Keppel H2 profit from continuing operations rises 27.2% to S$645.4 million; proposes special dividend

[SINGAPORE] Keppel posted a net profit of S$645.4 million from its continuing operations for the second half of the year ended December 2025. This was up 27.2 per cent from S$507.5 million in the previous corresponding period, it said in a bourse filing on Thursday (Feb 5).

When accounting the net loss from discontinued operations, mainly from the remeasurement of M1’s telco business, Keppel’s total profit for H2 fell to S$410.8 million, down 35.4 per cent from S$636 million.

The company attributed the fall mainly to the accounting loss of S$222 million arising from the proposed sale of M1’s telco business – now classified as a disposal group – which is pending regulatory approval.

For the full year, net profit – excluding its non-core portfolio and discontinued operations – rose 29 per cent to S$1.02 billion, from S$787.8 million in FY2024.

Keppel attributed its FY2025 performance to higher profits across all of its three business segments: infrastructure, real estate and connectivity.

Of the three, infrastructure saw the largest share of earnings, bolstered by resilient results in the integrated power business and stronger growth from decarbonisation and sustainability solutions, despite softening spreads between electricity prices and the cost of natural gas.

When including the non-core portfolio and discontinued operations, the overall net profit for FY2025 was S$788.5 million, down 16.1 per cent from S$940.2 million a year earlier.

The results translated to H2 earnings per share for its continuing operations of S$0.355, up from S$0.282 in H2 FY2024.

Revenue from continuing operations for H2 was S$3.3 billion, up 11.8 per cent from a year earlier. For the full year, revenue rose 3.4 per cent to nearly S$6 billion.

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The asset manager has proposed a final dividend of S$0.47 per share for FY2025, comprising ordinary cash dividends of S$0.34 per share, as well as a special dividend of S$0.13 per share.

The special dividend comprises S$0.02 per share in cash and one Keppel Reit unit for every nine Keppel shares held. The price is equivalent to about S$0.11 per share, based on Keppel Reit’s closing price of S$0.98 on Feb 3, 2026.

The ordinary cash dividend comprises a proposed final cash dividend of S$0.19 and the interim cash dividend of S$0.15 per share paid in August 2025.

Keppel said that the special dividend was proposed given the strong progress in asset monetisation, and is based on 15 per cent of about S$1.6 billion in gross monetisation value from transactions that were completed in FY2025.

The company announced on Thursday that it aims to pay out special dividends based on 10 to 15 per cent of the gross value of asset monetisation transactions completed in the financial year, until the company’s monetisation programme is complete.

The company has raised a cumulative total of about S$14.5 billion since its asset monetisation programme began in October 2020.

The total cash dividend translates to a yield of 4.3 per cent, based on Keppel’s Feb 4 closing price. The group plans to pay the final ordinary cash dividend on May 8.

Divestment of non-core portfolio

The company said that it remains focused on optimising the speed of divestment and exit value of assets in its non-core portfolio for divestment, which had a carrying value of S$13.5 billion as at end-2025.

That portfolio comprises some legacy assets in the offshore and marine space, as well as other investments that are not aligned with Keppel’s focus as an asset-light global asset manager and operator.

Keppel’s chief executive officer Loh Chin Hua declined to give further guidance on the value of assets that could be divested this year, when asked during an earnings briefing on Thursday.

“I don’t think that we can give any projections, whether it’s a straight line, because some of these assets can be quite lumpy... There’re so many frying pans on the fire, so we do not know... when (they) will be ready,” he added.

While Keppel has a plan to sell these assets by 2030, the company is also looking for fair value and to optimise the exit price, even though some of these assets are quite a tough sell.

“We’re not doing a fire sale... We’re not in a distressed situation... So we’re a motivated seller, but it must be at the right price. So I think these are things that we have to work on to make sure that we get the right outcome for the shareholders,” he noted.

For the divestment of its legacy rigs, Loh said that the company is positive about the medium to longer-term outlook for rig prices, but is currently waiting for prices of some rigs to improve.

Keppel has been operating some of its jack-up rigs, as day rates have risen by between eight and 10 percentage points. However, the market for floaters remains soft, though Loh expects conditions to improve in the second half of the year.

The company is now looking to see if it can ink leasing agreements with other types of rigs without crew, fuel or supplies. These are known as bareboat charters.

“Once that happens, potentially it could actually be attractive to an investor because you’ve got cash flow. Now, in the meantime, if someone turns up and says, ‘Look, I’m interested in buying a rig’, and if the price is right, we will obviously be opportunistically looking at that as well,” noted Loh.

Asset management

Keppel’s funds under management grew 8 per cent to S$95 billion as at end-2025 from S$88 billion in the previous year.

This was driven by fundraising and investments, which added S$10.1 billion of new funds during the year, while asset management fees increased 4 per cent year on year to S$453 million.

Net profit from asset management went up by 15 per cent to S$189 million compared with the previous year.

This meant that recurring income grew 21 per cent to S$941 million in FY2025, compared with S$779 million in FY2024.

When asked if the company would provide forward guidance on earnings as a response to a proposal by the Singapore Exchange and the Monetary Authority of Singapore on forward-looking disclosures, Loh said Keppel is “not quite ready”.

However, he added that one of the main drivers of Keppel’s earnings is its funds under management.

“So if we continue to see growth, and we can turn those funds under management into fee income, that would obviously help our 2026 earnings. And we are seeing quite good traction on the fundraising side and also on the deployment side,” he added.

Shares of Keppel rose 6.1 per cent or S$0.67 on Thursday to close at S$11.62 on a cum dividend basis, after the news.