Keppel DC (AJBU) H2 2024 earnings summary

Executive summary

• 2H 2024 DPU rose 13.2% year-over-year to 4.902 cents; full-year DPU up 0.7% to 9.451 cents.

• Gross revenue for FY 2024 grew 10.3% to S$310.3m, driven by acquisitions and higher variable rent.

• Profit after tax surged to $314.0m, mainly due to net fair value gains and divestment gains.

• Major acquisitions included Tokyo DC 1 and Keppel DC Singapore 7 & 8; Basis Bay and Intellicentre Campus divested.

• Portfolio value increased 34.1% to S$4,831.5m, with 25 assets across 10 countries.

Financial highlights

• Distributable income for FY 2024 was $172.7m, up 3.0% year-over-year; 2H 2024 distributable income up 8.8%.

• Adjusted DPU for 2H 2024 was 4.955 cents (+14.4% year-over-year); full-year adjusted DPU up 1.3%.

• Loss allowances for Guangdong DCs impacted 2H 2024 DPU by 0.254 cents.

• Higher finance income from Australia Data Centre Note and deposits; finance costs decreased marginally.

• Distribution yield was 4.34% based on 31 December 2024 closing price.

Outlook and guidance

• Data centre demand in Asia Pacific grew 18.3% year-over-year in 2024; global demand driven by cloud and AI.

• Hyperscale and AI-driven demand expected to accelerate; supply constraints in key markets.

• Operators transitioning to renewable energy; power purchase agreements gaining traction.

• Manager will focus on proactive management, sustainability, and portfolio growth in key hubs.

• Risks include inflation, commodity price volatility, geopolitical tensions, and protectionist policies.