Keppel DC (AJBU) Q4 2025 earnings summary

Executive summary

• Achieved record distribution per unit (DPU) of 10.381 cents for FY2025, up 9.8% year-on-year, the highest since listing in 2014, with distributable income rising 55.2% to $268.1 million, driven by accretive acquisitions and strong portfolio performance.

• Assets under management increased to approximately $6.3 billion, up 26% year-on-year, supported by acquisitions in Japan and Singapore.

• Portfolio optimization included $1.1 billion in acquisitions and $0.2 billion in divestments, with a focus on hyperscale data centres.

• Included in the Straits Times Index from June 2025 and received awards in Singapore, Ireland, and for governance, investor relations, and sustainability.

Financial highlights

• Gross revenue grew 42.2% year-on-year to $441.4 million, and net property income increased 47.2% to $383.3 million.

• Portfolio valuation increased 25.6% year-on-year to $6.1 billion, mainly from acquisitions and valuation uplift in Singapore.

• Portfolio occupancy remained high at 95.8% with a weighted average lease expiry of 6.7 years.

• Portfolio reversion for FY2025 was about 45%, with 2% in 4Q25.

• Rental income from hyperscalers rose to 69.3% as of December 31, 2025, up from 61.1% a year ago.

Outlook and guidance

• Global growth expected to ease to 2.6% in 2026; data centre demand projected to grow at 19.4% CAGR from 2025–2029, outpacing supply.

• Demand for data centres is expected to remain robust, powered by cloud adoption and AI workloads, despite a slowing macroeconomic environment and cautious monetary policy.

• Average cost of debt expected to trend down to 2.7% in 2026.

• 6.4% of contracts by rental income due for renewal in 2026, with positive rent reversions expected.

• Focus remains on high-quality, accretive acquisitions in established data centre hubs.