NetLink NBN Trust posts 1.1% rise in H2 DPU to 2.71 cents
The company expects its business to “remain resilient” despite uncertainties from the Middle East conflict
[SINGAPORE] Fibre network operator NetLink NBN Trust posted a 1.1 per cent rise in distribution per unit (DPU) to 2.71 cents for the half-year ended Mar 31, as more government project completions drove topline growth.
H2 revenue was up 2.1 per cent to S$206.3 million, thanks to higher revenue from the ancillary project, co-location and central office segments, the company announced after trading hours on Thursday (May 14).
Ancillary project revenue was driven by more government project completions, while central office revenue was driven by the recovery of higher maintenance-related costs incurred in these offices.
The H2 revenue increase was partially offset by lower revenue from installations and other areas. This was due to lower orders for non-residential terminal point installations and fewer point-to-point installations, amid slower project activity.
Despite the topline growth, H2 profit after tax fell 15.1 per cent to S$39.8 million.
This came amid an 8.5 per cent increase in expenses for the half-year to S$174.6 million, partly due to maintenance requirements of the new Seletar Central Office, as well as higher staff costs.
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For the full year, NetLink’s DPU rose 1.1 per cent to 5.42 cents, on the back of a 1.6 per cent revenue increase to S$413.4 million.
The company noted that the Middle East conflict has introduced “renewed uncertainty, particularly from energy price volatility and supply-side pressures”.
It also expects higher operating costs and depreciation from the Seletar Central Office and ongoing investments into systems and fibre network infrastructure. This is set to erode profit after tax.
Nevertheless, these capital investments are “eligible for regulatory recovery in future periods”, NetLink noted.
The company expects its business to “remain resilient, supported by the essential nature of its services and its regulated business model”, and for FY2027 DPU to “remain stable” relative to the latest financial year.
NetLink ended Thursday flat at S$1.02.
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