Keppel Infrastructure Trust (A7RU) H1 2026 earnings summary

Executive summary

• Portfolio valued at S$9.4 billion as of June 30, 2026, with a 13%–13.2% total return year-to-date and 136% over the past decade, driven by resilient earnings, disciplined capital management, and strategic growth initiatives.

• Distributable income before divestment gains rose 1.2% year-over-year to S$101.1 million in 1H 2026, despite fuel cost under-recovery at City Energy.

• 1H 2026 distribution per unit (DPU) declared at 1.99 cents, maintaining stable payouts and scheduled for August 2026.

• Portfolio demonstrated strong cash flow resilience amid Middle East conflict, with limited direct exposure and defensive assets supported by long-term contracts.

• Approximately 80% of divestment proceeds redeployed into accretive acquisitions, notably increasing KMC stake to 90% and acquiring 46.7% of GMG.

Financial highlights

• Total asset funds from operations (FFO) up 14% year-over-year to S$200.5 million, mainly from Energy Transition, Distribution & Storage, and new contributions from GMG.

• EBITDA increased 7.8% to S$255.1 million; FFO up 24.4% to S$154.1 million year-over-year.

• Trust-level distributable income at S$101.1 million, up 1.2% year-over-year excluding prior year divestment gain.

• Consolidated debt rose to S$3.28 billion; net gearing increased to 44.2% due to acquisitions and reduced cash post-distribution.

• Weighted average cost of debt stable at 4.4%–4.5%; 77% of debt and 79% of cash flow distributions hedged.

Outlook and guidance

• Focus remains on disciplined investment, capital recycling, and operational excellence to drive sustainable DPU growth and total returns.

• Management expects higher KMC contributions in 2H 2026 after increasing its stake to 90%.

• BKR2 feed-in tariff to step down in October 2026, with an estimated S$4 million annual DI impact, partially offset by lower loan amortization.

• Planned growth capex of S$133 million for FY 2026, targeting plant life extension, capacity expansion, and fleet growth.

• Digital Infrastructure segment maintains strong contracted revenue visibility through 2028–2030.