actually been refined, will be refined to a learning fee debt. I think we are working towards what we have actually communicated to the investors that by end of this year, we are actually targeting our learning fee debt as a total percentage of our total debt to be at least 50%. As of 30th September, we are actually reporting a 45%. I think By end of the year, we will definitely be more than 50% as what we have actually wanted to achieve. As a percentage of total fixed food floating, we're at 80% fixed this quarter. This level is at this level because, again, for the temporal perpetuation that we used to proceed, we actually had our floating debt. And in this percentage, you will see that this fixed percentage will come up a little bit. to actually benefit from the lower SORA that we're seeing right now in the current industry environment. And I think in terms of the debt funding mix, we're pretty well mixed. We've introduced remunerated bond. We also have done actually debt bond and also increased our onshore remunerated loans percentage. I think that's a little bit color of the debt maturity profile and capital management. I'll hand back to Jerry to actually... Okay, so thanks, Joyce.