Chung Keat Ng: Six results briefing. I am fully aware it is a busy and stormy day for the market, and we will just get right into the briefing shortly. Before that, I will just do a quick introduction around the room, all familiar faces. We have Anthea in the center, our CEO, Wah Keong, CFO, joined by Jay, our Head of Portfolio Management, and Justin, Head of Investment. I am CK, IR, and your moderator for today. With that, let us just get right on with the briefing. First, we will run, as usual, a quick pitch turn, and after that, we will be happy to take any questions that you may have. Just let me get the slides on the screen, and can start immediately with our overview from Anthea. Anthea, over to you.
Anthea Lee: Thank you, CK. Good morning, everyone. Thank you for joining us today for our full-year FY2026 results. So happy to present an overview of our performance for this year. Firstly, on distributions, our DPU for the H2 of FY2026 is 2.95 cents, with distributable income of SGD 112.5 million. This translates to an annualized DPU yield of 6.7% based on our closing unit price of 88 cents at 30 September 2026. The DPU of 2.95 cents includes a discretionary capital top-up of 0.07 cents. On the portfolio management front, we recorded a 96.2% occupancy rate, along with a 4.9-year WALE across our entire portfolio. L&I base rent reversions remained healthy, with a positive reversion of 10.4% on the incoming versus outgoing basis, or 24% on the average versus average basis for leases committed over the 12-month period in the financial year.
Anthea Lee: I will now hand over to Wah Keong, who will take you through the financial highlights.
Ng Wah Keong: Thank you, Anthea. I will now take you through the key drivers behind our FY2026 financial performance. Our revenue and adjusted NPI saw an uplift this year, primarily due to higher contributions from annual increments in the L&I segment, effect of the higher average exchange rate of Aussie dollar, euro against the Sing dollar in FY2026 relative to FY2025, maiden contributions from our acquisitions of interest in four L&I assets across Germany and the Netherlands, higher occupancy at Alexandra Technopark, maiden contributions from our acquisitions of a logistic property in the Netherlands, and full-year contributions from 2 Tuas South Link 1. However, these gains were partially offset by divestment of 357 Collins Street in September 2025, and the higher non-recoverable land taxes for Victoria and Queensland, Australia.
Ng Wah Keong: Finance costs rose mainly due to higher interest rates from refinancing of the existing borrowings and additional borrowings drawn to fund the acquisitions mentioned just now. This partially offset by the repayment of borrowings using proceeds from the divestment of 357 Collins Street in September 2025. Distributable income and DPU before capital distributions improved 10% and 9.4% respectively, while FY2026 capital distributions lowered to SGD 8 million, representing a 71.3% decline from FY2025. Next slide showing the H2 results. It is similarly underpinned by solid NPI growth driven by the higher annual increments from the L&I segment, higher AUD and EUR against the SGD, higher occupancies at ATP, together with the acquisitions completed in H2 of FY2026 mentioned in the previous slides. These tailwinds effectively cushions the effect of rising interest rates.
Ng Wah Keong: As a result, FLCT recorded a DPU of 2.88 cents before capital distributions for H2 of FY2026, representing an increase of 7.1% from the year prior. With 75% of management fee taken in units of FY2026, and inclusive of a capital distributions from divestment gain equivalent to SGD 0.07 per unit, our H2 FY2026 DPU totals of SGD 2.95, and I will share more about our underlying DPU performance in the next slides. Similar with previous financial years, we have these slides to cover our underlying semi-annual DPU performance and the capital distributions. In H2 of FY2026, capital distributions was down to SGD 0.07, which were added to H1 FY2026 is a total capital distribution of SGD 0.20 for the whole financial year.
Ng Wah Keong: This decision is consistent with our earlier guidance to pursue a balanced approach of preserving debt headroom for growth while supporting the near-term distribution stability. To add, H2 of FY2026 DPU before capital distributions also saw an increase of 3.1% and 7.1% on both a sequential and year-on-year basis respectively. This is supported by the strong same-store portfolio performance and acquisitions completed in H2 of FY2026, together with the 75% management fee taken in units during the H2 of FY2026. Looking ahead, at least 75% of management fee are expected to be taken in units for FY2027, and barring any unforeseen circumstances, capital distributions of divestment gains is targeted not to exceed 5% of total DPU for FY2027. We now move on to balance sheets.
Ng Wah Keong: The value of investment property edged out 5.8% to SGD 7.4 billion, largely attributable to the L&I acquisitions completed in H2 of FY2026, capital expenditure incurred, the forex gains from a stronger AUD that is partially offset by weaker EUR and Pound Sterling against the SGD as compared to the end of FY2025, and the net fair value downward adjustment of SGD 173.6 million. That brings our NAV per unit at SGD 1.07 per unit as of 30 September 2026. As of 30 September 2026, you can see our total gross borrowings was SGD 2.85 billion, and we have SGD 234 million in undrawn committed facilities available, which exceeds the debts obligations due in FY2027. In terms of our debt metrics, with our recent capital deployments of DPU equity L&I acquisitions, gearing increased to 39.2%.
Ng Wah Keong: This leaves us a debt headroom of approximately SGD 100 million before reaching the 40% gearing. We continue to adopt a disciplined and consistent capital management approach to navigate through the current volatile macroeconomic environment and interest rates landscape. Accordingly, on the right-hand side, you can see we reported another set of stable key credit metrics, a stable average cost of capital with trailing 12-month and 3-month cost of borrowing at 3.2% and 3.3% respectively, together with a well-distributed debt maturity profile with just SGD 204 million or 7% of the debts due for refinancing in FY2027. Timetable-wise, our DPU of 2.95 Singapore cents per unit for the second half of FY2026 will be paid on 23 December 2026. I will hand the next segment of presentations over to Richard.
Chung Keat Ng: Thanks, Wah Keong, and good morning, everyone. We will start with the valuations. As at 30 September 2026, our portfolio of 118 properties is valued at SGD 7.2 billion. Breaking it down by region, in Australia, which represents our largest market with 61 properties, we saw marginal growth with valuations up 0.3% to AUD 3 billion. This translates to an average cap rate of 5.9%. Our European portfolio now comprises 45 properties valued at EUR 1.8 billion and reflected a net initial yield of 4.9%. In the UK, our four properties were valued at GBP 156.9 million. Net initial yield was at 5.1%. Our 2 TSL property in Singapore was valued at SGD 143 million, representing a cap rate of 5.5%. Next slide covers our commercial portfolio valuation.
Chung Keat Ng: Our commercial portfolio, consisting of seven properties, is valued at SGD 1.6 billion as of September 2026, representing a decrease of 8.7% from carrying value, primarily due to upcoming lease expiries, existing vacancy, and yield expansion. Breaking this down by region, in Australia, our three properties saw a decline to AUD 594.5 million. Our Singapore property, Alexandra Technopark, saw an improved valuation at SGD 722 million compared to SGD 711 million a year ago, largely due to higher occupancy. The UK portfolio of three properties fleet freeze to GBP 199.4 million. Looking at the leasing summary, for the full year FY2026, leasing deals were completed, resulting in a reversion of 10.4% incoming versus outgoing and 24% average versus average. As at 30 September 2026, FLCT's portfolio passing rents are on average approximately 9% below market. Moving on to our occupancy review.
Chung Keat Ng: Our portfolio occupancy rate stands at 96.2% as at 30 September. Breaking it down by sector, for L&I, our overall occupancy rate remained highly resilient at 99.1%, with a minor decrease 2% to a tenant at our 2 TSL property in Singapore exercising its break option. On the commercial front, we have registered broadly improved occupancies across the portfolio. Subsequent to the quarter end, we have also signed a lease for the ex-Google space, which now brings the backfilling of ex-Google from 83% to 90%. We will skip on to the top 10 tenants. Our top 10 tenants currently account for 24.5% of portfolio GRI, with no single tenant contributing more than 4%. Eight of our top 10 tenants are from the L&I portfolio, and six of our top 10 tenants occupy multiple buildings across the portfolio with varying lease expiries.
Chung Keat Ng: I will now hand the time back to Anthea for the rest of the presentation.
Anthea Lee: Thank you, Greg. So subsequent to the financial year end, I would like to highlight our capital recycling efforts, specifically with the divestment of the Epson and Elder buildings at the Blythe Valley Business Park in the UK. So in October 2026, we concluded the sale of these two buildings for approximately GBP 3.3 million, which represents a 17.9% premium over the assets valuation of GBP 2.8 million as of 1 October 2026. Diving into our ESG highlights, I am pleased to update and thank you to the positive strides towards our ESG commitments. As at 30 September, the total solar capacity of FLCT portfolio stands at 28 megawatts, with over 90% of the portfolio by GFA green certified. I am pleased to also share that we reaffirm our position as a GRESB sector leader for the third year running.
Anthea Lee: In relation to our operating environment, we have observed that population growth and the continued adoption of e-commerce is driving sustained logistic demand and supported by nearshoring trends. Supply chain realignment is presenting opportunities for logistic landlords to attract customers across diverse geographies and industries. Global container freight rates have risen about 2.4 times since February 2026, though trade volumes have nonetheless held up, global container volumes up 5.1% year on year in the first seven months of 2026. I also want to take this opportunity to recap the proactive, deliberate steps FLCT has taken to strengthen our portfolio, stabilize distributions, and position FLCT for long-term growth. Firstly, on portfolio reconstitution, we continue to make progress in reweighting our portfolio towards L&I, working steadily towards our target of 85% L&I allocation.
Anthea Lee: Key moves include capital recycling activities with sale of the Juniper building in June, followed by the Epson and Elder buildings at Blythe Valley Business Park in October. We seek to actively recycle these proceeds into accretive L&I opportunities. Second, regarding DPU performance, despite volatile currency and interest rate pressures, our core operational metrics remain robust. While capital distributions from divestments were reduced to preserve debt headroom, our underlying core DPU in H2 of FY26 has grown year on year. As we enter the new financial year, the journey of active management continues. With a healthy portfolio occupancy level and a strong balance sheet, we believe FLCT is well-positioned to navigate a quality-driven market and capture opportunities.
