SINGAPORE (Apr 16): The trustee-manager of Keppel Infrastructure Trust has declared a 1Q18 distribution per unit (DPU) of 0.93 cent, unchanged from a year ago.
Group revenue for the quarter was $160.3 million, up 3.2% from $155.3 million in 1Q17 mainly due to higher contributions from City Gas as a result of higher town gas tariff and higher revenue from Basslink, as it received positive Commercial Risk Sharing Mechanism payments in 1Q18.
The concessions, comprising Senoko WTE, Tuas WTE, SingSpring Desalination and Ulu Pandan NEWater plants, saw revenue grow marginally to $23.3 million from $23.2 million previously, with all four plants having fulfilled their contractual obligations during the period under review.
Basslink’s revenue grew 7.6% to A$21.3 million ($22.2 million) was 7.6% higher compared to A$19.8 million a year ago as it recorded positive commercial risk sharing mechanism (CRSM) in 1Q18.
Revenue from Keppel Merlimau Cogen (KMC) for 1Q18 was comparable to that of a year ago. The trustee-manager notes that the power plant fulfilled its contractual obligations during the period.
While CityNet contributed revenue of $0.9 million in 1Q17, there was no contribution this year as CityNet ceased to be the trustee-manager of Netlink Trust with effect from 13 April, 2017.
In all, earnings in 1Q18 grew 10.9% to $7.5 million from $6.8 million a year ago, mainly due to higher contributions from City Gas and lower professional fees incurred for the Basslink outage.
These were however partially offset by higher fair value loss of financial derivative instruments recognised in 1Q18.
As at end-Feb, cash and cash equivalents stood at $167.1 million, down from $202.1 million a year ago.
Looking ahead, the trustee-manager says it will evaluate asset enhancement opportunities in its portfolio, and will continue to identify and evaluate suitable acquisitions, including those from the sponsor, under its investment mandate to further grow the trust.
Referring to its ongoing plans to dispose of its subsidiary Basslink and an ongoing dispute with Hydro Tasmania regarding a facility fee payment related to the former’s interconnector asset, the trustee-manager adds that it has received an advance insurance payout of A$46 million, out of which approximately A$15.7 million was used to pay for part of the repair costs of the interconnector.
Keppel Infrastructure Trust’s trustee-manager however does not expect Basslink’s ongoing incident to have any material impact on its distribution to unitholders, since the trust does not reply on Basslink for its distributions.
Units in Keppel Infrastructure trust closed 0.9% lower at 54 cents on Monday.