AL-SALAM REIT ANNUAL REPORT 2017

36 AL-SALĀM REIT ANNUAL REPORT 2017 PROFIT FOR THE YEAR Al-Salām REIT closed the year with a profit of RM40.6 million (FY2016: RM46.7 million) comprising realised profit of RM35.5 million (FY2016: RM36.0 million) and unrealised profit of RM5.1 million (FY2016:RM10.7 million). Lower realised profit was registered as compared to those of the previous year mainly due to higher operating expenses of the properties. The unrealised profit of RM5.1 million comprised fair value gain after accounting for capex incurred. Net fair value gain for the year mainly attributable to Menara KOMTAR, MCHM and certain QSR properties. DISTRIBUTION PER UNIT (DPU) Total income available for distribution for FY2017 was RM35.5 million (FY2016: RM36.0 million). The Fund had distributed an interim income distribution of 2.85 sen per unit amounting approximately RM16.5 million on 13 October 2017. On 29 January 2018, theManager, declared a final income distribution of 3.15 sen per unit totaling RM18.3million. The said distribution was paid on 28 February 2018 and has not been included as a liability in the financial statements as of 31 December 2017. Total income distribution for FY2017 is 6.00 sen per unit (FY2016: 6.00 sen) totaling RM34.8 million, which represents 97.9% of the income available for distribution. STATEMENT OF FINANCIAL POSITION Al-Salām REIT’s total asset value increased to RM988.8 million as at 31 December 2017 compared to RM978.2 million in the previous year. The increase of RM10.6 million was derived from gain in fair value of investment properties and capex incurred of RM5.4 million, increase in other assets of RM7.6 million and decrease in cash and bank balances (including fixed deposit) of RM2.4 million. Performance Benchmark i. Distribution Yield (%) ii. Total Returns (%) iii. NAV per unit (after income distribution) (RM) FY2017 6.0% -1% 1.0311 Commentary Distribution yield has increased marginally from 5.6% to 6.0% due to lower closing price of RM1.00 compared to RM1.07 in FY2016. Total return for the financial year was -1% (FY2016: 20.6%) contributed by capital loss of 6.5% (FY2015: capital gain of 15%) plus distribution yield of 6.0% (FY2016: 5.6%). NAV per unit increased by 2% mainly arising from gain on fair value of properties. FY2016 5.6% 20.6% 1.0211 PERFORMANCE BENCHMARK Notes: i. Based on DPU of 6.00 sen (FY2016: 6.00 sen) divided by its closing price as at 31 December 2017 of RM1.00 (FY2016: RM1.07). ii. Total return represents the change in unit price during the year plus distribution yield for the year. iii. Net asset value per unit is determined by deducting the value of all Al-Salām REIT’s liabilities from the total asset value, divided by total issued units.