] } } Judy: Hello, a very good morning to everyone. Welcome to Frasers Centrepoint Trust's first half FY2026 results briefing.

I have with me today the management team: Mr. Richard Ng, who is our CEO; Ms.

Annie Khwang, our CFO; as well as Ms. Pauline Lim, our Managing Director for Investment and Asset Management.

I'm sure we have lots to cover today, without further ado, can I pass it on to Richard to kick-start the briefing, please? Thank you.

Thanks Judy, and a very good morning to all of you. Thanks for joining us this morning again, and I figure that you guys probably have some time to go through the deck, we're just going to run through, and perhaps can spend a little bit more time on the Q&A part of it.

All right, Judy, let's go.

Yeah.

Once again, I'm very happy to share a set of strong results that we have delivered for this first half. If you look at all the numbers here, it's all positive, has grown, has improved.

Revenue, of course, came in pretty strong, more than 20%; NPI, likewise, more than 20%. Even for DPU, we grew by 1.4%.

If you look at the operating metrics as well, tenant sales increased by 3.2%; traffic has gone up; occupancy is again very resilient, very strong at 99.8%; rental reversion is also at 6.5% for this first half, right? In terms of the capital management side, Annie will go into a little bit more details, but just on a broad perspective, our leverage is about 40%, and for this quarter, our cost of fund is about 3.2%.

Next, we going to touch on the broader market perspective. The macroeconomics and retail market in Singapore, I'm not going to dwell too much on the economic indicators.

You guys pretty much aware as much as we do, but let's maybe perhaps look at the sales numbers. For retail sales in Singapore as a whole, we're looking at just January-February, because as you're aware, typically the SingStat, it's a little bit behind time, we try to compare on the same period of time.

That January-February is an average of, depending on which month is the Chinese New Year, for this, we normally put this two months together. On the average, Singapore retail sales grew by about 3.4%, and FCT is actually ahead of that at 3.5%.

If you also strip out the rest and just focus on the F&B, because there's a lot of conversations around this particular sector, the broader market saw 1% increase, but for FCT, we actually delivered 1.7% increase. That's where perhaps one of the differences, right?

You read a lot about F&B operators shutting and so on, it is not the fact that it's not across every mall, but maybe some are more affected than others. This is again strong numbers that you can look at in comparison with the broader market perspective.

In terms of rents for this quarter on quarter, suburban prime retail rents grew by 0.2%, and year on year grew by 1.4%. Next, in terms of financial highlights, I will then hand over to Annie.

Yeah. Thank you, Richard.

Good morning, everyone. I will go through the financial performance.

The gross revenue for 1H FY2026 stood at 221.9, which is an increase of 20.3% compared to the same time last year. The increase was mainly due to the Northpoint City South Wing acquisition in May 2025 last year and also higher passing rent across most malls.

This was partially offset by the AEI at Hougang Mall, as well as the divestment of Yishun 10 in September 2025. Property expenses for 1H 2026 is 20.5% higher compared to 1H last year.

Excluding the effect of Northpoint City South Wing and Hougang Mall, it is comparable to the corresponding period last year. Accordingly, our NPI for this 1H is higher by 20.2%.

There's a lower distribution from joint ventures for the 1H this year due mainly to the absence of the one-off dividend compared to the same time last year. The DPU for 1H is at 6.136 cents, which is 1.4% higher than last year.

This excludes an amount of 4.6 million, which has been retained for general corporate and working capital purposes. Next slide, please.

There are no significant movement in balance sheet position compared to 30th September 2025. The NAV and adjusted NAV increased to $2.25 and $2.19 [cents?]

, 2.19 respectively, mainly because of the effect of the mark-to-market recognized for the derivative financial instruments. Next check, please.

As at 31st March, our aggregate leverage is at 40 40%, which is 0.3 percentage point lower than last quarter. Interest coverage ratio remained healthy at 3.59 times.

Average cost of debt for the 6 months is at 3.3%, but for the quarter, it is 3.2%, which is a 30 basis point drop from last quarter. We have refinanced all the loans in FY2026 this quarter, as well as also partially refinanced some loans due in FY2029, therefore extending the weighted average debt maturity to 3.92 year as at 31st March.

The hedge ratio is lower at 66% due to the interest rate swap that Slide 11. Yeah.

There's no refinancing risk in FY2026. As mentioned earlier, I think we did a early refinancing for borrowing which was previously due in FY2029 by pushing it to FY2031.

With that, there is no more than 30% loan due in any one year. Next slide, please.

The DPU, 6.13 cents, for the first half will be paid on 29 May 2026. I will now hand over to Pauline for portfolio highlights.

Thank you, Annie. Good morning, everyone.

I'm very pleased to share a very strong set of operating performance for our portfolio. On this slide, you see the occupancy.

Portfolio occupancy on a year-on-year basis has improved by 1.7 percentage point to 99.8% as at the second quarter of this financial year. Just a deeper look into how the various assets have performed, you see that all our malls have delivered 100% or almost full committed occupancy.

The high occupancy and the positive rental reversions that I will show in the later slide are supported by very robust trading performance of our retailers, as well as good demand for quality spaces within the suburban space. Next slide, please.

Right, this slide shows a very strong broad-based improvement in top line and net profit across our portfolio, and this is the result of the continuous efforts to drive not just revenue productivity, but also to optimize costs in the face of inflationary pressures, right? You'll see that in terms of the NPI margin, our portfolio is actually yielding an NPI margin of 73%, and that has maintained if not improved on a year-on-year basis, right?

Next slide, please. Shopper traffic and sales also shows a positive picture.

Right, both traffic and sales have sustained growth from previous years into this financial year, and this is largely attributed to our focus on in-mall activation and also driving repeated visitations, right? All this focus on bringing people back to the mall, doing the sales conversion is yielding results, right?

We see good sales conversions as demonstrated by the improvement in sales in tandem with the growth in the shopper footfall. Next slide, please.

Rental reversions, happy to say that we are tracking ahead of our projection of mid-single-digit at the start of this financial year. If we look at the performance across the malls again, we do see positive rental reversion across all our malls and on top of that, also across all our trades for the first half of this financial year, right?

The other metric to highlight is tenant retention. Very strong tenant retention of 87%.

Again, this is a testament to the trading health of our existing retailers, right? A little bit of flavor on where some of the leasing demand is coming from.

We do see good traction coming from the top three trades would be F&B, beauty, healthcare, fashion, and accessories. Again, these three trades are one of the top five within our portfolio.

Again, this demonstrates how strong the portfolio is and how resilient the trading performance of the portfolio is. Next slide, please.

Lease maturity profile, you'll see that the lighter blue bar of 26% shows the amount of stock that is due for renewal or new lease at the start of this financial year. On a to-date basis, we have derisked more than half of this stock that is due for renewal.

It stands at about 11.6% as at the first half of this financial year. A proportion of this comprises anchors and mini-anchors, which have been largely derisked.

That gives a little bit of comfort in terms of what is the leasing risk for our portfolio in the remaining part of this financial year. The other metric, you see that there's no tall stack in the immediate two to three years, right?

The lease expiry profile is quite even, there's no concentration risk. In terms of the WALE, at 1.7 years is respectable in the context of our average three years lease term.

Next slide, please. This slide, we wanted to demonstrate that we are still cognizant of the fact that we need to bring excitement to our shoppers.

Over the course of this first half, we have brought into our portfolio 48 new-to-portfolio tenancies, right? This is across various malls and also various trades, right?

I believe some of you would have heard about the exit of GV, the cinema, from Tiong Bahru Plaza. Happy to provide a little bit of preview of what we are doing for that space.

In line with the emphasis of bringing experiential and play into our malls, we'll be bringing in X-scap8, which is an indoor active sports park. It will be first in Singapore.

We are very excited about the repositioning plans that we have for the space that is to be vacated by GV. Next slide, please.

I think for the next two slides, it's just a flavor of what we are doing to engage our shoppers, and also to enhance the experiential element, right? Activating our malls continue to be a key focus, and it's our responsibility as a landlord to bring footfall to sustain the performance of our retailers.

This remains a key priority. We believe in leveraging the strategic locations and connectivity of our malls within the heartlands to position ourselves as a key community hub, right?

A lot of the activities involves placemaking, involves engagement, enriching the experience of our shoppers. Next slide, please.

Next one. Yeah.

Another key partner for us would be our retailers, right? I think there's a lot of talk about cost inflation, impact to business sustainability.

This is a topic that is top of mind for many, especially with the war that is brewing in the Middle East, right? As landlords, we are committed to work with our retailers for them to trade better.

Here you see some examples of what we are doing as landlords to work with our retailers to help them manage their costs, and also to help them tap into a segment of the population, the silver population, which is actually growing, right? All this is with the view of ensuring the sustainability of our retailers, ensuring the productivity of their space.

Next slide, please. In this segment, I will touch about our pillar of enhancement growth, through AEIs, right?

Happy to update that Hougang Mall AEI is progressing well. To date, we have garnered about close to 90% of leases for the space that is affected by the AEI, and the overall AEI is on track to complete by the end of this financial year.

You see on this slide, we have provided a sample of some of the retailers that have signed with us and will be coming to the mall, and many of these are actually new to mall. If I look at the average of options that are new to a mall, we are looking at about close to one-third of the mall being refreshed by new retailers.

Next slide, please. You will recall that in the last quarter update, we were very happy to share that the AEI for NEX is coming to fruition.

Over the past quarter or so, happy to update that it has actually made good progress with about 40% of leasing pre-commitment just for the Phase 1, right? Another 28% is in advanced negotiation.

This brings us to close to 70% of the spaces that is undergoing the AEI, largely the ex-Isetan space, right? That will be coming up at the end of this calendar year.

Good leasing traction, good progress in terms of the AEI works, right? Isetan is now doing its final sale over this weekend, a lot of good deals, please come down to the mall and support us.

Next slide, please. With this, I will hand over to Judy to take us through the ESG section.

Thank you.

Good morning, everyone. I just have a couple of slides on the ESG part.

As you guys know, Frasers Property, as a group, is very focused on ESG, and along with that, one of the initiatives that we always have been embarking on is that community engagement, ensuring that our malls are vibrant social hubs where our shoppers and community can connect through various initiatives. Throughout the year, through targeted placemaking from the festive events, to the various health and sustainability programs, we continue to strengthen our engagement with the community and across various customer segments.

There's been a lot of talk about costs as well given the inflationary environment. We just wanted to kind of feature a couple of the initiatives that we have embarked on over time.

This is not something that is just drawn up overnight, for example. Essentially, it demonstrates how we are driving operational and cost efficiencies through leveraging technology, as well as ESG initiatives.

One of them, for example, is our smart facilities management where we're integrating both cleaning as well as security services with a outcome-based approach to reduce costs and yet, at the same time, still deliver good performance when it comes to our mall operations. Off top of this, of course, leveraging AI, very very common nowadays, across asset maintenance as well to increase productivity.

Again, on our lifts as well as escalators as well, there's a lot of remote monitoring and diagnostics in place. This helps to then support predictive maintenance, again all in line with achieving operational savings.

On the energy side, lots of questions on that recently. Pleased to share that we are fully hedged in terms of our electricity costs for FY2026 and partially for FY2027 as well.

Of course, over the past few years, we have been putting on so much of this solar energy on our malls itself, that's a three times increase, for example, just in FY2025. All of these measures put over the longer term has actually helped us to support the operational and cost savings.

All in, of course, these efforts also support a 100% in terms of our green financing, and we are, in terms of our properties as well, 100% are green-certified at the moment. All in all, underlying our strong ESG credentials.

I'll next pass on to Richard, who will cover the looking ahead section. Richard, please.

Thanks. Thanks, Judy, once again.

As my colleague has shared, for this first half, we have, in fact, delivered a very strong results thanks to everybody's effort from the asset management team, the property management team, that has worked very hard on the ground. It has shown through the numbers that you have seen.

Looking ahead, I think the questions will be how do we sense the market, what are we looking for, and where we are going for the next 6 months. This is where we kind of want to share some of our views as well.

Right, next slide, please. If fundamentally, you look at our business, right, it's about numbers.

As Pauline mentioned, we continue to want to drive traffic to the mall, and driving traffic, and then thereafter, we try and do a conversion. We have been doing very well on that front.

Our shopper traffic has continued to increase, and that has also contributed to the increase and improvement in sales for our tenants as well. That's what we've been doing on the ground.

On a macro perspective, again, it's very important for us to look at where, in terms of numbers as a whole, it's going. Happy to share, and some of you would have seen some of these numbers shared across various media, various announcements, speeches, and so on that our population is growing, right?

We know that we have crossed the 6 million mark, in fact, it's about 6.11 million as of June 2025. That's a growth of 1.2%.

Historically, the last 10 years, the average growth rate has been at 1%. While we don't produce enough, but we do still able to increase our population by about 1.2%.

That is good news for us, a business like ours, because we want numbers, the more people are available in Singapore, the chances are they would probably shop in one of our malls. At the same time, if you look at going ahead based on the master plan that has been shared previously, over the next six to seven years, we're looking at about 145,000 housing units, both public and private, that will be constructed, right?

Again, this are big numbers, and so far we've been kind of monitoring what is the progress like between 2022 and 2025. Again, those BTO that have been announced, about 25% of them are actually near our mall.

Again, this is where we're waiting for completion of these flats, and the catchment market is going to grow for us, right? If you look at slightly in a shorter term, 2025-2027, we're looking at about over 50,000 HDB flats going to be built.

Like what I said, big numbers, and these are the numbers that's going to continue to sustain the growth that we are seeing at our malls. Next slide, please, yeah.

Right, again, going back to the fundamentals of numbers, you have population, so that gives you the numbers, the traffic. Then what about spend, right?

This is again we want not only numbers comes through the mall, but we also want the numbers that comes with spending ability, right? Again, these are stats that has been widely shared that the median household income in Singapore have, in fact, exceeded $12,000 mark for the first time.

As the population median income growth, the propensity for them to spend has also improved, right? Again, that is also fundamentally supporting the sales across our portfolio.

Not only individually they are doing better in terms of the pay and the income, but I think the government has also been very supportive, very progressive in terms of coming forward to help as and when they see perhaps there are some challenges in certain sector of the market or certain sector of the population. Again, nothing new.

You guys would have seen this, but putting it a little bit more in terms of perspective, right? CDC vouchers, $500, is going to be distributed in June instead of January 2027.

As we all know, right, this has got an impact for us for our malls, because half of that can be used at our supermarkets. The other half, of course, can be used at the various HDB outlets and also hawker centers and so on.

Even despite the fact that 50% are not able to be used in our mall, we do see knock-on effects. Similarly, even the 50% that is so-called available only for supermarkets, right, you normally see a knock-on effect, and what do I mean by that?

What you see is now the household has additional $500 to spend, right, which in the past they really would have spent it on supermarkets, or markets or hawker centers and so on, but now with this $500, meaning that the $500 that they have previously kind of allocated for the same spending can be used for other things, right? Perhaps a little bit more non-necessity perhaps, maybe in terms of fashion accessories, in terms of footwear, and so on.

There is actually a knock-on effect, it's not just strictly mean that $250 goes to supermarket and that's it, and nobody else benefited. Based on our data, we've seen that every time when there's a distribution of CDC vouchers, we do see some knock-on effect, and that is where the team again will look at how can we get the tenants to participate, to be involved in any of such activities.

Beyond the CDC vouchers, there are also cash payments, there are also U-Save that has been earmarked. If you look at just on a very broad perspective, you add up all this, roughly, a household could get up to about $2,700, right, depending on the housing type and so on, potentially about $2,700 up to $2,700.

Again, not only income is growing, but there are also additional sources of funds that this population catchment that we are serving can tap on. Next slide, please.

Fundamentally, if we go back to basic, right, what are we all about, right? It's really about basic necessity, bread and butter that you need, essentials that you need on your day-to-day requirements.

Again, focusing very much on essentials. Our essential services made up about 54% of our GRI, close to 50% of our NLA space is actually occupied by this type of trades and products.

Growth in demand drivers, we spoke about just now: population, housing growth, median income growth, government support. With this basic essentials, growth drivers, plus, of course, demand-supply, right?

If you look at the supply side of things, over the next 2.5 years from now to end 2028, we're looking at about just slightly below 180,000 square feet of suburban space. In fact, none of them are actually the type of malls that is comparable to our portfolio, right?

They're about 90,000 square feet and so on, and some of them are actually smaller spaces. This is where you see how we believe that we continue to stay resilient.

We continue to see that tenants in our malls will be able to do well, right? Fundamentals: basic essentials, strong growth drivers, limited supply.

Next slide, please. If I could just sum it all up, what are we looking at, where are we focusing on?

I think pretty much we have not gone out of what we have always been focusing on. Enhancement growth, Pauline has shared.

We are very happy with the progress we have made at Hougang Mall, and again excited with the fact that NEX is going to start physical work. Even before the physical work has started, right, the traction in terms of leasing for this space that is going to be worked on has been pretty strong, 48% and again 40% and another 28% that's already in advanced negotiation, very strong numbers.

Acquisition is part of the growth. We continue to be disciplined.

We look for opportunities that fit our strategy. Again, as I always said, acquisition is opportunistic, right?

It's not something that you can really plan for, right? The third leg is organic growth.

This is bread and butter for us. We continue to work very hard trying to see how we can further improve the performance that we already have, very strong performance, drive traffic, drive sales, and that's where you could again be able to get the rental reversion that you're looking for, right?

Supply is very muted, so that kind of underpins the demand for spaces at our malls. Judy also mentioned about beyond looking at the revenue side, we are also very focused on the cost management perspective, right?

Proactive property management in terms of looking at cost management, in terms of actually looking at cost mitigation as well, right? Sometimes you may not see an immediate improvements in terms of the opex, but the question is what happens if you don't do it, right?

Sometimes it's about cost mitigation, cost avoidance. The last bit is about Annie and her team has been again also working very, very hard on managing our capital.

We see a lot of progress in that area as well. The overall cost of fund has come down.

Again, we are about 60-plus percent hedged. We'll continue to monitor the market and would look at hedging if and when it becomes something that is positive for us.

With that, I will kind of wrap up our presentation, happy to move to the Q&A section. Judy, back to you.

Yeah. Thanks, Richard.

We've got a number of analysts already lined up to ask questions, without further ado, let us start with Terence from J.P. Morgan.

Can I invite you to unmute yourself, please? Morning, Terence.

Hey, morning. Morning, Judy and Richard and team.

Just wanted to ask on perhaps two sets of questions. Actually, congrats on the good results.

Number one, on the financial side, could you talk a little bit more of the 4.3 million that was retained, and what are the plans for it? Will it be distributed in the second half of the year?

Also, any updated cost of debt guidance for the year? Then, I guess on the broader picture, this potential divestment of White Sands, maybe if management could walk us through what's the thinking behind it, and how, if any asset sale were to take place, how would some of these funds be redeployed?

Are you looking at acquisitions, and would this be in Singapore, overseas?

Terence, I will take the second question, and then perhaps Annie could help out in the respond to the first question. As you have seen the announcement we put out, I don't know, sometimes the media caught hold of news and they make a big deal out of that.

We're in talks, right? Just like most of our past transaction also was like.

Sometimes we start talking, but as the announcement has stated, it's still a conversation, discussion. Nothing has been fixed, nothing has been concluded.

Again, it's when things are done, things are really formalized, that's when we will come forward and share with all of you, right? As of now, it's conversations and discussions, there isn't anything definite at this point in time.

Your leader question is what could we do, right? Again, like what I say, sometimes investment, divestment are opportunistic, right?

If there are interest in our mall and we think that maybe we could look at something that's aligned with what we have always envisaged for an asset like this when it comes to maturity, and we do get somebody who knock on our door and say, "Look, this is something that potentially we could do," then we will start the conversation, right? Again it's opportunistic.

If it happens, then we can start looking at, for a start, our headroom will improve because that will bring our gearing down to about the 36 kind of range, so that gives us a little bit of headroom to then pursue opportunities when it comes our way, right? It's not something definite that we're looking at, okay, with this, and how we going to deploy the fund immediately.

Again, it's all opportunistic.

Sorry, maybe just to clarify, if you were to redeploy, would it still be a dominant mall in suburban Singapore, or would you consider other things like downtown, overseas, and other assets? Yeah.

The question is about maybe in terms of overseas, maybe a little bit straightforward, right? The question is, will we go overseas?

At the same time, we also ask ourselves, are we able to find good assets that has got similar attributes like what we have, and after you kind of do your risk-adjusted return, can you find opportunity that's better than what we can get in Singapore? I think probably not at this moment.

That's the reason why we will continue to stay focused in Singapore, right? That is quite clear for us, at least during this period of time and foreseeable future.

Whether we again do something in downtown or do something in suburban, again, depending on what's available. If you do know of something that's available, perhaps you can share with us, but at this point in time, we don't really am aware of anything that's available.

Again, fundamentally, I think we look at how does it fit into our portfolio, right, whether does it add value, are they having the same kind of attributes that we think gives us value in the longer term, something that we believe is sustainable, and if it makes sense, right, we can always look at that. Maybe Annie, yeah, Annie, the first question.

I take the first question. Hi, Terence.

The 4. 4.6 million that was retained, it actually came from our strong underlying performance of the portfolio, as well as on lower financing cost.

It's retained for various purpose: working capital, other initiatives, AEIs, and which also includes potentially release in the second half. The other question was the cost of debt, right?

We didn't change our guidance that was provided last quarter, it remains around 3.3%.

Thanks.

Thanks, Terence. Next up, we've got VJ from RHB.

VJ, good morning. Can you unmute yourself?

Thanks.

Yes. Hi.

Good morning, Richard and team. Couple of questions from me.

Firstly, in terms of the one-off JV income last year, can you remind us how much was it and what was the reason last year it was given? Also, I want to know a bit on the debt cost at the JV level and how is it tracking?

Annie, yeah.

The one-off dividend, that was in last year, there was some excess cash that was kept in GRPL, which is the excess cash is no longer required, we reassessed the cash position and know that we can make a one-off distribution up to the shareholder. It's one-off, we don't expect to have this in this year.

What was the other question again?

Debt cost at JV level, yeah.

Okay. We don't share specific debt costs at our JV level, but it's around, there's no new refinancing for the JV, it will be the same as what we have previously guided, which is around about 3 3-odd percent, yeah.

So. Got it.

If I can clarify again, if we strip off the one-off income, your JV income would have been higher year on year?

No, the one-off income was last year, not this year.

No, if I strip off the last year's one-off, would your JV income be higher year on year?

Yes. Yes, JV income is still higher year on year.

Got it. My second question is, last quarter, I think you mentioned something about Causeway Point transformation and then increasing the NLA and other.

Maybe is there any update on it? As it comes closer to RTS, are you seeing some tenant impact, or any conversation with tenants in terms of how they see this overall changes?

I think the quick answer is, VJ, we don't see that. In fact, the occupancy for Causeway Point remained very strong.

We're still getting renewal reversion that's very healthy, and each time they sign it's a three-year lease, so that has not actually deterred tenants from signing. Again, I think, like what we shared many times before, perhaps the view on this RTS has been overemphasized or overblown.

If you have been operating in Causeway Point for a very long time, you have been seeing this flow of people going to JB all the time, right? It's nothing new.

Perhaps maybe a little bit more, a little bit change, but again we shared before about the bigger picture. We expect more people to come to Woodlands because it's a connecting hub.

We are seeing growth in population, because as we speak, some BTOs just next to the mall is being constructed and will be completed soon. By and large, we don't see any issues with our leasing strategy for Causeway Point.

In terms of how we going to revitalize the mall, rejuvenate, redevelop the mall, and so on, not redevelop, but again doing AEI on the mall, we're hoping to be able to share some plans, but because we have to go through certain planning application and also getting in some of the key tenants that we wanted to showcase, that has kind of pushed back. We hope that by the next quarter, we can come out and show some of these ideas that we have for our Causeway Point going forward.

Unfortunately, I'm unable to share details at this point in time.

Got it. Thank you.

All the best. That's all, yeah.

Thanks, VJ. Next, we've got Geraldine from DBS.

Geraldine, can I invite you to unmute yourself? Good morning.

Hey, good morning, Richard and everyone. Maybe just three questions from me.

I guess first, if you look at transactions in the market, i12 Katong recently transacted. Did FCT look at the asset?

Because in terms of quantum, it looks quite close if you do sell White Sands to redeploy.

Of course, we look at all opportunities that are available in the market. Then we start to look at the numbers, and ask ourselves whether does this asset fit in in terms of attributes, right?

Typically, we want asset that is well-connected to key transportation hub like MRT station, bus interchange, the way the mall, the physical structure of the mall, can we still create value, what are some of the competition around that area. When we look at all these attributes, we decided that i12 is not something that we believe can add value to our existing portfolio, which is why we did not participate in the deal.

Very clear. Maybe just on the reversion, 6.5%, still very strong.

I believe the cinema backfilling, as well as the AEI completions would have added to this number. On a same-store basis, what would be a cleaner number?

Geraldine, just to be very clear, AEI numbers, those areas that we did AEI on are not included in this reversion, right? Reversions are only those spaces, existing spaces.

Any subdivision work and so on, we strip them out, because that's where you get numbers that is not stable numbers, right? We strip out all those, this is really, in a way, clean numbers.

The AEI would be a bigger boost to the 6.5%?

Yes.

In effect, okay. Maybe just last one on the cinema closure at Tiong Bahru, hearing all this noise for the past two years, what is Golden Village exit a cursor for further closures?

Of course, I cannot comment on GV's business strategy, but the fact that they took up a lease in Century Square, that goes to show that they still want to continue to operate in Singapore. Again, Tiong Bahru Plaza is one whereby, like what I say again, is it because of certain proximity, they feel that in that catchment market, having one at Great World is sufficient.

For us, we look at it more as an opportunity, right? Tiong Bahru Plaza, GV has not been really a key traffic driver.

It's not bringing in the level, the type of traffic that we wanted. We have been looking at this space, right?

I've shared with all of you before that even though they're operating, we are making plans for every one of the cinema spaces that we have to identify what could be the possibility. If they decide not to renew, they decide to exit, we have the plan quite quickly, right, which is why, when they announce that they're exiting, and we are able to backfill the space very quickly.

We're quite excited with this X-scap8 that's coming in, because I think that would be something new to the mall, something that we believe it's going to be able to drive more traffic than what Golden Village used to be able to do so.

Okay. Thanks, Richard, for all the color.

Thank you.

Thanks, Geraldine. Next, we've got Rachel from Macquarie.

Good morning, Rachel. Can you unmute yourself?

Thanks, Judy. Hi, morning, Richard and team.

Maybe just a few questions from me. Firstly, if I were to look at your tenant sales, could you give us some color?

Is it mainly coming from supermarket, and have you seen any softening coming to the March year?

March.

Yes. The numbers is for the first half.

We haven't really gotten the detailed number for beyond March, right, because normally the numbers comes in a little bit later, we only get it in May. Eyeball observation, we still see a very strong traffic flow, very busy at our malls.

We don't really see any softening from that perspective. What was your second question?

Sorry. Oh no, is it mainly coming from the supermarket?

Oh okay. Right, in terms of trade, maybe Pauline can also help out, but I believe some of the trade categories have contributed that include your F&B, supermarket is one, your beauty and healthcare.

Of course, jewelry is one of the trade that is doing really good business. Fashion and accessories, I believe, is also one of those categories.

Did I miss out anything, Pauline?

Maybe, Richard, I will provide a little bit more flavor on that. If you actually look at the slide that I presented earlier, in terms of tenant sales overall, we have actually achieved a 3.2% increase on a year-on-year basis, right?

With a further deep dive into the trades, maybe I will deal with the, say, the top five trades within our portfolio. We see that across our top five trades by GRI, the sales have actually improved or I think the only one that is maybe slower is fashion and accessories, but even that, it's quite flatish.

I hope that gives you a little bit more perspective on how our retailers are doing.

Got it. Thank you.

Then my next question is on utility costs. I think you mentioned you have hedged FY2026 then partially in 2027, right?

Just wondering how's the rate compared to last year's rate and 2027 versus the 2026?

Okay, 2026, all done. So 2027, we have done about 50%, right?

We continue to monitor the market. We still have another 50% to hedge, like what I said, we can't really give you fixed number right now, right?

Let's say we take pretty extreme condition and say, "Look, if let's say the forward rate goes up to about 120 US dollar per barrel," I'm talking about forward rate and not spot, right? Today you look at oil price is about 100, 110, but that's spot.

Forward rate is slightly different. Forward rate is where again, it is adjusted and the view is very different.

For example, yesterday, the forward rate is about $80, right? Never mind, even if we assume the forward rate is about 120, all right, the impact to our 2027 numbers, it's about 1% of the DPU.

I hope that give you a sense. That is to me is quite extreme, because I'm looking at forward and not spot.

Also to answer the question on whether the utilities costs have come down, I think we can say quite definitively for FY2026, because it's fully hedged, it has come down from FY2025.

Oh, do you have a rough quantum? 5% less than 10%, something?

Do I have a rough Yeah, go ahead.

Maybe I believe our utility cost is about 9% to 10% of the overall opex, probably we shave off maybe by half a percent from there.

Yeah.

Okay. That sounds good.

All right. Thank you.

Then maybe just very quickly on the reversion outlook. I think it's softened a little bit versus the last quarter, I think.

Moving forward, do you still see it moderating down further, or do you still expecting stronger reversions?

In fact, we spoke about this, and our guidance has always been looking at about mid-single. In fact, it came in much stronger than what we have guided.

Fundamentally is because our tenants at our malls continue to do well, which is why we were able to get that. We continue to guide that, in the longer term, more sustainable basis, it's a middle single-digit number.

Okay. All right.

Thanks, Richard and team. Thank you.

Thanks, Rachel. Next, can we have Terence from UBS to unmute yourself?

Good morning, Terence.

Good morning. Terence from UBS.

Just a question on the dispersion in rent-paying power across your tenants. There are articles online that says the local businesses are being priced out.

Is it the case where you have Chinese brands want to pay top dollar for your higher visibility storefronts and perhaps the local ones who can't keep up?

If you ask me in terms of ability to pay, yes, you're right that there are brands who come in, foreign brands that came in and prepared to be a little bit more aggressive. Maybe perhaps that's their business strategy.

They want to grow, they want to grow fast, they want to take position, right? For us, it's not a case of always going after the best rent, right?

If you look at our malls, if you visit our malls, you will find that in terms of the trade mix is well-planned, well-thought-out. We don't have any specific single cuisine that is actually taking significant number of outlets in our mall, because we believe that what we serve is a catchment market that consists of different races, people with different palate, people with different needs, and they don't want to eat the same thing every day.

We are very cognizant of the fact that when we plan our trade mix, we plan it in a way that we want to have a diversified, well-mixed kind of tenant mix that we have. The answer to you is, at least for our portfolio, what we can say, it's not always the case that we go for the top dollar.

If they are good, they are well-demanded, that's what the catchment market are looking for, yes, we will bring them in, but that has never been the first criteria that because they can pay better than our local brands, we will always take them first.

Okay. I presume then also means that people who pay top dollar isn't exactly driving your reversions in a disproportionate way.

Definitely not. That's just to be very clear.

Okay. Also, let's say on some of these foreign brands, are their sales necessarily performing well broadly across?

Because I do walk by some of these foreign brands and some of them require some times.

That goes back to my response, Terence, because again some of them they can pay, but is it really something that you want to have in your mall? Is it something that your catchment market, your shoppers are looking for?

Right, for us, we are quite cognizant of the fact we want to bring in trade that can do well, trade that our communities are looking for. Our leasing colleagues, they do a lot of groundwork, they understand certain products, certain brands may work in Singapore and certain brands may not work.

Maybe they can pay you, but it's not going to work, they're not going to be sustainable, right? That's not the point that we are looking for.

What we do is we try to pick brands that we believe can do well and can be sustainable.

Okay. I take it that as it stands, there isn't much of any underperforming trades, huh?

Of course, again, different trades perform differently over a period of time. Again, sometimes it's a case of the product that they have maybe after a while people get tired of it, then you change, whether it be local or foreign.

It doesn't matter, right? Over time, certain brand, you can see that slowly they are no longer attracting as bigger crowd as what they used to.

Maybe people got tired of the product or the services that they provide. Sometimes it's actually the services within different restaurant that you get will have also impact in terms of whether customers are coming back or not.

It cuts across whether it be international or local brands.

I don't know if you can help us simplify. I guess if you look across your tenant trade categories in terms of how their sales are trending, which are the more concerning ones?

I guess we can just put aside cinemas, but what else is there to think about on the downside part of things?

Pauline, you want to take that? Yeah.

Take this? Terence, like what I mentioned earlier, maybe I wasn't very clear, if I look at the top five trades in our portfolio by GRI, and these top five trades actually represent more than I think close to 80% of the GRI within our portfolio, these trades are doing better.

The only one that is maybe quite flat would be fashion and accessories, right? That gives you a little bit of comfort.

Now in terms of which are the trades that we do see a little bit of slowing in and so forth, it's like what you've correctly point out, the cinema trades, some of the entertainment-related trades, and also maybe the smaller trades within our portfolio, like, for example, books and so forth. All in all, I think in terms of the overall performance, we take comfort from the fact that the bulk of our retailers, i.e.

the top five, they are doing better, right, on a year-on-year basis.

Just wanted to chip in as well, Terence, but even having said that, right, F&B is doing well. Doesn't mean every single one of the F&B guys are doing proportionately well, right?

Some are doing better, some are doing okay, some may not be doing well, so that's where you do see that there's some consolidation, certain brands are moving out of our malls, or certain brands as we change out, right? We'll work on those that probably are not doing as well.

Again, what Pauline is giving you is a broad category, but I just wanted to highlight that even within the same category is disproportionate, right? Maybe perhaps that can answer your question, because you're probably wondering you read a lot about F&B closures and all that, why is it that our F&B sector is still thriving?

Got it. I guess my comment is that maybe the flip side of having limited underperformance across the portfolio is that there isn't much I'd say changeover of tenants to drive further improvements?

Not really. If we show that we have our retention of 87%, usually it's about 85%, 87%, we change out at least about 13% for this time round as well.

Typically, we will try to do a change out because especially if we don't see certain trade doing as well, or maybe it's slowing down, which is a signal that perhaps the shopper in the area is no longer looking for this product or this kind of cuisine, this food, we change out. What we also try to do is to bring freshness to the mall, right?

Retail center can never stay the same all the time, right? You need to bring in something new, something that is fashionable, trendy, something that people are looking forward, because say, for example, our malls are in Punggol, in Yishun, in Woodlands.

We want the shopper there to be able to also experience certain things that's new in the market instead of having to travel all the way to town to say maybe the latest yogurt or latest salad bar, right, that they read about, they want to have, right? The idea, it's about ability for us to also bring in some of these brands that is generating a lot of conversations as well.

Got it.

Then just to add on, the calibration is not just between trades, right, but it's also within the trade itself, right? Because we know what are the sales performance of all our retailers, right, and the focus is always on looking, okay, what is, say the top 10% to 20%, are there better options for that space, is there something better that we can offer to our retailers?

I hope that gives you an answer in terms of how focused we are on refreshing the trades, because it also comes back to the longer-term sustainability in the trading of our malls.

Got it. Thank you.

Thanks, Terence. Next, can we invite Rayson from HSBC to unmute yourself to ask questions?

Morning, Rayson.

Hi, morning, management team. Three questions.

Firstly, just a quick one on numbers here. Notice that under the other items for net tax adjustments, about 6.8 million, just wanted to get a sense, is the 4.6 that's retained for general working capital purposes being parked under this?

Because I think year-on-year-wise, in the first half of 2025, there's probably some that's due to Cathay being provisioned, but I wasn't expecting such a big number.

Rayson, that's correct. 4.6 is included in the 6.7 million.

I see. Got it.

That's clear. Thank you.

Then maybe just moving on to the next question. Firstly, maybe on the Causeway Point, just wanted to get a sense with regards to how much you see as an imperative to or urgency to embark on the AEI, because we are seeing Johor Bahru City Square already doing some AEI on the upper floors.

Then given that the expiries, the bulk of the expiries for the mall is probably occurring in FY2027, are we going to wait till FY2027 to expect maybe some AEI works, or maybe you'll be engaging your anchor tenants, your Metro, like what you did ahead of time?

Rayson, when we embark on any AEI, we will plan out and see what is the best opportune time for us to do it, and also working backwards to say what are all the planning process, the planning applications, the engagement with agencies, and so on that's going to take, right? It's not going to be like overnight that you can decide to do it.

We plan ahead, right? While RTS is going to open, it's not something that, oh, because it's opening, we must also complete our AEI on time.

I don't think that's the intent. What we also want to do is also want to observe, want to learn when that happens, what is any learning point that we can pick up from there, perhaps we can continue to fine-tune our trade mix as well.

Engaging with anchor tenants, definitely something that we would do ahead of time, whether certain tenants we think is going to fit into the new Causeway Point that we are looking at, because as we shared before, our idea is to transform Causeway Point into more a regional mall instead of currently it's more a mall that served just Woodlands catchment, we want to expand the trade mix that has ability to pull people from a wider catchment market, right? It's going to be a regional mall.

With that in mind, what are the kind of trades, what are we going to put in, not just the hardware, but the software as well. This is something that we are planning.

Again, our AEI is going to be done in stages, right? The mall will continue to trade while we look at doing it in phases over time.

Sorry, Richard, maybe I just add on, right? I think our perspective for the enhancement of Causeway Point is not just a response to potential risk.

There is a lot of opportunities from the infrastructural changes in the North, and with this AEI, we are seeking to tap into these opportunities. It's not just a reaction, right, to the RTS, but we do see tremendous opportunities.

Right. Thanks for the color.

Maybe just one final question on the acquisition. Notice that your slide 32 actually added that new pillar on acquisitions, I guess probably are turning a little bit more acquisitive.

Just wanted to get a sense in terms of your preference for maybe let's say if you're presented with a partial stake in a very strong dominant regional mall versus maybe a 100% stake in a neighborhood mall, because we do know that i12 Katong transacted at a pretty cheap valuation, I guess you'll probably be looking more at a strategic fit for the portfolio rather than just pricing alone.

Yes, definitely. I think for us, we look at it from a long-term perspective.

I'm not sure in terms of the buyer for i12, what's their plan for that asset, right? For us, it's a long-term game, it's a long-term hold.

In fact, we have sold some of the smaller assets before, assets that it did not fit into our portfolio. Again, we are very mindful about acquisition, disciplined approach, something that we feel that's going to value add to our portfolio.

Otherwise, it doesn't make sense, right? We are just buying for the sake of buying.

Again, sometimes headline numbers may not be showing the full picture, right? Why is it at that price, there must be some underlying reasons for that, right?

For us, it's about ability to contribute and add to our portfolio in a meaningful way. Accretion is also one we look at, maybe even if it's not immediate, it has to be one that we believe can give us that within a short period of time, right?

All these are consideration. Fundamentally, even the infrastructure is important for us, because you look at our strategy is always about having malls with strong catchment, strong ability to spend at the mall, because spend in a meaningful way, even though it's basic necessity, but we still need people with a propensity to spend for that category of products that we have.

Definitely yes, we will be very focused on anything that we consider. As I shared just now, when it was available, did we look at it?

Of course, it's our job, it's our duty to look at every opportunity that's available, but whether we proceed or not, that is another question.

Got it. Thanks for the color.

Thank you, Richard and team. Thank you.

Yeah. Thanks, Rayson.

Can I invite Derek from Morgan Stanley to unmute yourself to ask your question, please? Good morning, Derek.

Hi. Thanks.

Can you hear me?

Yes, we do.

All good.

Cool. Just two follow-ups.

Just on Metro, the lease at Causeway Point, when exactly it's expiring? If there's an early pre-term, does that jump-start the AEI commencement?

On cost of debt guidance, just to clarify, it's still 3.3% even though the quarters' cost of that is already 3.2%?

I will leave that financing question to Annie. If you ask me about the tenants in our mall, whether it will hamper our planning, the short answer is no, because like what I say, when we undertake AEI, we always do it in phases, right, and we can do different parts of the mall to prepare, and so on.

It doesn't really always have to be one whereby we have to wait for certain lease to expire, and so on, right? It's not conditional on Metro's lease per se.

When exactly do they expire?

I can't give you a definitive, because it's not public information. I'm not sure Metro will be very happy if we share that.

Really, the only thing that we can give comfort is our AEI is not determined by their expiry.

Okay. That's fair.

Derek, on your question, yes, although the quarter is 3.2%, you know that the 5 years 5-year SORA is pretty high. If we were to have new hedges, this will not be at the currently low SORA as well.

I think given that 1Q is already 3.5%, if you take constant at 3.2 for the rest of the quarter, it will be around 3.3%.

Got it. Thank you.

Thanks, Derek. Next up, we've got Tan Xian from GS.

Morning, Tan Xian.

Hey, morning. Can I ask about the distribution that's withheld?

If I recall, this is the first time other than COVID that you are withholding distribution, right? Is this also a function of gearing, and can you walk us through when we go into second half, what's the decision process in determining whether to pay this out?

I don't believe that this is the first time. I think we have done it before within the year, maybe the first half we retain and then we release in the second half.

It is definitely not the first time, at least during my time, right, if I can remember, right? Again, it depends on where we see potentially there could be just need for short-term basis, and then the decision to decide whether we want to distribute at the end of the day, again, there are many areas that we can look at in terms of how our performance continue to show for the next 6 months, whether there's really a need for us to keep this amount of money or whether this amount of money it's used during the 6 months itself.

There are many considerations that we will look at, but if we don't need the money and we can deliver what we wanted to do, yes, there's something that we will be able to distribute at the end of the year.

By needing money, are you also considering gearing?

Not really, because this 4.6 million is not going to move much needle in terms of our gearing. It's not from gearing perspective.

On a full-year basis going forward, I think 100% payout ratio is still a fair assumption?

Yes.

Got it. Thank you.

Thanks Tan Xian for your questions. Thanks everyone for your questions, as well as time today.

I don't think we have any more questions from the ground, thank you again for joining in FCT's first half 2026 results briefing. If there are any further questions, feel free to reach out to me, and have a great day ahead.

Thank you.

Thank you. Thanks.

Bye.

Catch up soon again.