Keppel trusts' returns stable on lower costs

Keppel DC Reit's Dublin data centre. The Reit has a portfolio of data centres in Asia-Pacific and Europe.
Keppel DC Reit's Dublin data centre. The Reit has a portfolio of data centres in Asia-Pacific and Europe. PHOTO: KEPPEL CORPORATION

Keppel DC Reit's distribution per unit is up 3.1%, while KIT's DPU is unchanged in second quarter

Keppel DC Real Estate Investment Trust (Reit) and Keppel Infrastructure Trust (KIT) reported their second-quarter results yesterday, with both tabling stable returns to unitholders as earnings were underpinned by lower expenses.

Keppel DC Reit's revenue for the three months to June 30 was down 4.5 per cent year on year to $24.87 million, while turnover for the first half dropped 4.5 per cent to $49.64 million.

But a 32.7 per cent drop in property expenses to just $2.76 million in the second quarter helped stabilise the net property income at $22.11 million, up 0.8 per cent.

The reduced expenses came largely from lower repairs and maintenance costs, as well as the depreciation of Australian dollar against the Singdollar, Keppel DC Reit said yesterday.

As a result, distributable income was up 3.3 per cent to $14.75 million in the second quarter, with a 3.1 per cent increase in distribution per unit to 1.67 cents. DPU was 3.34 cents for the half year, up 3.4 per cent.

  • AT A GLANCE

    Keppel DC Reit

    REVENUE: $24.87 million (-4.5%)

    DISTRIBUTION PER UNIT: 1.67 cents (+3.1%)

    NET ASSET VALUE PER UNIT: 91.8 cents


    Keppel Infrastructure Trust

    REVENUE: $137.35 million (-10.2%)

    DISTRIBUTION PER UNIT: 0.93 cents (unchanged)

    NET ASSET VALUE PER UNIT: 32.4 cents

These figures were ahead of Keppel DC Reit's forecasts made for its public offering in late 2014, which put its DPU at 1.66 cents for the second quarter and 3.31 cents for the half year.

The Reit has data centres in Asia-Pacific and Europe, with a total occupancy rate of 92.3 per cent. Digital technologies and data creation will support demand amid economic headwinds, it said.

Earnings per unit was 2.08 cents for the second quarter, up from 1.74 cents a year ago. Net asset value per unit was 91.8 cents as at June 30, down from 92.1 cents as at Dec 31.

Keppel DC Reit units closed up one cent or 0.86 per cent at $1.17, ahead of the release of the results.

Meanwhile, Keppel Infrastructure Trust reported a DPU of 0.93 cents for the second quarter, unchanged from the last quarter and the same three months last year.

This was despite a 10.2 per cent drop in revenue to $137.35 million in the three months to June 30.

Half-year turnover was $268.6 million, up 0.5 per cent but with second-quarter expenses down 9.4 per cent to $144 million, profit attributable to unitholders shot up from $4.13 million a year ago to $16.57 million.

A beefy insurance compensation for the Basslink cable fault also added to the earnings.

Earnings per unit was 0.43 cents for the second quarter, up from 0.11 cents a year ago, while net asset value for the group was 32.4 cents a unit, down from 35.3 cents on Dec 31.

KIT units closed up half a cent or 0.99 per cent to 51 cents ahead of the results' announcement.

A version of this article appeared in the print edition of The Straits Times on July 19, 2016, with the headline 'Keppel trusts' returns stable on lower costs'. Print Edition | Subscribe