Keppel units post steady Q1 results

Two Keppel Corp units turned in steady first-quarter results.

Higher contributions from City Gas here and lower professional fees incurred for the Basslink outage in Australia boosted first-quarter numbers at Keppel Infrastructure Trust (KIT).

Distribution per unit (DPU) came in at 0.93 cent for the three months to March 31, unchanged from the same period a year ago.

Profit attributable to unit holders rose 10.9 per cent to $7.5 million, it reported yesterday, due mainly to the performance of City Gas, a producer and retailer of piped town gas, and those lower fees over the 2015 problems at Basslink.

Basslink, an Australian subsidiary, owns and operates the electricity interconnector between the grids of Victoria and Tasmania.

Revenue climbed 3 per cent from the previous year to $160.3 million.

  • AT A GLANCE

  • KIT

    Revenue: $160.3 million (+3.2%)

    Net profit: $7.5 million (+10.9%)

    Distribution per unit: 0.93 cent (unchanged)

  • KEPPEL DC REIT

    Gross revenue: $38 million (+17.9%)

    Net property income: $34.1 million (+18.2%)

    Distribution per unit: 1.8 cents (-4.8%)

KIT, which is in a dispute with the Tasmanian authorities over a cable failure in 2015, reiterated that it would follow the dispute resolution steps set out in the Basslink Operations Agreement to resolve the issue.

"However, if the dispute cannot be resolved, it would be referred to arbitration, and Basslink intends to vigorously defend the matters raised in the notice."

Basslink said on March 28 that a third-party contractor damaged a piece of equipment during maintenance, resulting in service outage.

These events are not expected to have any material impact on KIT's distributions for this financial year as it does not rely on Basslink's cash flow for its distributions, it said.

Meanwhile, Keppel DC Reit posted a first-quarter DPU of 1.8 cents, down 4.8 per cent from 1.89 cents in the same period a year ago.

Excluding the one-off capital distribution of 0.15 cent per unit in the first quarter a year earlier in relation to Keppel DC Singapore 3, the adjusted DPU for the first quarter last year would be 1.74 cents.

DPU in the three months to March 31 would therefore be 3.4 per cent higher than the adjusted DPU in 2017, owing mainly to higher contributions from Keppel DC Dublin 2 and higher variable income from Keppel DC Singapore 1.

Gross revenue rose 17.9 per cent to $38 million while net income rose 18.2 per cent to $34.1 million.

Separately, the Reit said Ms Christina Tan, CEO of Keppel Capital, will replace Mr Chan Hon Chew as chairman.

A version of this article appeared in the print edition of The Straits Times on April 17, 2018, with the headline 'Keppel units post steady Q1 results'. Print Edition | Subscribe