Keppel Infrastructure Trust posts 27.7% rise in Q1 distributable income of $65 million

SINGAPORE - Keppel Infrastructure Trust (KIT) on April 22 reported a jump in distributable income of 27.7 per cent to $65 million for the first quarter of 2025, from $50.9 million in the year-ago period.

This is in the light of contributions from new acquisitions and capital recycling exercises, notably the proposed investment in subsea cable solutions provider Global Marine Group (GMG) for about US$90.6 million (S$118 million). It is set to establish KIT’s presence in digital infrastructure, based on the company’s first-quarter business update.

KIT is set to acquire an approximate 46.7 per cent stake in GMG from its trustee-manager, Keppel Infrastructure Fund. It previously held a 100 per cent interest in GMG since acquiring it in early March. The pro forma assets under management, including the share of the enterprise value of GMG, are $9 billion, assuming the completion of the acquisition.

Post-acquisition, the remaining 53.3 per cent interest will be held by KIF and its co-investor.

However, the trust manager did note that first-quarter distributable income will decrease by 31.9 per cent on the year to $45.4 million after adjusting for one-off costs.

Distributable income from the trust’s distribution and storage segment increased to $23.6 million in the first quarter, up 49.8 per cent from $15.8 million in the first quarter of 2024. Contribution from Ixom, KIT’s infrastructure business in Australia and New Zealand, however, was down 2.2 per cent to $14.7 million on higher capex and interest expenses.

Additionally, the gain from the divestment of the 50 per cent stake in Philippine Coastal – completed on March 20 – was $21.6 million.

That said, a loss of $678,000 was noted for the distribution income under the Philippine Coastal segment due to higher debt repayment of $5.2 million. It was partly offset by better performance, mainly due to higher contract prices and lower capex.

The trust manager said that upon the completed sale of Philippine Coastal, proceeds were redeployed to fund yield-accretive acquisitions.

Corporate expenses – comprising trust expenses and distributions payable to perpetual securities holders, management fees, as well as financing costs – were reduced by 27.7 per cent to $25.7 million.

As at March 31, KIT’s net gearing stood at 40.8 per cent, with interest coverage ratio at 6.8 times. About 75 per cent of its debt was hedged or pegged to fixed rates.

Units of KIT fell 2.4 per cent to 40.5 cents as at 9.18am on April 22. THE BUSINESS TIMES