Axis REIT Earnings Dip, Recovery Expected with New Kedah Acquisition

KUALA LUMPUR, July 31 — Axis REIT reported 2QFY26 core net income of RM47 million, down 6% quarter-on-quarter, bringing first-half earnings to RM96.9 million. The results were within company expectations but slightly below consensus forecasts. The weaker performance was attributed to lower rental income following the expiry of a tenancy at Axis Shah Alam Distribution Centre 3, which reduced occupancy to 49%. Rental suspension at Wisma Kemajuan after a February fire also weighed on earnings, alongside higher property and administrative expenses.

Axis REIT Earnings

Despite the decline, Axis REIT expects earnings recovery in the second half of FY26, supported by new tenants at Shah Alam Distribution Centre 3, with occupancy projected to reach 71% by 3QFY26 and full occupancy by January 2027. Insurance claims for Wisma Kemajuan are also expected to restore rental income.

Portfolio occupancy remained stable at 93%, with Bukit Raja Distribution Centre improving significantly to 58% from 16% in 1QFY26. Axis REIT is actively expanding, announcing the RM113 million acquisition of a fully tenanted industrial complex in Kedah, expected to be yield accretive.

Analysts maintain a BUY call, revising the target price to RM2.18, citing stable outlook and attractive dividend yield of 5.3%.

Photo: NST

#businessnews