REGAL REIT issued a profit warning, expecting an annual adjusted loss of approximately HKD 90.6 million
REGAL REIT issued a profit warning, expecting an adjusted annual loss of approximately HKD 90.6 million for the year ending December 31, 2024, an improvement compared to the adjusted loss of HKD 127.6 million in 2023. The expected loss is mainly due to the decline in the valuation of the investment property portfolio and financial expenses caused by high interest rates. The company anticipates that it will not declare a final distribution for the year
According to the Zhitong Finance APP, REGAL REIT (01881) announced that it expects to incur a loss of approximately HKD 204.4 million before distributions to fund unit holders for the year ending December 31, 2024, compared to a profit of HKD 265.7 million for the fiscal year 2023.
The anticipated annual loss includes a fair value loss of HKD 128.8 million resulting from the decline in the valuation of REGAL REIT's investment property portfolio as of December 31, 2024 (2023: fair value profit of HKD 366.9 million).
Excluding the impact of this fair value change, REGAL REIT is expected to report a core operating loss of HKD 75.6 million in 2024, an improvement from last year's loss of HKD 101.2 million. The core operating loss in 2024 is primarily due to the Hong Kong Interbank Offered Rate (HIBOR) remaining at relatively high levels throughout the year, resulting in significant financial expenses from bank loans that are interest-bearing based on this rate.
Therefore, after adjustments for various non-cash items, REGAL REIT expects to report an adjusted loss of approximately HKD 90.6 million in 2024 (2023: adjusted loss of HKD 127.6 million). As a result, it is expected that no final distribution will be declared for the year
