Steadfast & Vibrant

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Steadfast & Vibrant Steadfast & Vibrant CapitaMall Trust Annual Report 2013 Steadfast & Vibrant CapitaMall Trust (CMT) remains dedicated to delivering sustainable results across its portfolio of quality shopping malls. Since listing, CMT’s portfolio has steadily grown. This ensures that Unitholders and investors can rely on CMT for steady returns. CMT is focused on owning shopping malls that are vibrant and in close proximity to public transport. They are predominantly located in suburban areas as well as in Singapore’s bustling downtown core. CMT has been unwavering in its commitment to maintaining strong and rewarding partnerships with tenants. Together with the tenants, CMT continues to deliver results based on the creation and off ering of entertaining and relevant lifestyle shopping experiences that serve shoppers’ aspirations and needs. Clarity Clarity enables us to enhance organisational performance through operational excellence and eff iciencies. Corporate Profile 03 Contents Financial Highlights 04 Letter to Unitholders 06 Year in Brief 14 Corporate Governance & Sustainability Trust Structure 18 Organisation Structure 19 Board of Directors 20 Trust Management Team 30 Property Management Team 31 Corporate Governance 32 Enterprise Risk Management 48 Investor & Media Relations 52 Unit Price Performance 54 Sustainability 57 People & Talent Management 62 Business Portfolio Review Details Growth Strategies 66 Portfolio at a Glance 106 Operations Review 68 Portfolio Summary 108 Financial Review 76 Portfolio Details 110 Capital Management 81 CapitaRetail China Trust 142 Independent Retail Market Overview 85 Financial Singapore REIT Sector 91 Statements Marketing & Promotions 93 Report of the Trustee 146 Tenants Spotlight 100 Statement by The Manager 147 Meeting Our Shoppers 102 Independent Auditors’ Report 148 Statements of Financial Position 149 Statements of Total Return 150 Distribution Statements 151 Statements of Movements in Unitholders’ Funds 153 Portfolio Statements 154 Statements of Cash Flows 159 Notes to the Financial Statements 161 Appendix Interested Person Transactions 223 Unitholders’ Statistics 224 Mall Directory 226 Corporate Information 227 Glossary 228 1 Corporate Profile CMT is the first Real Estate Investment Trust (REIT) listed on Singapore Exchange Securities Trading Limited (SGX-ST) in July 2002. CMT is also the largest REIT by market capitalisation and asset size in Singapore, with a market capitalisation and asset size of approximately S$6.6 billion and S$10.0 billion respectively as at 31 December 2013. CMT owns and invests in quality income-producing assets which are used, or predominantly used, for retail purposes primarily in Singapore. As at 31 December 2013, CMT’s portfolio comprised a diverse list of over 2,900 leases with local and international retailers and achieved a committed occupancy of 98.5%. CMT’s portfolio comprises 16 quality shopping malls, which are strategically located in the suburban areas and downtown core of Singapore. CMT also owns 122.7 million units in CapitaRetail China Trust, the first China shopping mall REIT listed on SGX-ST in December 2006. CMT has been assigned an ‘A2’ issuer rating by Moody’s Investors Service on 19 March 2013. The ‘A2’ issuer rating is the highest rating assigned to a Singapore REIT. CMT is managed by an external manager, CapitaMall Trust Management Limited, which is a wholly-owned subsidiary of CapitaMalls Asia Limited, one of Asia’s largest listed shopping mall developers, owners and managers. Vision Mission Creating Value To deliver stable distributions Maximising Returns and sustainable total returns Transforming Experiences to Unitholders. CMT’s vision embraces all our stakeholders. We rely on the continued and combined support of our Unitholders, business partners, tenants, shoppers and employees to achieve this vision and, in return, share with them the fruits of our success. 3 Financial Highlights PERFORMANCE AT A GLANCE GROSS REVENUE NET PROPERTY INCOME (S$ million) (S$ million) 729.2 502.7 661.6 445.3 630.6 418.2 581.1 399.1 552.7 376.8 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 DISTRIBUTABLE INCOME TOTAL ASSETS (S$ million) (S$ million) 356.2 9,888.7 10,017.5 316.9 9,172.2 301.6 294.8 8,125.9 282.0 7,423.0 2009 2010 2011 2012 2013 2009 2010 2011 2012 2013 4 Clarity CapitaMall Trust Annual Report 2013 GROUP 1 2009 2010 2011 2012 2013 Selected Statement of Total Return and Distribution Data Gross Rental Income (S$ million) 513.7 539.2 582.7 610.9 676.6 Car Park Income (S$ million) 14.3 15.5 17.6 19.1 20.5 Other Income (S$ million) 24.7 26.4 30.3 31.6 32.1 Gross Revenue (S$ million) 552.7 581.1 630.6 661.6 729.2 Net Property Income (S$ million) 376.8 399.1 418.2 445.3 502.7 Distributable Income (S$ million) 282.0 294.8 301.6 316.9 356.2 Selected Statement of Financial Position Data Total Assets (S$ million) 7,423.0 8,125.9 9,172.2 9,888.7 10,017.5 Total Borrowings 2 (S$ million) 2,243.0 2,916.9 3,483.8 3,706.1 3,567.2 Net Asset Value Per Unit 3 (S$) 1.54 1.53 1.56 1.64 1.71 Unitholders’ Funds (S$ million) 4,969.6 4,939.4 5,246.0 4 5,702.9 4 6,008.7 Market Capitalisation 5 (S$ million) 5,722.7 6,209.3 5,658.3 7,362.2 6,589.7 Portfolio Property Valuation (S$ million) 6,920.5 7,271.5 7,849.2 8,191.8 8,799.4 Key Financial Indicators Earnings Per Unit (cents) (2.23) 6 8.49 11.98 16.05 16.61 Distribution Per Unit (cents) 8.85 9.24 9.37 9.46 10.27 Gearing 30.2% 35.9% 38.4% 36.7% 35.3% Interest Coverage (times) 3.6 3.6 3.3 3.2 4.2 Management Expense Ratio 7 0.7% 0.7% 0.8% 0.8% 0.8% Unencumbered Assets as % of Total Assets 20.0% 36.3% 37.9% 77.5% 8 83.7% 8 Net Debt / EBITDA 9 (times) 6.6 6.8 7.4 6.9 6.5 Average Term to Maturity 10 (years) 1.7 2.6 2.7 3.9 11 3.6 Average Cost of Debt 3.5% 3.7% 3.5% 3.3% 3.4% 1 CMT Group includes the proportionate consolidation of the 40.00% interest in Raffles City Singapore, consolidation of 100.00% interest in CapitaRetail Singapore Limited and CMT MTN Pte. Ltd. (CMT MTN) and equity accounting of its associate, CapitaRetail China Trust. With effect from 30 May 2011, CMT Group also includes the proportionate consolidation of 30.00% interest in Infinity Mall Trust and Infinity Office Trust. 2 Based on principal sums only. 3 Excludes outstanding distributable income as at end of each period. 4 139,665,000 and 125,000,000 new units in CMT with gross proceeds of S$250.0 million each were issued via private placement exercises on 10 November 2011 and 30 November 2012 respectively. 5 Based on the closing unit price of S$1.80 on 31 December 2009, S$1.95 on 31 December 2010, S$1.70 on 30 December 2011, S$2.13 on 31 December 2012 and S$1.905 on 31 December 2013. 6 The negative Earnings Per Unit of 2.23 cents as at 31 December 2009 was mainly due to the revaluation deficit on investment properties. 7 Refers to the expenses of the Trust, excluding property expenses and finance costs but including performance component of CapitaMall Trust Management Limited’s management fees, expressed as a percentage of weighted average net assets. 8 Higher in 2012 mainly due to the repayment of commercial mortgage backed securities (CMBS) borrowings under Silver Maple Investment Corporation Ltd of S$783.0 million on 31 October 2012. Following the repayment, the properties mortgaged under the CMBS borrowings namely Tampines Mall, Junction 8, Funan DigitaLife Mall, IMM Building, Bugis Junction, Sembawang Shopping Centre and JCube were discharged and released. Higher in 2013 mainly due to the redemption and cancellation of the remaining S$98.25 million in principal amount of S$650.0 million 1.0% convertible bonds due 2013 (Convertible Bonds due 2013) at 109.31% of the principal amount upon maturity. Following the redemption and cancellation, the legal mortgage over The Atrium@Orchard had been discharged and released. 9 Net Debt comprises gross debt less temporary cash intended for refinancing and capital expenditure and EBITDA refers to earnings before interest, tax, depreciation and amortisation. 10 From 2009 to 2010, it was assumed that bondholders of Convertible Bonds due 2013 would exercise the put option in July 2011. In 2011 and 2012, it was assumed that bondholders of the Convertible Bonds due 2013 would hold to maturity on 2 July 2013. 11 Higher in 2012 mainly due to the long tenures of between six to 12 years for four series of Euro-Medium Term Notes and one series of Medium Term Notes issued under CMT MTN in 2012. 5 Letter to Unitholders CMT has delivered steadfast performance since its public listing in 2002. We will continue to drive sustainable growth through active lease management, asset enhancements, acquisitions and exploring greenfield developments. This strategy has helped us to survive through different economic cycles and deliver long-term sustainable performance for our Unitholders. (Left) Tan Wee Yan, Wilson, Chief Executive Officer | (Right) Danny Teoh Leong Kay, Chairman 6 Clarity CapitaMall Trust Annual Report 2013 Dear Unitholders, and exploring greenfield developments. This strategy CapitaMall Trust (CMT) delivered has helped us to survive through an increase in distributions different economic cycles and to Unitholders in 2013 despite deliver long-term sustainable a challenging global economy.
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