segments
.
Revenue from our complementary
Facilities Management Business also rose in
tandem with the increase in leasing activity
,
while our Logistics Services Business continued
to gain traction with strong gains in sales
.
We will continue to monitor market
conditions closely so that we can respond
nimbly to changes in the business environment
to achieve higher revenues
.
At the time of IPO
,
we announced our
intention to recommend and distribute dividends
of not less than 20% of our net attributable
profit for the financial years FY2015 and
FY2016
1
,
we are pleased to fulfil this promise
and propose a final one-tier tax-exempt
dividend of 0
.
30 Singapore cents per share for
FY2015 subject to shareholders
’
approval
.
This
represents a dividend payout ratio of 22%
.
PROSPECTS AND FUTURE PLANS
An oversupply of industrial space is widely
anticipated over the next 24 months
2
and this is
expected to bring rental costs down
.
The Group
intends to take advantage of this by selectively
securing long-term master leases of buildings
in strategic locations at competitive rates
.
We
continue to see demand for such spaces from
growth industries including e-commerce
,
technology
,
warehousing and self-storage
services
.
In FY2015
,
the average occupancy rate
of our industrial properties was approximately
93%
.
Meanwhile
,
the slowing economy is also
driving businesses from the prime business
districts to city fringe areas where rental costs
are lower
.
This bodes well for our commercial
properties which are conveniently located
in highly accessible areas
.
In FY2015
,
the
average occupancy rate for this segment was
approximately 96%
.
In view of the aforementioned
,
we have been
hard at work strengthening our pipeline for the
next 12 months
.
We have recently been awarded a master
lease renewal for our property at 27 West Coast
Highway for a tenure of three years
,
which is
renewable for another three plus one years
.
The property will undergo a rejuvenation on
the 1st storey where the commercial units will
be reconfigured to accommodate a new tenant
mix and to meet the current rental market
requirements
.
To tap into the rising demand for work and
self-storage (
“
W+S
”
) concepts targeted at
businesses in e-commerce
,
we have several
projects lined up for this purpose
.
This includes
100 Eunos Avenue 7
,
which we completed the
acquisition in August 2015
.
Using our space
optimisation expertise
,
we intend to increase its
net lettable space by 50% and will house a W+S
facility
.
We have also earmarked spaces in four
other properties of at least 10
,
000 square feet
each to be converted into W+S facilities
.
APPRECIATION
On behalf of the Board of Directors and the
management of the company
,
I would like to
thank our shareholders for investing in us
.
We
are focused on the long term growth of the
company and we are devoted to delivering the
plans that we had committed to at IPO
.
I would also like to thank my fellow directors
for their support
,
the management team and
all the dedicated LHN staff who have worked so
hard to contribute to the vision and goals of the
Group
.
My greatest appreciation also to our
landlords
,
tenants and business partners whose
unwavering support has enabled us to achieve
the success we enjoy today
.
1
.
Investors should note that the statement in relation to the proposed dividends is merely a statement of our present intention and
shall not constitute legally binding obligations
.
The distribution of future dividends may be subject to modifications
,
including the
reduction or non-payment thereof
,
at the sole and absolute discretion of our Directors
.
2
.
Channelnewsasia
,
22 Oct 2015
:
“‘
Significantly higher
’
supply of industrial space expected till end 2016
:
JTC
”.
Mr Kelvin Lim
Executive Chairman &
Group Managing Director
9
