KIT's earnings fall as payout at Keppel DC Reit rises

Keppel Infrastructure Trust's net profit plunges for the quarter due to cable fault

First-quarter earnings at Keppel Infrastructure Trust (KIT) plummeted owing to a cable fault, while at Keppel DC Reit, distribution per unit (DPU) came in higher.

Earnings at KIT for the three months to March 31 plunged 99.9 per cent year-on-year to $2,000.

Revenue rose 14.7 per cent to $131.2 million.

As KIT has changed its financial year end to December from March, it used the three months ended June 30, last year, as the basis to compare the first-quarter results for last year against the first-quarter results of this year.

Net profit was lower primarily because Basslink, one of the trust's assets, did not receive facility fees due to a cable fault, Keppel Infrastructure Fund Management said.

  • AT A GLANCE

  • Keppel Infrastructure Trust

  • DISTRIBUTION PER UNIT: 0.93 cent

  • NET PROFIT: $2,000

  • REVENUE: $131.2 million

  • Keppel DC Reit

  • DISTRIBUTION PER UNIT: 1.67 cents (+3.7%)

  • REVENUE: $24.8 million (-4.5%)

  • DISTRIBUTABLE INCOME: $14.7 million (+3.8%)

DPU amounted to 0.93 cent.

Net asset value per unit was 33.7 cents as at March 31, down from 35.3 cents as at Dec 31.

At Keppel DC Reit, DPU for the three months to March 31 rose 3.7 per cent to 1.67 cents, compared with the same period a year earlier.

Revenue dipped 4.5 per cent to $24.8 million, but total distributable income for the three months rose 3.8 per cent to $14.7 million.

Total distribution income came in higher than last year partly due to lower property operating expenses and higher net realised gains on derivatives.

Gross rental income dropped owing to a client downsizing its requirements in a data centre in Dublin, Ireland, Keppel DC Reit Management said.

Rental income was also lower because of the depreciation of the Aussie dollar and Malaysian ringgit against the Singdollar.

These were offset by contribution from a data centre in Australia and higher revenue from the appreciation of the euro against the Singdollar.

Keppel DC Reit Management said despite the uncertain economic prospects, the data centre industry fundamentals remain sound.

"Global trends such as multi-device ownership, proliferation of smart devices as well as the growth of cloud computing are expected to continue, increasing data creation and storage requirements," it said.

It noted that its portfolio occupancy rate remained healthy at 92.0 per cent, with a long weighted average lease expiry of 8.7 years as at March 31.

Singapore is expected to see an increase in data centre space this year and next year, which might exert pressure on rental rates, especially for leases expiring during that period, it noted.

Correction Note:  An earlier version of this article stated that revenue at KIT slid 14.7 per cent to $131.2 million. In fact, revenue rose 14.7 per cent. We are sorry for the error.

A version of this article appeared in the print edition of The Straits Times on April 14, 2016, with the headline 'KIT's earnings fall as payout at Keppel DC Reit rises'. Print Edition | Subscribe