financial statement announcement for the fourth quarter and full year ended 31...

FINANCIAL STATEMENT ANNOUNCEMENT FOR THE FOURTH QUARTER AND FULL YEAR ENDED 31 DECEMBER 2016

The Directors of Cambridge Industrial Trust Management Limited (“CITM”), as manager (“Manager”) of Cambridge Industrial Trust (“CIT”) are pleased to announce the unaudited results of the Group and CIT for the fourth quarter and full year ended 31 December 2016. CIT is a Singapore–based real estate investment trust constituted by the Trust Deed entered into on 31 March 2006 between CITM as the Manager of CIT and RBC Investor Services Singapore Limited as the Trustee of CIT, as amended and restated. CIT was listed on the Singapore Exchange Securities Trading Limited (“SGX-ST”) on 25 July 2006. CIT’s distribution policy is to distribute at least 90% of its annual distributable income, comprising income from letting of its properties after deduction of allowable expenses. The actual level of distribution will be determined at the manager’s discretion. As at 31 December 2016, CIT and its subsidiaries (the “Group”) have a diversified portfolio of 49 properties located across Singapore with a diversified tenant base of around 215 tenants across the following business sectors: logistics, warehousing, light industrial, general industrial properties, car showroom and workshop, and business park. The portfolio has a carrying value of approximately S$1.35 billion and a total gross floor area of approximately 8.4 million square feet. The Group’s results included the consolidation of its wholly-owned subsidiaries, Cambridge-MTN Pte. Ltd. (“Cambridge MTN”), Cambridge SPV1 LLP (“Cambridge LLP”) and Cambridge SPV2 Pte. Ltd. (“Cambridge SPV2”). The commentaries below are based on Group results unless otherwise stated.

CAMBRIDGE INDUSTRIAL TRUST FINANCIAL STATEMENT ANNOUNCEMENT FOR THE FOURTH QUARTER AND FINANCIAL YEAR ENDED 31 DECEMBER 2016

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Summary of Group’s Results

Inc/ Inc/

4Q2016 4Q2015 (Dec) FY2016 FY2015 (Dec)

S$'000 S$'000 % S$'000 S$'000 %

Gross revenue 27,783 28,489 (2.5) 112,087 112,244 (0.1)

Net property income 19,699 21,607 (8.8) 82,273 86,156 (4.5)

Amount available for distribution 13,003 14,781 (12.0) 54,476 61,813 (11.9)

Distribution per unit ("DPU") (cents) 0.996 1.139 (12.6) 4.173 4.793 (12.9)

Annual Distribution Yield (%)(a) - - - 7.73 8.88 (12.9)

Note:

(a) Annual Distribution Yield is computed based on the closing price of S$0.54 as at 30 December 2016, being the last trading day of the year.

Distribution and Book Closure Date Details

Distribution period 1 October 2016 to 31 December 2016

Distribution rate 0.996 cents per unit

Books closure date 3 February 2017

Payment date 28 February 2017

The Manager has determined that the distribution reinvestment plan (“DRP”) will not apply to the distribution for the period from 1 October 2016 to 31 December 2016.


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1(a) Income statement together with a comparative statement for the corresponding period of the immediately preceding financial year Statement of Total Return (4Q2016 vs 4Q2015)

Inc/ Inc/

Note 4Q2016 4Q2015 (Dec) 4Q2016 4Q2015 (Dec)

S$'000 S$'000 % S$'000 S$'000 %

Gross revenue (a) 27,783 28,489 (2.5) 27,111 27,849 (2.6)

Property manager's fees (1,300) (1,264) 2.8 (1,283) (1,247) 2.9

Property tax (b) (1,892) (1,440) 31.4 (1,892) (1,440) 31.4

Land rental (b) (2,251) (1,944) 15.8 (2,251) (1,944) 15.8

Other property expenses (b) (2,641) (2,234) 18.2 (2,636) (2,230) 18.2

Property expenses (8,084) (6,882) 17.5 (8,062) (6,861) 17.5


Management fees (c) (1,749) (1,784) (2.0) (1,749) (1,784) (2.0)

Trust expenses (d) (456) (383) 19.1 (448) (375) 19.5

Interest income (e) 18 20 (10.0) 17 20 (15.0)

Borrowing costs (f) (5,141) (5,304) (3.1) (5,141) (5,165) (0.5)

Non-property expenses (7,328) (7,451) (1.7) (7,321) (7,304) 0.2

Net income before distributable income 12,371 14,156 (12.6) 11,728 13,684 (14.3)

from subsidiary

Distribution income from subsidiary - - - 434 335 29.6

Net income after distributable income 12,371 14,156 (12.6) 12,162 14,019 (13.2)

from subsidiary

Gain on disposal of an investment (g) 533 - 100.0 533 - 100.0

property

Change in fair value of financial - (192) (100.0) - (192) (100.0)

derivatives

Change in fair value of investment (h) (45,056) (1,486) n.m (46,331) (1,426) n.m

properties

Total (loss)/return for the period before (32,152) 12,478 n.m (33,636) 12,401 n.m

income tax and distribution

Less: Income tax expense* - - - - - -

Total (loss)/return for the period after (32,152) 12,478 n.m (33,636) 12,401 n.m

income tax before distribution

Group Trust

*Amounts less than S$1,000


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Distribution Statement

Inc/ Inc/

Note 4Q2016 4Q2015 (Dec) 4Q2016 4Q2015 (Dec)

S$'000 S$'000 % S$'000 S$'000 %

Total (loss)/return for the period after (32,152) 12,478 n.m (33,636) 12,401 n.m


Net effect of non-taxable items (i) 45,155 2,303 n.m 46,639 2,380 n.m

Net income available for 13,003 14,781 (12.0) 13,003 14,781 (12.0)

distribution for the period

Distribution per unit (cents):

For the period (j) 0.996 1.139 (12.6) 0.996 1.139 (12.6)

Annualised 3.984 4.519 (11.8) 3.984 4.519 (11.8)

Group Trust

n.m. – Not meaningful

Notes:

(a) Gross revenue comprises gross rental income, other income and straight line rent adjustments. Excluding the straight line rent adjustments for both periods, 4Q2016 adjusted gross revenue was S$27.4 million, S$0.6 million or 2.1% lower than the adjusted gross revenue in 4Q2015. The decrease was mainly attributed to several master lease expiries and subsequent conversion to multi-tenancy and divestment of properties, notwithstanding there were revenue contributions from the leasing up of properties and rent escalations in the existing portfolio.

(b) The increase in property tax, land rental and other property expenses (mainly the

maintenance costs) of S$1.2 million was the result of more buildings being converted from single-tenancy to multi-tenancy since 4Q2015, where CIT bears these costs.

The number of multi-tenanted buildings in the portfolio has increased from 20 to 23 since 4Q2015.

(c) The Manager has elected to receive its management fee wholly in cash for 4Q2016. The

management fee decreased due to lower assets under management, a result of property divestment proceeds being used to repay borrowings and fair value loss from independent valuation of investment properties.


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(d) Trust expenses comprised statutory expense, professional fees, compliance costs, listing fees and other non-property related expenses. Trust expenses for 4Q2016 were higher than 4Q2015 mainly due to higher legal and professional fees than last year.

(e) Interest income in 4Q2016 was lower as average cash balance during the quarter was

lower.

(f) Borrowing costs comprise loan interest expense and amortised loan transaction costs of establishing debt facilities. The total cost was S$0.2 million lower in 4Q2016 mainly due to a one-off write off of loan transaction cost upon repayment of the Club Loan in June 2015.

Please refer to 1(b)(ii) for more details on borrowings.

(g) This refers to disposal gain from the divestment of property at 2 Ubi View in 4Q2016.

(h) This refers to the fair value change on revaluation of the investment properties. The revaluation amount is inclusive of adjustments for straight line rent of S$0.9 million. The annual independent valuation exercise conducted in December 2016 by Edmund Tie & Company (for 24 properties) and Savills Valuation and Professional Services (S) Pte Ltd (for 25 properties) on CIT’s investment properties, resulted in fair value decrement of approximately S$44.2 million. These amounts are non-tax deductible and have no impact on the net income available for distribution.

(i) Non-taxable items (distribution adjustments)

4Q2016 4Q2015 4Q2016 4Q2015

S$'000 S$'000 S$'000 S$'000

Non-tax deductible items and other adjustments:

Trustee's fees 96 97 96 97

Transaction costs relating to debt facilities 623 577 623 536

Change in fair value of investment properties 45,056 1,486 46,331 1,426

Change in fair value of financial derivatives - 192 - 192

Professional fees 107 116 105 116

Straight line rent and lease incentives (421) (504) (209) (324)

Provision for doubtful debts - 175 - 175

Miscellaneous expenses 227 164 226 162

45,688 2,303 47,172 2,380

Income not subject to tax:

Gain on disposal of an investment property (533) - (533) -

Net effect of non-taxable items 45,155 2,303 46,639 2,380

Group Trust


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(j) The total distributable amount of S$13.0 million, based on 1,304.4 million units which were entitled to the distribution for the quarter, translates to a DPU of 0.996 cents for 4Q2016 which is 12.6% below the DPU in 4Q2015.


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Statement of Total Return (FY2016 vs FY2015)

Inc/ Inc/

Note FY2016 FY2015 (Dec) FY2016 FY2015 (Dec)

S$'000 S$'000 % S$'000 S$'000 %

Gross revenue (a) 112,087 112,244 (0.1) 109,427 110,248 (0.7)

Property manager's fees (b) (5,163) (4,791) 7.8 (5,093) (4,736) 7.5

Property tax (c) (6,984) (6,217) 12.3 (6,984) (6,217) 12.3

Land rental (c) (8,618) (7,362) 17.1 (8,618) (7,362) 17.1

Other property expenses (c) (9,049) (7,718) 17.2 (9,021) (7,682) 17.4

Property expenses (c) (29,814) (26,088) 14.3 (29,716) (25,997) 14.3


Management fees (7,060) (7,115) (0.8) (7,060) (7,115) (0.8)

Trust expenses (d) (1,870) (2,326) (19.6) (1,833) (2,335) (21.5)

Interest income (e) 47 149 (68.5) 47 149 (68.5)

Borrowing costs (f) (21,147) (22,220) (4.8) (21,142) (21,782) (2.9)

Non-property expenses (30,030) (31,512) (4.7) (29,988) (31,083) (3.5)

Net income before distributable income 52,243 54,644 (4.4) 49,723 53,168 (6.5)

from subsidiary/jointly-controlled entity

Share of profits in jointly-controlled (g) - 123 (100.0) - - -

entity

Distribution income from subsidiary/ (g) - - - 1,731 1,180 46.7

jointly-controlled entity

Net income after distributable income 52,243 54,767 (4.6) 51,454 54,348 (5.3)

from subsidiary/jointly-controlled entity

Gain on disposal of investment (h) 1,231 - 100.0 1,231 - 100.0

properties

Change in fair value of financial (i) (493) 395 n.m (493) 395 n.m

derivatives

Change in fair value of investment (j) (45,894) (2,645) n.m (46,774) (2,381) n.m

properties

Total return for the year before 7,087 52,517 (86.5) 5,418 52,362 (89.7)

income tax and distribution

Less: Income tax expense* - - - - - -

Total return for the year after 7,087 52,517 (86.5) 5,418 52,362 (89.7)


Group Trust

*Amounts less than S$1,000


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Distribution Statement

Note FY2016 FY2015 (Dec) FY2016 FY2015 (Dec)

S$'000 S$'000 % S$'000 S$'000 %

Total return for the year after 7,087 52,517 (86.5) 5,418 52,362 (89.7)


Net effect of non-taxable items (k) 47,389 7,203 557.9 49,058 7,358 566.7

Net income available for 54,476 59,720 (8.8) 54,476 59,720 (8.8)

distribution for the year

Distribution from capital - 2,093 (100.0) - 2,093 (100.0)

Total amount available for (l) 54,476 61,813 (11.9) 54,476 61,813 (11.9)

distribution for the year

Distribution per unit (cents):

For the year (m) 4.173 4.793 (12.9) 4.173 4.793 (12.9)

Group Trust

n.m. – Not meaningful

Notes:

(a) Excluding the straight line rent adjustment for both periods, FY2016 adjusted gross revenue was S$110.4 million, S$0.4 million or 0.3% higher than the adjusted gross revenue in FY2015. The increase was mainly due to full period revenue contribution from property acquisitions and completion of AEIs in the prior year and the leasing up and rent escalations of several properties in the existing portfolio, offset by the negative effect of master lease expiries and divestments.

(b) Property manager’s fees for FY2016 were higher by S$0.4 million over FY2015 largely due

to the higher marketing commission incurred for securing new leases and lease renewals for the properties and as a result of higher rental income in (a).

(c) Net property income decreased by 4.5% to S$82.3 million, due mainly to:

loss of revenue during the transition phase of the property moving from a single-

tenant to a multi-tenant building;

increase in property operating expenses (property tax, land rental and maintenance costs in other property expenses), as a result of the ongoing conversion of assets from single-tenancy to multi-tenancy; and

property divestments during the year.


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(d) Trust expenses for FY2016 were S$0.5 million lower than FY2015 as FY2015 trust

expenses included non-recurring legal and professional fees relating to acquiring the remaining 40% partnership interest in Cambridge LLP from Oxley Projects Pte. Ltd., revising of performance fee structure and in relation to the EGM held in that year.

(e) Interest income was lower in FY2016 as average cash balance during the year was lower.

(f) Borrowing costs comprise loan interest expense and amortised loan transaction costs of establishing debt facilities. The total borrowing costs decreased by S$1.1 million in FY2016. While the amortised loan transaction costs were lower in FY2016, interest costs increased due to higher borrowings required to fund AEI/capex payments during the year.

Please refer to 1(b)(ii) for more details on borrowings.

(g) Cambridge LLP became a subsidiary of the Group on completion of the Cambridge LLP Acquisition on 20 March 2015 and, accordingly, its results were consolidated from this date.

(h) This refers to the disposal gain from the divestment of property at 23 Tuas Ave 10 and 2

Ubi View in FY2016.

(i) The change in fair value of financial derivatives represented the change in fair value of interest rate swaps which were entered into to hedge interest rate risk on the floating rate loans. The Interest swap was unwound in 2Q2016. In accordance with FRS 39 Financial Instruments, the fair value change on interest rate swaps is recognised in the Statement of Total Return. It is non-tax deductible and has no impact on the net income available for distribution.

(j) This refers to the fair value change on revaluation of the investment properties. The revaluation amount is inclusive of adjustments for straight line rent of S$1.7 million. The annual independent valuation exercise conducted in December 2016 by Edmund Tie & Company (for 24 properties) and Savills Valuation and Professional Services (S) Pte Ltd (for 25 properties) on CIT’s investment properties, resulted in fair value decrement of approximately S$44.2 million. These amounts are non-tax deductible and have no impact on the net income available for distribution.


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(k) Non-taxable items (distribution adjustments)

FY2016 FY2015 FY2016 FY2015

S$'000 S$'000 S$'000 S$'000

Non-tax deductible items and other adjustments:

Management fees payable in units - 2,665 - 2,665

Acquisition fees paid in units - 60 - 60

Trustee's fees 384 385 384 385

Transaction costs relating to debt facilities 2,488 3,984 2,483 3,899


Change in fair value of financial derivatives 493 (395) 493 (395)

Professional fees 343 580 327 555

Straight line rent and lease incentives (1,729) (2,830) (909) (2,266)

Share of profits in jointly-controlled entity - (123) - -

Distribution income from jointly-controlled entity - 156 - -


Miscellaneous expenses/(income) 747 (99) 737 (101)

48,620 7,203 50,289 7,358

Income not subject to tax:

Gain on disposal of investment properties (1,231) - (1,231) -

Net effect of non-taxable items 47,389 7,203 49,058 7,358

Group Trust

(l) Total amount available for distribution for the period comprised:

FY2016 FY2015

S$'000 S$'000 %

Taxable income 54,476 59,720 (8.8)

Capital - 2,093 (100.0)

Total amount available for distribution

for the year

54,476 61,813 (11.9)

Group and Trust

(m) The total distributable amount of S$54.5 million, based on units which were entitled to the distribution for the year, translates to a DPU of 4.173 cents for FY2016 which is 12.9% below the DPU for FY2015. However, if one-off items such as capital distributions and management fees in units are excluded from FY2015, DPU for FY2016 would have been 5.7% lower than DPU for FY2015.


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1(b)(i) Statement of Financial Position, together with comparatives as at the end of the immediately preceding financial year

Note 31-12-16 31-12-15 31-12-16 31-12-15

S$'000 S$'000 S$'000 S$'000

Assets

Non-current assets

Investment properties (a) 1,332,000 1,377,400 1,314,000 1,339,100

Investment in subsidiaries (b) - - 25,206 25,206

1,332,000 1,377,400 1,339,206 1,364,306

Current assets

Investment properties held for divestment (a) 22,000 40,600 - 40,600

Trade and other receivables (c) 9,278 9,652 9,867 9,564

Derivative financial instruments (d) - 604 - 604

Cash and cash equivalents (e) 3,699 2,656 2,517 2,231

34,977 53,512 12,384 52,999

Total assets 1,366,977 1,430,912 1,351,590 1,417,305

Liabilities

Current liabilities

Trade and other payables (f) 21,464 24,004 21,384 23,806

21,464 24,004 21,384 23,806

Non-current liabilities

Trade and other payables (f) 8,894 8,743 8,664 8,742

Interest-bearing borrowings (g) 509,590 525,254 509,590 525,254

518,484 533,997 518,254 533,996

Total liabilities 539,948 558,001 539,638 557,802

Net assets 827,029 872,911 811,952 859,503

Represented by:

Unitholders' funds 827,029 872,911 811,952 859,503

Group Trust


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Notes:

(a) The total carrying value of investment properties was S$1,354.0 million as at 31 December 2016. The net decrease during the year was mainly attributable to:

property divestments of S$25.6 million;

revaluation decrement arising from independent valuation of properties in December 2016 of S$44.2 million; net of

capital expenditure and asset enhancement initiatives of S$5.8 million

As at 31 December 2016, an investment property was classified as investment properties held for divestment. This classification is required by FRS 105 – Non-current Assets held for Sale and Discontinued Operations as the divestment is planned within the next 12 months from the reporting date.

(b) At the Trust level, the cost of investment in wholly-owned subsidiaries comprises,

Cambridge LLP, Cambridge MTN and Cambridge SPV2, which are eliminated at the consolidated level.

(c) Trade and other receivables were S$0.4 million lower largely due to the receipt of

insurance claims.

(d) Derivative financial instruments, entered into to hedge the interest rate risk on the floating rate loans, were unwound in 2Q2016.

(e) Cash and cash equivalents increased by S$1.0 million as at 31 December 2016 mainly due

to the collection of rent arrears and the timing of the capex payments.

(f) The trade and other payables decreased by S$2.4 million mainly due to the payment of historical performance fees and refund of retention monies to project vendors.

Trade and other payables included security deposits of S$3.8 million (current) and S$8.9 million (non-current) and historical performance fees payable of S$1.3 million (current).

The payment for the total of the base fees and historical performance fees is capped at 0.8% of the CIT’s total deposited property value per annum under the Trust Deed. The amount in excess of the fee cap has been carried forward for payment in future half year periods, in January and July. Full settlement of the performance fee payable is expected in January 2017.

(g) Borrowing are stated net of unamortised transaction costs. The decrease in the interest-bearing borrowings as at 31 December 2016 resulted from the loan refinancing in September 2016 to diversify the debt maturity profile.


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1(b)(ii) Aggregate amount of borrowings

Note 31-12-16 31-12-15

S$'000 S$'000

Secured borrowings (a)

Amount payable after one year - 100,000

Less: Unamortised loan transaction costs - (892)

Total secured borrowings - 99,108

Unsecured borrowings (b)

Amount payable after one year 512,500 428,500

Less: Unamortised loan transaction costs (2,910) (2,354)

Total unsecured borrowings 509,590 426,146

Total borrowings 509,590 525,254

Group and Trust

Details of borrowings and collateral: (a) Secured borrowings

The Group’s secured borrowings, S$100 million term loan facility maturing in April 2017, was fully repaid in September 2016. The seven investment properties previously mortgaged under this term loan facility were unencumbered following the loan repayment.

(b) Unsecured borrowings

The unsecured borrowings of the Group comprise:

(i) the following notes issued under its S$750 million Multicurrency Debt Issuance Programme:

S$30 million six-year Singapore Dollar MTN in series 002 (the “Series 002 Notes”) issued in April 2014 and maturing in April 2020. The Series 002 Notes have a fixed interest rate of 4.10% per annum payable semi-annually in arrears;

S$155 million four-year Singapore Dollar MTN in series 003 comprising Tranche 1 S$100 million Notes issued in November 2014 and Tranche 2 S$55 million Notes issued in January 2015 respectively. These notes tranches, which were issued and consolidated to form a single series (the ”Series 003 Notes), have a fixed interest rate of 3.50% per annum payable semi-annually in arrears and mature in November 2018;


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S$130 million five-year Singapore Dollar MTN in series 004 (the “Series 004 Notes”) issued in May 2015 and maturing in May 2020. The Series 004 Notes have a fixed interest rate of 3.95% per annum payable semi-annually in arrears; and

S$50 million seven-year Singapore Dollar MTN in series 005 (the “Series 005 Notes”) issued in May 2016 and maturing in May 2023. The Series 005 Notes have a fixed interest rate of 3.95% per annum payable semi-annually in arrears.

(ii) 4-year unsecured loan facility maturing in June 2019 (“TLF1”) consisting of:

Facility A: S$100 million term loan facility at a fixed interest rate of 3.60% per annum for 3.5 years from the date of loan drawn down; and

Facility B: S$50 million revolving credit facility at an interest rate of margin plus swap offer rate.

A total of S$100.0 million was drawn down on the TLF1 as at 31 December 2016.

(iii) 4.75-year unsecured loan facility maturing in June 2021 (“TLF2”) consisting of:

Facility A: S$25 million term loan facility at an interest rate of margin plus swap offer rate, for 4.75 years from the date of loan drawn down; and

Facility B: S$75 million revolving credit facility at an interest rate of margin plus swap offer rate.

A total of S$47.5 million was drawn down on the TLF2 as at 31 December 2016.

(c) Unencumbered investment properties

As at 31 December 2016, the Group has 49 unencumbered investment properties with a combined carrying value of approximately S$1.4 billion, representing 100% of the investment properties by value.


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1 (c) Statement of Cash Flows

Note 4Q2016 4Q2015 FY2016 FY2015

S$'000 S$'000 S$'000 S$'000

Cash flows from operating activities

Total (loss)/return for the period/year after income tax (32,152) 12,478 7,087 52,517

before distribution

Adjustments for:

Interest income (18) (20) (47) (149)

Borrowing costs 5,141 5,304 21,147 22,220

Management fees payable in units - - - 2,665

Acquisition fees paid in units - - - 60

Share of profits in jointly-controlled entity - - - (123)

Gain on disposal of investment properties (533) - (1,231) -


Change in fair value of financial derivatives - 192 493 (395)


Operating income before working capital changes 17,494 19,615 73,343 79,615

Changes in working capital

Trade and other receivables (214) (1,073) (2,524) (1,630)

Trade and other payables 786 3,619 (2,220) 1,311

Income tax paid - - (54) (59)

Net cash generated from operating activities 18,066 22,161 68,545 79,237

Cashflows from investing activities

Net cash outflow on purchase of investment properties (a) - (82) - (19,470)

Capital expenditure on investment properties (1,237) (3,438) (5,595) (21,158)

Proceeds from disposal of investment properties 10,500 - 27,000 -

Payment for divestment costs (67) - (169) -

Acquisition of subsidiary - - - (10,582)

Interest received 18 20 47 149

Distribution income from subsidiary/ 433 650 1,204 930

jointly-controlled entity

Net cash generated/(used in) investing activities 9,647 (2,850) 22,487 (50,131)

Cash flows from financing activities

Equity issue costs paid - (59) (145) (278)

Proceeds from borrowings - 11,000 111,000 338,000

Borrowing costs paid (8,359) (8,021) (20,908) (20,664)

Repayment of borrowings (13,500) (16,239) (127,000) (301,239)

Distributions paid to Unitholders (b) (12,875) (11,906) (52,936) (48,369)

Net cash used in financing activities (34,734) (25,225) (89,989) (32,550)

Net (decrease)/increase in cash and cash equivalents (7,021) (5,914) 1,043 (3,444)

Cash and cash equivalents at beginning of the 10,720 8,570 2,656 6,100

period/year

Cash and cash equivalents at end of the period/year 3,699 2,656 3,699 2,656

Group


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Notes: (a) Net cash outflow on purchase of investment properties (including acquisition related

costs)

4Q2016 4Q2015 FY2016 FY2015

S$'000 S$'000 S$'000 S$'000

Investment properties acquired - - - (19,133)

Acquisition related costs - (82) - (337)

Net cash outflow - (82) - (19,470)

Group Group

(b) Non cash transactions

The distributions paid to Unitholders for FY2016 excluded the 6.7 million units (approximately S$3.3 million) issued in 1Q2016 as part payment of distributions pursuant to the DRP for 4Q2015.


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1(d)(i) Statement of Movements in Unitholders’ funds (4Q2016 vs 4Q2015)

4Q2016 4Q2015 4Q2016 4Q2015

S$'000 S$'000 S$'000 S$'000

Balance at beginning of period 872,056 872,396 858,463 859,065

Operations

Total (loss)/return for the period after income tax (32,152) 12,478 (33,636) 12,401

before distribution

Net (decrease)/increase in net assets resulting (32,152) 12,478 (33,636) 12,401

from operations

Unitholders' transactions

Issuance of units pursuant to:

- Distribution Reinvestment Plan - 3,647 - 3,647

Equity costs pursuant to:

- Distribution Reinvestment Plan - (57) - (57)

Distributions to Unitholders (12,875) (15,553) (12,875) (15,553)

Net decrease in net assets resulting (12,875) (11,963) (12,875) (11,963)

from Unitholders' transactions

Balance at end of the period 827,029 872,911 811,952 859,503

Group Trust


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Statement of Movement in Unitholders’ funds (FY2016 vs FY2015)

FY2016 FY2015 FY2016 FY2015

S$'000 S$'000 S$'000 S$'000

Balance at beginning of year 872,911 866,333 859,503 853,080

Operations

Total return for the year after income tax before 7,087 52,517 5,418 52,362

distribution

Net increase in net assets resulting from operations 7,087 52,517 5,418 52,362


Issuance of units pursuant to:

- Management fees paid in units - 2,665 - 2,665

- Distribution Reinvestment Plan 3,288 14,565 3,288 14,565

- Acquisition fees paid in units - 60 - 60

Equity costs pursuant to:

- Distribution Reinvestment Plan (33) (295) (33) (295)

Distributions to Unitholders (56,224) (62,934) (56,224) (62,934)

Net decrease in net assets resulting from (52,969) (45,939) (52,969) (45,939)


Balance at end of the year 827,029 872,911 811,952 859,503

Group Trust

1(d)(ii) Details of any changes in the units

4Q2016 4Q2015 FY2016 FY2015

Units Units Units Units

Issued units at the beginning of 1,304,434,416 1,290,338,256 1,297,775,187 1,269,029,508

period/year

Issue of new units pursuant to:

- Management fees paid in units - 1,429,730 - 6,475,026

- Distribution Reinvestment Plan - 6,007,201 6,659,229 22,184,731

- Acquisition fees paid in units - - - 85,922

Total issued units at the end of the 1,304,434,416 1,297,775,187 1,304,434,416 1,297,775,187

period/year

Trust


19

1(d)(iii) To show the total number of issued shares excluding treasury shares as at the end of

the current financial period, and as at the end of the immediately preceding year.

The total number of issued units, excluding treasury units, as at the end of the current and the preceding financial periods are disclosed in 1(d)(ii). There were no treasury units acquired since the date of listing of CIT on 25 July 2006.

1(d)(iv) A statement showing all sales, transfers, disposal, cancellation and/or use of treasury

shares as at the end of the current financial period reported on.

Not applicable. 2 Whether the figures have been audited or reviewed, and in accordance with which

auditing standard or practice.

The figures have not been audited or reviewed by our auditors. 3 Where the figures have been audited or reviewed, the auditors' report (including any

qualifications or emphasis of matter).

Not applicable. 4 Whether the same accounting policies and methods of computation as in the issuer's

most recently audited annual financial statements have been applied.

The Group has applied the same accounting policies and methods of computation in the preparation of the financial statements for the current reporting period, which are consistent with those described in the audited financial statements for the financial year ended 31 December 2015.

5 If there are any changes in the accounting policies and methods of computation, including any required by an accounting standard, what has changed, as well as the reasons for, and the effect of, the change.

Please refer to item 4 above.


20

6 Earnings per unit (“EPU”) and distribution per unit (“DPU”) for the period/year

Note 4Q2016 4Q2015 FY2016 FY2015

EPU

Total (loss)/return after income tax before (32,152) 12,478 7,087 52,517

distribution for the period/year (S$'000)

Weighted average number of units ('000) 1,304,434 1,292,931 1,303,361 1,284,155

Basic and diluted EPU (cents) (a) (2.465) 0.965 0.544 4.090

DPU

Total amount available for distribution 13,003 14,781 54,476 61,813

for the period/year (S$'000)

Applicable number of units for calculation 1,304,434 1,297,775 1,305,440 1,289,652

of DPU ('000)

DPU (cents) (b) 0.996 1.139 4.173 4.793

Group

Notes:

(a) The basic EPU was calculated using total (loss)/return after income tax before

distribution for the period/year, which included the fair value change in financial derivatives and investment properties and gain on disposal of investment properties, and the weighted average number of units in issue during the period/year. The basic and diluted EPU were the same as there were no dilutive instruments in issue during the period/year.

(b) DPU was calculated using the total amount available for distribution and the number of units entitled to distribution during the period/year.

7 Net asset value (“NAV”) per unit based on units issued at the end of the period

Note 31-12-16 31-12-15 31-12-16 31-12-15

NAV (cents) (a) 63.4 67.3 62.2 66.2

TrustGroup


21

Note:

(a) NAV per unit was calculated based on the number of units issued and issuable as at

the end of the respective period/year. The decrease was due to the diminution in fair value of investment properties as at 31 December 2016 and the dilution from units issued in 1Q2016 as part payment of the distribution pursuant to the DRP for 4Q2015.

8 Review of the performance

The review of the performance is found in Section 1(a) – Statement of Total Return and Distribution Statement and Section 1(b)(i) – Statement of Financial Position.

9 Review of the performance against Forecast/Prospect Statement

The Group has not disclosed any forecast to the market.


22

10. Commentary on the significant trends and competitive conditions of the industry in

which the group operates and any known factors or events that may affect the group in the next reporting period and the next 12 months.

Significant trends and competitive conditions

Based on advance estimates by the Ministry of Trade and Industry (“MTI”), the Singapore economy grew by 1.8% on a year-on-year (“y-o-y”) basis in the fourth quarter of 2016, up from 1.2% in the previous quarter. On a quarter-on-quarter seasonally-adjusted basis, it expanded by 9.1%, a reversal from the 1.9% contraction in the third quarter of 2016. The manufacturing sector expanded by 6.5% on a y-o-y basis, an improvement as compared to the 1.7% expansion in the last quarter. Singapore’s Purchasing Managers’ Index (“PMI”) for December 2016 posted a reading of 50.6, up slightly from the 50.2 reading from the preceding month. This is the 4th consecutive month of expansion and the improvement can be largely attributed to a faster rate of increase in inventory holding, new export, new orders and factory output. The above readings indicated that the overall manufacturing sector have moderated in spite of the uncertainties in the global economy. Although macro-economic data appears more favourable and there seems to be an indication of stabilisation in the manufacturing sector, Colliers Research noted that industrialists are expected to remain conservative in their space requirements. New supply of industrial space (20 million square feet of new industrial space completions in 2016) continues to be significantly higher as compared to the annual average new supply of 14.7 million square feet (from 2011 to 2015), and may continue to put downward pressure on rentals. Measured by total rental revenue, approximately 21.5% of CIT’s leases are due for renewal in FY2017, of which only 6.0% (5 properties) of revenue is from single-tenanted buildings while 15.5% is from multi-tenanted buildings. This signals a positive shift in focus for the Manager as compared to the past few years where there was a higher proportion of single-tenanted buildings expiring. Out of the five single-tenanted buildings due for expiry in the second half of FY2017, the Manager currently expects to renew or enter into new leases for four properties and to divest the other. We expect the leasing market to remain increasingly competitive and for our portfolio performance to be impacted by the prevailing downward pressure on rents and uncertain economic conditions in the short to medium term. Nevertheless, the Manager will continue to focus on improving asset quality and increasing the occupancy rate in the current challenging leasing market.

___________________________________________ Reference from MTI Press Release dated 3 January 2017


23

Corporate Developments As announced on 18 January 2017, e-Shang Redwood has, through its subsidiary e-Shang Infinity Cayman, completed the acquisition of an aggregate indirect 80% stake in CITM from National Australia Bank and Oxley Global. ESR is a leading pan-Asia logistics real estate developer, owner and operator. ESR focuses on developing modern, institutional quality logistics and industrial warehouses across major gateway markets in Asia. As the new majority shareholder of the Manager, ESR is committed to evaluating opportunities that will maximise value for CIT unitholders by leveraging its asset and property management expertise to improve CIT’s current property performance as well as grow the portfolio by actively assisting the Manager to source accretive acquisition opportunities in Singapore and across the region. Management of Lease Expiries Measured by total rental revenue, approximately 21.5% of CIT’s leases are due for renewal in FY2017, of which 6.0% (5 properties) are for single-tenanted buildings and 15.5% are for multi-tenanted buildings. In respect of the five single-tenanted buildings due for expiry in the second half of FY2017, the Manager expects to renew or enter into new leases for four properties and divest one property. Looking ahead, pressures on rental terms are expected due to the softer economic environment and rental market. Nevertheless, the Manager will continue to focus on improving asset quality and increasing the occupancy rate in the current challenging leasing market.


24

11 Distributions (a) Current financial period Any distributions declared for the current financial period: Yes Name of distribution: Forty-fourth distribution for the period from 1 October 2016 to

31 December 2016 Distribution Type: Taxable income Distribution Rate: 0.996 cents per unit Par value of units: Not meaningful Tax Rate: Taxable income distribution

The distribution is made out of CIT’s taxable income. Unitholders receiving distributions will be subject to Singapore income tax on the distributions received except for individuals where the distribution is exempt from tax (unless they hold their units through partnership or as trading assets).

Books closure date: 3 February 2017 Date payable: 28 February 2017 The Manager has determined that the DRP will not apply to the distribution for the period from 1 October 2016 to 31 December 2016.


25

(b) Corresponding period of the immediately preceding year Any distributions declared for the previous corresponding financial period: Yes Name of distribution: Fortieth distribution for the period from 1 October 2015 to 31

December 2015 Distribution Type: Taxable income Distribution Rate: 1.139 cents per unit

Par value of units: Not meaningful Tax Rate: Taxable income distribution

The distribution is made out of CIT’s taxable income. Unitholders receiving distributions will be subject to Singapore income tax on the distributions received except for individuals where the distribution is exempt from tax (unless they hold their units through partnership or as trading assets).

12 If no distribution has been declared/ (recommended), a statement to that effect

Not applicable.

13 If the Group has obtained a general mandate from shareholders for IPTs , the aggregate

value of each transaction as required under Rule 920(1)(a)(ii). If no IPT mandate has been obtained, a statement to that effect.

The Group has not obtained any IPT mandate from the Unitholders. 14 CONFIRMATION PURSUANT TO RULE 720(1) OF THE LISTING MANUAL

The Manager confirms that it has procured undertakings from all Directors and Executive Officers (in the format set out in Appendix 7.7) pursuant to Rule 720(1) of the Listing Manual of the Singapore Exchange Securities Trading Limited.


26

ADDITIONAL INFORMATION REQUIRED FOR FULL YEAR ANNOUNCEMENT 15 Segmented revenue and results for business or geographical segments (of the group) in

the form presented in the issuer’s most recently audited financial statements, with comparative information for the immediately preceding year.

No business segment information has been prepared as all the properties are used

predominantly for industrial (including warehouse) purposes and are located in Singapore.

16 In the review of performance, the factors leading to any material changes in

contributions to turnover and earnings by the business or geographical segments. Not applicable. 17 Breakdown of revenue

Inc/

FY2016 FY2015 (Dec)

S$'000 S$'000 %

(a) Gross revenue reported for first half 56,660 55,286 2.5

(b) Total return after tax before distribution for first half year 26,329 25,354 3.8

(c) Gross revenue reported for second half 55,427 56,958 (2.7)

(d) Total (loss)/return after tax before distribution (19,242) 27,163 n.m

for second half year

n.m – Not meaningful


27

18 Breakdown of the total distributions for the financial year ended 31 December 2016 Annual distributions to Unitholders:

FY2016 FY2015

S$'000 S$'000

01-07-2016 to 30-09-2016 12,875 -

01-04-2016 to 30-06-2016 14,062 -

01-01-2016 to 31-03-2016 14,505 -

01-10-2015 to 31-12-2015 14,782 -

01-07-2015 to 30-09-2015 - 15,553

01-04-2015 to 30-06-2015 - 15,784

01-01-2015 to 31-03-2015 - 15,677

01-10-2014 to 31-12-2014 - 15,920

Total distributions to Unitholders(1) 56,224 62,934 Note:

(1) Distributions were partly paid by CIT issuing an aggregate of 6,659,229 units (FY2015: 22,184,731 units) amounting to S$3.3 million (FY2015: S$14.6 million), pursuant to its distribution reinvestment plan.

19 Confirmation pursuant to Rule 704(13) of the Listing Manual Pursuant to Rule 704(13) of the Listing Manual of the Singapore Exchange Securities

Trading Limited, the Board of Directors of Cambridge Industrial Trust Management Limited (the “Company”), as manager of Cambridge Industrial Trust, confirms that there are no persons occupying managerial positions in the company or any of its principal subsidiaries who are relatives of a Director or the Chief Executive Officer or substantial Unitholders of Cambridge Industrial Trust.


28

20 Interested Person Transactions (“IPTs”)

Name of Entity

Aggregate

value of all

IPTs during

the financial

year under

review

Note (a)

Aggregate

value of all

IPTs under

the IPT

mandate or

shareholders'

mandate for

IPTs under

Rule 920

during the

financial year

under review

Aggregate

value of all

IPTs during

the financial

year under

review

Note (a)

Aggregate

value of all

IPTs under

the IPT

mandate or

shareholders'

mandate for

IPTs under

Rule 920

during the

financial year

under review

S$'000 S$'000 S$'000 S$'000

Cambridge Industrial Trust Management

Limited (the "Manager")

Management fees paid and payable

- in cash 7,060 - 4,450 -

- in units - - 2,665 -

Acquisition fees paid relating to the

purchase of investment properties

- in cash - - 162 -

- in units - - 60 -

Disposal fees relating to the - - -

divestment of investment properties

- in cash 135 - - -

Cambridge Industrial Property

Management Pte Ltd (Subsidiary of

immediate holding company of the

Manager)

Property manager's fees paid and 3,294 - 3,282 -

payable

Lease marketing services commissions 1,708 - 1,803 -

paid and payable

Project management fees paid and - - 137 -

payable*

20152016


29

20 Interested Person Transactions (“IPTs”) (continued) Name of Entity

Aggregate

value of all

IPTs during

the financial

year under

review

Note (a)

Aggregate

value of all

IPTs under

the IPT

mandate or

shareholders'

mandate for

IPTs under

Rule 920

during the

financial year

under review

Aggregate

value of all

IPTs during

the financial

year under

review

Note (a)

Aggregate

value of all

IPTs under

the IPT

mandate or

shareholders'

mandate for

IPTs under

Rule 920

during the

financial year

under review

S$'000 S$'000 S$'000 S$'000

RBC Investor Services Trust Singapore

Limited (the "Trustee")

Trustee fees paid and payable 384 - 385 -

National Australia Bank Limited

(Related company of the Manager)

(Note (b))

Loan disbursed - - 13,125 -

Loan repaid 100,000 - 88,125 -

Interest expense paid and payable 1,565 - 3,753 -

Hedging costs paid/payable on partial - - 175 -

unwinding of interest rate swaps*

Oxley Projects Pte. Ltd.

(Related company of the Manager)

(Note (c))

Acquisition of 40% Partnership interest - - 10,967 -

in Cambridge LLP

20152016

*Amounts less than S$100,000 for FY2016.

There are no additional interested party transactions other than those disclosed above.


30

Note:

(a) Except as disclosed, these interested party transactions exclude transactions less than $100,000.

(b) National Australia Bank Limited (“NAB”) was the ultimate holding company of nabInvest

Capital Partners Pty Limited (“nabInvest Capital”) and was related to the Manager by virtue of nabInvest Capital’s indirect equity interest of 56% in the Manager.

(c) Oxley Projects Pte. Ltd., which was a subsidiary of the Oxley Global Limited (“Oxley Global”), was related to the Manager by virtue of Oxley Global’s indirect equity interest in the Manager of 24%

This release may contain forward-looking statements that involve assumptions, risks and uncertainties. Actual future performance, outcomes and results may differ materially from those expressed in forward-looking statements as a result of a number of risks, uncertainties and assumptions. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, competition from similar developments, shifts in expected levels of occupancy or property rental income, changes in operating expenses (including employee wages, benefits and training costs), governmental and public policy changes and the continued availability of financing in amounts and on terms necessary to support future CIT business. You are cautioned not to place undue reliance on these forward-looking statements, which are based on the Manager’s current view of future events. Any discrepancies in the tables included in this announcement between the listed amounts and total thereof are due to rounding.

By Order of the Board Cambridge Industrial Trust Management Limited (as Manager of Cambridge Industrial Trust) Company Registration No. 200512804G, Capital Markets Services Licence No. 100132-5 Shane Hagan Acting Chief Executive Officer 25 January 2017

financial statement announcement for the fourth quarter and full year ended 31...

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