Keppel DC (AJBU) Q2 2026 earnings summary

Executive summary

• Distributable income for 1H 2026 rose 18.5% year-over-year to $150.7 million, with DPU up 11.3% to 5.714 cents, driven by organic growth and acquisitions.

• Gross revenue increased 14.5% year-over-year to $242.0 million, supported by positive rental reversions, escalations, and the acquisition of Tokyo Data Centre 3.

• Portfolio occupancy stood at 92.5% as of 30 June 2026, with a WALE of 6.7 years and ~95% contracted power capacity.

• Secured contract renewals in Singapore and Australia at positive rental reversions, supporting resilient cash flows.

• Portfolio size reached approximately $6.3 billion, comprising 25 data centres across Asia-Pacific and Europe.

Financial highlights

• Net property income grew 15.1% year-over-year to $210.4 million.

• Distributable income and DPU increased by 18.5% and 11.3% year-over-year, respectively.

• DPU for 1H 2026 is 5.714 cents, with payment scheduled for 18 September 2026.

• Finance costs rose 25.2% year-over-year to $30.7 million due to acquisition-related borrowings.

• Aggregate leverage improved to 34% as of 30 June 2026, mainly due to loan repayments.

Outlook and guidance

• Data centre demand is projected to grow at a 25% CAGR to 256GW by 2030, with Asia Pacific expected to account for ~34% of demand.

• Cost of debt expected to remain between 2.6% and 2.8% for 2026.

• Portfolio reversion for the full year expected to be around 10%, with Q3 likely in the low teens due to Gore Hill renewal.

• The portfolio is positioned to pursue accretive opportunities in Tier 1 data centre markets across Asia and Europe.

• Macroeconomic uncertainty persists due to geopolitical tensions and inflation, with higher-for-longer interest rates potentially impacting financing costs.