NetLink pays out record full-year distribution as H2 earnings rise 6.9% to S$54.7 million 

FIBRE network infrastructure provider NetLink NBN Trust on Thursday (May 18) reported earnings of S$54.7 million for the second half of its fiscal year ended March, up 6.9 per cent from S$51.2 million in the corresponding year-ago period.

With this, NetLink’s full-year earnings were up 19.7 per cent to S$109.3 million. 

With the stronger bottomline showing, the company sweetened its distribution payout to shareholders, doling out a record-high total full-year distribution of S$0.0524 per unit for FY2023. 

For H2, the trust’s distribution stood at S$0.0262 per unit, up from S$0.0257 per unit in the year-ago period. The distribution will be paid out to shareholders on Jun 13. 

For the period under review, revenue rose 7.5 per cent to S$203.9 million from S$189.7 million. This was due chiefly to higher revenue from ancillary projects, non-building address points (NBAP) and segment connections, residential connections, and colocation orders. 

This was, however, partially offset by lower ducts and manholes revenue due to decreased cable length chargeable.

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Segmentally for H2, NetLink’s ancillary project revenue more than doubled to S$13.9 million from S$5.5 million due to more projects completed. NBAP and segment connections revenue was up 30.3 per cent to S$9.2 million on the back of higher demand for point-to-point connections to support mobile network rollout and other projects requiring high resiliency. 

Revenue contributions from residential connections were up 1.5 per cent to S$122.6 million from a higher number of connections. The company noted that there were about 1.49 million connections as at end-March this year, versus 1.46 million as at the same time last year. 

Expenses for H2 rose 7.7 per cent to S$152 million from S$141.2 million due mainly to higher ancillary project costs and finance costs. The increase was partially offset by a decrease of S$1.5 million in staff costs as a result of higher capitalisation of labour costs for IT and fibre projects. 

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Looking ahead, NetLink said the global growth outlook remains uncertain. The company will continue to keep a watchful eye on the evolving macro environment and take necessary mitigating measures. 

NetLink said its business model is “resilient and is well supported by predictable revenue streams”. 

“The group’s balance sheet and liquidity remain strong, underpinned by stable cashflows and access to financial resources to support future capital expenditure. Notwithstanding the increased funding and operation costs, the group expects to maintain its distributions to unitholders,” it added. 

NetLink closed flat at S$0.885 on Thursday prior to the results announcement.