Management Discussion & Analysis
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Analysis of Operating Results

*Distributable Income calculates from net increase in net assets from operations, excluding net unrealized gain from changes in investment value.

Total Income

In 4Q2017, FUTUREPF had total income of 255.3 million baht, which decreased by 1.9 million baht or 1% from the same period of last year. It was mainly driven from:

  1. Decrease in rental income by 1.2 million baht. Because FUTUREPF had revenue from shop area decreased by 2.8 million baht or 2%, mainly resulted from the drop in average occupancy rate of this quarter from 99% to 97%. However, revenue from common area increased by 1.7 million baht or 2%, because of the increase in average occupancy rate from 85% to 86%.
  2. Interest income and other income became lower by 0.7 million baht.

Comparing with 3Q2017, total income decreased by 1.6 million baht or 1%, mainly resulted from rental discount for mini-shop in 3rd floor, which affected by economic recession.

In 2017, FUTUREPF had total income of 1,027.2 million baht, which increased by 39.8 million baht or 4% from the last year. This was mainly due to the increase in rental income as follows;

  1. revenue from shop area increased by 26.6 million baht or 4%, mainly due to the growth of average rental rate of Y2017 by 2% and the increase in average occupancy rate from 95% to 97% and the 2% growth of average rental rate.
  2. revenue from common area increased by 12.6 million baht or 4%, mainly due to the growth of average occupancy rate of Y2017 from 84% to 86%.

Total Expenses

In 4Q2017, FUTUREPF had total expenses of 57.1 million baht, which increased by 6.2 million baht or 12% compared with the same period of last year. The main reasons were as follows:

  1. property expenses increased by 9.7 million baht or 50%, mainly due to the decrease in marketing expense in 2016 from the event cancellation during Oct - Dec16 (Halloween, Countdown , Christmas & New Year) as result from the passing of His Majesty King Bhumibol Adulyadej
  2. Fund management fee and expenses decreased by 3.0 million baht or 37%, mainly due to the decrease in interest expense.

Comparing with 3Q2017, the fund had total expenses of 50.2 million baht, increased by 6.9 million baht or 14%, because of the event marketing expenses in December. However, property management fee dropped, resulting from the decrease of commission from leases that expired this year less than last year. The interest expense also lowered.

In 2017, the fund total expenses were 203.4 million baht, which decreased by 3.5 million baht or 2 % from last year. This was mainly due to the decrease in interest expense and the property commission fee.

Net Investment Income

In 4Q2017, FUTUREPF had net investment income of 198.2 million baht, which decreased by 8.1 million baht or 4% compared with the same period of last year. It was resulted from the increase in total expenses while rental income dropped. Therefore, FUTUREPF announced the dividend payment of 178.5 million baht, or 0.337 baht per investment unit. It was decreased from 0.351 baht per investment unit in 4Q2016.

Compared with 3Q2017, FUTUREPF had net investment income decreased by 8.5 million baht or 4%, due to the increase in the marketing expense for the end of year events.

In 2017, FUTUREPF had net investment income of 823.9 million baht, increased by 43.4 million baht or 6% compared with last year. It was resulted from the increasing in rental income while total expenses dropped. Therefore, the distributable income increased by 5% compared with the last year. This year, FUTUREPF announced dividend payment of 742.5 million baht (93.49% of distributable income) or 1.402 baht per unit which increased from 1.330 baht per unit in 2016.

Unrealized Gain (Loss) from Changes in Investment Value

In 4Q2017, FUTUREPF recorded unrealized loss from changes in investment value of 40.0 million baht compared with 3Q2017, resulted from changing in assumption for the valuation of investments align with current business. Moreover, the fund had capital expenditures for the improvement of the equipment and the renovation of leasable area of 1.0 million baht. Thus, the fund had net unrealized loss in property investment of 41.0 million baht.

In 2017, FUTUREPF recognized unrealized loss from changes in investment value by 26.0 million baht. Furthermore, there were the capital expenditures for the equipment improvement and the renovation of leasable area of 3.7 million baht. Therefore the net unrealized loss from changes in investment value was recorded at 29.7 million baht.

Profitability

In 4Q2017, net investment income margin was 78% and distribution income margin was 70%, which slightly decreased from the same period of last year. This was resulted from the lower in operating performance.

Compared with 3Q2017, net investment income margin and distribution income margin slightly decreased because of the drop in operating performance.

Net investment income margin and distribution income margin of 2017 slightly increased from the previous year to 80% and 72%, respectively. It was due to the operating performance improvement.

Balance Sheet

As of 31 Dec 2017, FUTUREPF had total assets of 7,342.7 million baht. The major assets consisted of the investments in properties of 6,965.0 million baht and the investment in securities and cash at banks of 324.7 million baht. Total liabilities were 527.3 million baht, mostly from deposits of rental and service and borrowing. In 2017, total liabilities decreased from 688.8 million baht as of the end of 2016 because FUTUREPF had the repayment of borrowings amounted to 170.0 million baht.

Therefore, FUTUREPF had net asset value 6,815.4 million baht or 12.8698 baht per unit, increased from 12.7862 baht per unit as of 31 December 2016.

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