Link Real Estate Investment Trust (823) H2 2025 earnings summary

Executive summary

• Delivered solid results with revenue up 4.8% to HK$14.2B, NPI up 5.5% to HK$10.6B, and DPU up 3.7% year-over-year, despite valuation pressures and macroeconomic headwinds in Hong Kong and mainland China.

• Distributable income rose 4.6% to HK$7.0B, aided by one-off tax resolutions and cost savings.

• Net asset value per unit declined 9.6% year-over-year to HK$63.3, mainly due to asset valuation decreases from cap rate expansion and FX depreciation.

• Maintained a strong financial position with net gearing at 21.5% and robust credit ratings from major agencies.

• Continued execution of a long-term diversification strategy, expanding into mainland China, Australia, Singapore, and the UK.

Financial highlights

• Revenue: HK$14.2B (+4.8% YoY); NPI: HK$10.6B (+5.5% YoY); Distributable amount: HK$7.0B (+4.6% YoY); DPU: HK$2.72 (+3.7% YoY).

• Portfolio value as of 31 March 2025 declined 4.7% to HK$220.4B, mainly from cap rate expansion and FX depreciation.

• Net gearing ratio: 21.5%; average all-in borrowing cost: 3.6% (down from 3.8%).

• Debt reduced to HK$53.5B from HK$60B year-over-year.

• Loss for the year attributable to unitholders: HK$8.86B, mainly due to fair value losses on investment properties.

Outlook and guidance

• Expect continued challenging conditions in Hong Kong and mainland China, with negative rental reversions likely to persist in the low to mid-single digits.

• Management is focused on operational efficiency, cost control, and diversification into new assets and geographies.

• Portfolio optimization, REIM business growth, and recycling non-core assets remain key drivers under the Link 3.0 strategy.

• No specific AUM target disclosed for the fund management business; infrastructure is fully set up and ready for growth.

• Priorities include sustaining resilience through operational excellence and cautious investment in growth drivers.