Keppel Corp's Q1 profit and revenue up slightly

KEPPEL Corporation on Thursday posted a revenue of S$1.89 billion for its first quarter ended March 31, a 1.72 per cent increase from its S$1.86 billion in revenue the previous year.

This was "mainly due to higher contributions from the urban development and asset management segments, offset by lower revenues from energy and environment", said Keppel in its business update.

As a result, net profit for Q1 FY21 was "slightly higher" year-on-year (yoy) than its net profit of S$160 million in Q1 FY20.

Loh Chin Hua, chief executive of Keppel Corp, said in a call following the group's business update that "while the macro environment remains challenging, the group has made creditable progress", adding that the group's higher net profit in Q1 FY21 came mainly from operating income, compared with Q1 FY20, where the group had a "sizeable contribution" from the reclassification of Keppel Infrastructure Trust.

For the quarter, Keppel Offshore & Marine (O&M) returned to positive earnings before interest, taxes, depreciation and amortisation (Ebitda) due to improving margins and productivity quarter-on-quarter. However, it recorded a net loss.

Its revenue in Q1 FY21 was S$412 million, lower than S$569 million in the previous year, mainly due to the termination of its Awilco rigs.

Mr Loh noted that the group is "making good progress in the organic transformation of Keppel O&M", adding that it is "carefully managing costs while actively seizing new opportunities", and is engaging in discussions with potential buyers of its rig assets.

Keppel Infrastructure's revenue for the quarter fell similarly from S$651 million in Q1 FY20 to S$635 million in Q1 FY21. Ebitda stood at S$31 million, down from S$43 million the previous year.

On Wednesday, Keppel Infrastructure announced that its wholly-owned subsidiary Keppel Volt and Wanbang Digital Energy, also known as StarCharge, have inked a non-binding memorandum of understanding to explore investing in, developing, owning and operating electric vehicle (EV) infrastructure in Singapore through a joint venture to be established. They will also pursue other EV-related opportunities in Singapore and selected markets in the Asia-Pacific region.

Cindy Lim, chief executive of Keppel Infrastructure, noted that the group sees EV charging infrastructure "as a pathway towards decarbonisation", adding that it will "target to seize a meaningful market share", in line with the government's goal of having 60,000 EV charging points at public carparks and private premises by 2030.

Meanwhile, as for Keppel's bifrost cable system, the group noted that this "unleashes synergy across business units including Keppel data centres and M1", as well as provide opportunities to secure third party funding through Keppel Capital.

Keppel Capital had performed better yoy in Q1 FY21, which was mainly attributed to "stronger operating results as well as gains from mark to market of investments".

For the quarter, asset management fees grew to S$42 million, compared with S$35 million in the previous year.

Meanwhile, M1's Q1 FY21 performance was lower yoy largely due to lower roaming and prepaid revenues, said Keppel. Ebitda stood at S$55 million for the quarter, down from S$73 million in Q1 FY20.

Keppel shares closed S$0.02 or 0.38 per cent higher at S$5.33 on Thursday, prior to the business update.