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2019 Third Quarter Financial Results

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Condensed Consolidated Statement Of Comprehensive Income

Condensed Consolidated Statement Of Financial Position

Review of Performance

Quarter Results (1Q 2019 vs 1Q 2018)

The Group recorded gross revenue of RM87.9 million in 1Q 2019, a decrease of RM1.8 million or 2.0% against 1Q 2018. The decrease is mainly due to lower occupancy at Sungei Wang (SW), The Mines (TM) and 3 Damansara (3D), lower rental rates and downtime from asset enhancement works at SW and TM as well as the absence of a one-off forfeiture of deposit and compensation of premature termination of a mini anchor tenant at SW. The decrease was mitigated by better performance from Gurney Plaza (GP) and East Coast Mall (ECM) on the back of higher rental rates and full occupancy at Tropicana City Office Tower.

Property operating expenses for 1Q 2019 were RM35.2 million, an increase of 7.5% against 1Q 2018. This is mainly due to the absence of a one-off service charge rebate at SW, higher utilities consumption and reimbursable staff cost. The increase was, however, offset by a one-off prior year property assessment fees at GP.

The net property income for 1Q 2019 of RM52.8 million was 7.5% lower than 1Q 2018.

CMMT registered a net fair value gain of RM2.3 million on investment properties in 4Q 2018.

Finance costs for 1Q 2019 of RM15.2 million were 1.5% higher than 1Q 2018. The increase was mainly due to additional revolving credit facilities drawn down for capital expenditure works and higher average cost of debt for 1Q 2019 at 4.47% p.a. (1Q 2018: 4.44% p.a.).

CMMT has incurred RM14.4 million of capital expenditure during the quarter. This is mainly attributed to Jumpa retail layout design and reconfiguration works at SW, enhancement works of the food and beverage area on Level 2 at TM and tenancy works at ECM.

Overall, distributable income to unitholders for 1Q 2019 was RM35.0 million, a decrease of RM6.3 million or 15.2% against 1Q 2018.

Financial Year-to-date Results (FY 2019 vs FY 2018)

Review of financial year-to-date results is the same as above

Commentary on Prospects

Malaysia's economy expanded at a moderate pace of 4.7% in 2018, anchored by growth in domestic demand and supported by private investment. Despite challenging global headwinds, the economy is expected to sustain its growth momentum and expand between 4.3% to 4.8% in 2019 (source: Bank Negara Malaysia Annual Report 2018).

Against a backdrop of uncertainties in the global and domestic economies, we foresee business and consumer sentiments in Malaysia to remain challenging in 2019, owing to persistent concerns about rising costs of living. The coming on stream of new retail mall supply is expected to intensify competition among shopping malls, particularly those in the Klang Valley area.

Comprising a quality mix of neighbourhood malls located in key urban centres across Malaysia, CMMT's portfolio is largely focused on day-to-day necessity shopping, a market segment that has proven resilient through different economic cycles and is expected to continue being so. To enhance the appeal of CMMT's malls, the Manager continually refreshes its assets through enhancement initiatives, improvement of trade mix and marketing initiatives. The Manager remains committed to ensure that CMMT is well positioned to sustain its performance and deliver sustainable income distributions to unitholders in the long term.