Asian Pay TV Trust 3Q Results- Stable 10% Dividend Yield and Paring Down Debts

Asian Pay TV Trust (APTT) has released their 3Q results, the first full results after their refinancing of debt. Of which significant new information can be found. The summary of the results is as follows:

• Overall Revenue Still in Decline as no of TV subscribers in Traditional TV continues to fall
• 90% of Onshore Debt has been hedged at 1.54% Taiwan TAIBOR, indicating overall debt interest rate to 3.6-3.7%
• Management guided the additional interest cost of S$2 million to S$3 million for this year with interest expense to decline by $2 million next year
• 2025 Dividend Still Set for 1.05 SG cents

Cashflow and Dividend

Declining EBITDA margins leads to downstream less cash generated. Over the next 7 years, it is likely APTT will generate $100-$120 million annually.

With annual CAPEX needs of $28 million, taxation of $10 million, interest expense of $40 million (and declining）, there is sufficient headroom to maintain the 1.05 SG cents dividend which requires $19 million over the next 7 years.

Another Important thing is paying down the Debt.

Over the past 5 years, APTT has started to shrink its debt. However, one would notice "Net debt to EBITDA" ratio has increased. Thish indicates APTT EBITDA (Cashflow) is shrinking faster than it is shrinking its debt.

This is a ratio to keep watch; a ratio that is 10 or above indicates the cashflow has fallen too fast relative to the shrinking of debt. APTT's Taiwanese bankers would be worried. That said, APTT's current 8.1 ratio is still good and it has an interest coverage ratio of 3.8 times. 

For REITs, ICR of below 2 times is where it is dangerous; however, APTT is at 3.8 times which shows it is relatively safe.

As an investor, I am looking at how fast APTT pays down before the next tranche of refinancing in 2032. If APTT is able to reduce the debt from 1,163 million to 800 million by 2032; I believe dividend will maintain.

Baseline Expectations and Target Price

Much of APTT's future hinges on how well the Trust Manager deleverages while it encounters slowing cashflow and overall revenue. If executed properly, the baseline is that APTT will provide 1.05 SG cents of dividend annually to shareholders.

This is my baseline scenario. In addition, I believe for its business model, a 8% dividend demanded is fair. Hence my target price for APTT is 13.1 Sg cents (25% upside for owning APTT).

Nov 2025 Portfolio Update: Encashing LendLease REIT into a 10% Dividend Yielder Trust

With Lendlease REIT shareholder unfriendly action to dilute existing unitholders at approx. 13.5% discount to finance a purchase, I have pared down my stake

Thought of Lendlease REIT  

While Lendlease REIT is pivoting to be a full Singapore REIT, the way it has resolved to do it is to purchase more shopping malls from the parent. Looking back Fraser Centrepoint Trust has done the same thing, but its share placements have always been only done at 1 times book value; and unitholders were given the opportunity to partake in it. 

Lendlease REIT in its anxious state to grow big has severely diluted existing unitholders and not offer a chance to existing unitholders to join the discount. Further, its purchase was fully financed by share placement. What this means is leverage will lower; but existing unitholders are diluted. The placement price was not good too and the banks supporting it wanted to earn the easy money out by not placing it at $0.62（ex dividend); this could have been done, and it is likely Lendlease REIT would have achieved its fund-raising objective. Both the REIT manager and Singapore banks were doing a great disservice to Lendlease Minority Unitholders which shows how terrible Singapore stock market is and something "MAS" current poster boy Chee Hong Tat should aim for- which is to stop retail investors from being easily diluted with legislative measures put in place to punish controlling shareholders.

As of now, Lendlease REIT only owns 70% of PLQ with a definite future that 30% more will be purchased. I do not know if it will be another share placement or leverage up to 42%; but as unitholders, it seems the REIT manager does not care about the minority at all. As a result, despite 90% of its portfolio now in Singapore shopping mall, there is a discount ascribed to the company where it now trades at 0.9 times book value. There is about 5-6% discount due to potential shareholder unfriendly action. 

With 0.9 times book value and 5.7% dividend yield, Lendlease REIT is ALMOST FULLY VALUED. Unless the REIT manager changes its action and state it in words via SGX announcement documents or AGM minutes, it is unlikely it will go to 0.96 book value (which is the true fair value like Fraser Centrepoint Trust, office properties are now valued at 0.6 times book value); hence I have decided to pare down my stake to buy other shares with higher upside. They are:

1. Asian Pay TV Trust-10% Dividend Yielder who should be chugging along at this rate nicely for 5 years to come
2. NTT DC REIT- a 7% dividend yielder
3. Nanofilm- A component precision manufacturing company with exposure to China and;
4. United Hampshire US REIT- Sustainable 8% Dividend Yielder.

Dividend, Dividend, Dividend

The reshuffling of fund, moving from fair value to undervalued dividend gems, will enhance my dividend inflow.

My US REITs are a great value bargain starting to prove their worth with improvement in cash flow.