Updc REIT net income drops by 50% to N1.8bn

….. boosts loss position in 2016

The operational challenges of the Real Estate Investment Trust (REIT) in the country, may have impacted negatively on UPDC REIT, for the 2016 financial year, as its performance reflects sustained loss position.

Experts at the first Nigerian Stock Exchange (NSE), REIT conference, which held recently at the Exchange, were of the consensus that the Nigerian operating environment for REIT has remained challenging, with huge cost implication.

UPDC REIT audited result for the financial year ended 31 December, 2016, recently released by the NSE, showed that profit and loss lines sustained a depressive trend, as earnings dropped by 50 per cent, just as operating expenses soared.

The company’s income from investments dropped to N1.104, 033 from N1, 605,526 recorded in 2015 financial year, interest income dropped to 750,277 from N1.3 billion posted in the prior year, while Net loss on financial assets closed higher at N98.166 million from N90, 065 million posted in 2015 financial year.

The UPDC REIT 2016 result further showed that Net gain on financial assets at fair value, through profit or loss, closed the period at N292, 580. Other income was recorded in 2016, against N12,244 was posted in 2015 financial year

Fair value (loss) on investment property, however, reduced to N204,637, from N385, 200 recorded in 2015 financial year. Operating expenses closed higher at N331, 943 from N282,634 in 2015, reflecting increase by about 20 per cent rise in opex.

The company’s earnings was, however, lifted by tax holiday, hence no tax was paid in 2016, against N82. 575 million tax paid in 2015.

Profit before tax, however dropped to N1, 512,139 in 2016, from N3, 072,101, reflecting about 50 per cent decline, while Profit After Tax also depressed to N1,512,139 , against N2,989,526 in 2015.

UPDC REIT Net income posed in 2016 financial year, stood at N1, 844,082, from N3, 354,735 in 2015, reflecting about 50 per cent decline during the year.