To The Moon

$KEPPEL DC REIT(AJBU.SI)$ The manager of Keppel DC REIT has reported a distribution per unit (DPU) of 10.214 cents for FY2022 ended December 2022. The financial year’s DPU, which is 3.7% higher than the DPU of 9.851 cents in FY2021, was computed based on the distributable income to unitholders after the deduction of capital expenditure (capex) reserves that has been set aside. Based on the REIT’s closing price of $1.77 per unit as at Dec 31 2022, its annualised distribution yield for FY2022 stands at 5.77%. In the 2HFY2022 period, distributable income and DPU increased by 7.3% and 4.8% y-o-y respectively, mainly due to contributions from acquisitions and investments, as well as proactive asset management. The REIT’s distributable income for the full FY2022 grew 7.7% y-o-y to $184.9 million, which was due mainly to contributions from the accretive acquisitions of Guangdong Data Centres (DC) 1, 2 and the building shell of Guangdong DC 3, London DC and Eindhoven DC. Positive income reversions, as well as contributions following the completion of asset enhancement initiatives (AEIs) at DC1 and the Dublin assets, as well as the completion of Intellicentre 3 East Data Centre in July 2021 also contributed to the REIT’s distributable income. This was partially offset by the net lower contributions from its Singapore colocation assets, largely arising from the higher facility expenses including electricity, staff and maintenance costs and provisions made for DXC by facility manager Keppel DC Singapore 1. In addition, the depreciation of foreign currencies against the Sing Dollar and the cessation of contribution following the divestment of iseek DC resulted in lower foreign sourced income. For FY2022, Keppel DC REIT reported gross revenue of $277.3 million, up by 2.3% y-o-y, while property expenses rose 8.1% y-o-y to $24.7 million — mainly from the Dublin assets following the AEI completion. In spite of this, the REIT posted a net property income (NPI) of $252.5 million, an increase of 1.8% y-o-y. However, its earnings, or profit attributable to unitholders, tumbled to $230.9 million, a 26.4% decrease from the previous financial year. Earnings per unit also decreased by 28.8% y-o-y to 13.44 cents on a basic and diluted basis. Net asset value (NAV) per unit for FY2022 stood 4.5% y-o-y higher at $1.40. As at Dec 31 2022, the REIT’s aggregate leverage stood 180 basis points (bps) higher at 36.4%. Cash and cash equivalents as at Dec 31 2022 fell 2.8% y-o-y to $190.4 million. The distributions for 2HFY2022 of 5.165 cents will be paid out on March 14.