NET LOSS Other trust expenses for FY2024 decreased 14.3% from FY2023, mainly due to the absence of the accounting write-off of professional fees related to the multicurrency debt issuance programme recorded in FY2023. Interest income of US$3.3 million for FY2024 was US$2.7 million higher than FY2023 mainly due to short-term fixed deposits and higher interest rates earned on interest-bearing bank accounts. Finance expenses for FY2024 increased 4.5% from FY2023, mainly due to higher interest rates on borrowings and a one-off fee of US$2.3 million incurred in relation to the 2024 Net Proceeds Target under the Master Restructuring Agreement, partially offset by loan repayments in 2023 and 2024. Fair value loss on derivatives of US$16.6 million recognised in FY2024 was attributable to the fair valuation of interest rate swaps entered into to hedge against interest rate exposure. Fair value loss on investment properties for FY2024 was US$187.9 million as a result of a decline in valuations, adjusted for capital expenditure (Capex) and other costs related to the investment properties, while the loss on disposal of investment property arose from the divestment of Capitol, completed on 28 October 2024 (U.S. time) as a result of the transaction costs incurred. Tax income of US$0.1 million was due to the net impact from the recognition of deferred tax income on fair value loss of investment properties, partially offset by deferred tax expense from tax depreciation and withholding taxes in FY2024. Due to the effects of the above, MUST recorded a net loss of US$178.0 million, compared to the net loss of US$380.0 million for FY2023. INCOME AVAILABLE FOR DISTRIBUTION After adjusting for net fair value loss and other distribution adjustments, income available for distribution to Unitholders for FY2024 was US$38.3 million, 48.5% lower than FY2023. This was mainly due to lower net property income, higher finance expenses, partially offset by higher interest income. However, pursuant to the Recapitalisation Plan and the Master Restructuring Agreement, MUST has halted distributions to Unitholders till 31 December 2025, unless the Early Reinstatement Conditions are achieved earlier. PORTFOLIO AND NET ASSET VALUE (NAV) Excluding Capitol which was divested in October 2024, the portfolio value of MUST declined by 9.3% or US$116.6 million to US$1,137.2 million in FY2024. The decline in valuation was largely due to higher discount and terminal capitalisation rates, reflecting market and property-level risks. These risks include a decrease in leasing demand attributable to macroeconomic headwinds as well as downsizing on the back of lower utilisation of office space in certain submarkets, as well as higher vacancy or weak submarket fundamentals at the asset level. The decline in valuations was a key contributing factor which resulted in net assets attributable to Unitholders decreasing by 29.2% from US$608.6 million as at 1 January 2024 to US$430.6 million, which translated to an NAV per Unit of US$0.23 as at 31 December 2024. Key Financial Indicators As at 31 December 2024 As at 31 December 2023 Gross borrowings (US$ million) 745.0 925.7 Aggregate leverage1 (%) 60.8 58.3 Weighted average cost of debt² (%) 4.53 4.15 Weighted average debt maturity (years) 2.9 3.3 Interest coverage ratio3 (times) 1.7 2.4 Unencumbered properties as % of total portfolio4 (%) 100.0 100.0 CAPITAL MANAGEMENT AND RECAPITALISATION PLAN The Manager continues to maintain a proactive and prudent capital management approach, limiting Capex to essential spending while working on executing its Recapitalisation Plan. The proceeds from the divestment of Capitol, along with approximately US$21 million of cash from the balance sheet, enabled MUST to make an early repayment of the US$130.7 million of loans due in 2025 by November 2024. This repayment mitigates refinancing risk as there are currently no loans due until March 2026. The sale of Plaza in February 2025 provided further liquidity of approximately US$40 million for MUST to commence repayment of its 2026 loans totalling US$203.9 million. The REIT remains focused on fully repaying its 2026 loans by June 2025 through further asset divestments and cash. This will enable MUST to delever on a going-forward basis. 1 Based on gross borrowings as percentage of total assets. 2 Excluding the Sponsor-Lender loan exit premium. Including the Sponsor-Lender loan exit premium, the weighted average cost of debt would be 5.03% for FY2024 (FY2023: 4.55%). 3 Computed by dividing the trailing 12-month earnings before interest, tax, depreciation and amortisation (excluding effects of any fair value changes of derivatives and investment properties, and foreign exchange translation), by the trailing 12 months' interest expense, borrowing-related fees and distributions on hybrid securities as set out in the Code on Collective Investment Schemes (CIS Code) issued by MAS. 4 Based on appraised values. ANNUAL REPORT 2024 | 23
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