|Bid||6.73 x 0|
|Ask||6.74 x 0|
|Day's range||6.71 - 6.82|
|52-week range||5.67 - 8.35|
|Beta (3Y monthly)||1.48|
|PE ratio (TTM)||13.04|
|Earnings date||17 Apr 2019 - 22 Apr 2019|
|Forward dividend & yield||0.25 (4.02%)|
|1y target est||8.23|
Singapore conglomerate Keppel Corp is planning to 1,800 staff this year at its offshore and marine business, the first time the company is hiring for the division after cutting thousands of jobs since 2015. The slump in oil prices in 2014 and a global oversupply of drilling rigs had hit orders at the company's O&M division, but demand is slowly returning. "With the expected increase in work flow as well as preparing for the upturn we would be looking to add to our (O&M) workforce this year," Keppel CEO Loh Chin Hua said at the company's results briefing.
SINGAPORE (Apr 18): Keppel Corporation saw its earnings fall 39.9% to $202.9 million for the 1Q19 ended March, from $337.5 million a year ago.The decline was mainly attributable to the absence of a $289 million gain in 1Q18 arising from the en bloc sale of Keppel Cove in Zhongshan, China.In 1Q19, the group recorded gains of $174 million from the divestment of a 70% interest in Dong Nai Waterfront City, Vietnam and the re-measurement of previously held interests in M1 at acquisition dateConsequently, other operating income was halved to $145.6 million in 1Q19, from $300.0 million a year ago.1Q19 revenue grew 4.1% to $1.53 billion, from $1.47 billion a year ago.The increase was underpinned by higher revenues from power and gas sales, infrastructure projects in Singapore and Hong Kong, asset management and the consolidation of M1, offset by lower contributions from property trading in Singapore.Keppel Corp’s Offshore & Marine (O&M) Division registered a net profit of $6 million for 1Q19, compared to a net loss of $23 million a year ago.This was due mainly to a share of results from associated companies which turned profitable year on year, as well as lower taxes.The Property Division – the largest contributor to the group’s 1Q19 net profit – recorded a net profit of $132 million, 65% lower than $378 million a year ago.This was due mainly to the absence of gains from the en bloc sale of Keppel Cove in Zhongshan, China and lower contribution from Singapore property trading. The decline was partly offset by gains from disposing a partial interest in Dong Nai Waterfront City, Vietnam.The Infrastructure Division’s net profit of $16 million for 1Q19 was 38% lower than a year ago.This was mainly due to lower contributions from the energy infrastructure and logistics businesses, as well as a share of losses from Keppel Infrastructure Trust in the current period.Earnings per share (EPS) fell 40% to 11.2 cents.As at end March, cash and cash equivalents stood at $1.72 billion.“The main pieces of our strategic transformation are in place. Our focus is now on execution. When we have successfully executed on our strategy, Keppel will be a powerhouse of urbanisation solutions, with not only higher profits, but also higher quality, recurrent earnings,” says Loh Chin Hua, CEO of Keppel Corp.“We will work all our engines hard towards achieving a mid-to-long term ROE target of 15% for the group,” he adds.Shares in Keppel Corp closed 0.3% lower at $6.74 on Thursday, before the announcement.
SINGAPORE (Apr 17): Keppel Offshore & Marine (Keppel O&M) has secured integration and upgrading contracts worth a combined value of about $160 million through its wholly-owned subsidiaries.The first contract is between Keppel Shipyard and a leading operator of oil and gas production vessels for fabrication and integration work on a Floating Production Storage and Offloading (FPSO) vessel.The shipyard's work scope includes the fabrication of several topside modules, the riser balcony, the spread-mooring and the umbilical support structures as well as installation and integration of associated equipment and all topside modules onto the FPSO.Work is expected to start in 3Q19 with delivery scheduled for 2021.The second contract is between Keppel FELS and Diamond Offshore for the upgrade of the drilling semisubmersible rig Ocean Onyx.Keppel FELS' scope of work includes the engineering, fabrication and installation of new pontoons, columns, bracings and a wing deck. The Ocean Onyx was first upgraded in 2012 by Keppel AmFELS, Keppel O&M's yard in the US, from an old semisubmersible rig.Scheduled for delivery in 2H19, Ocean Onyx will initially be deployed offshore Australia.Diamond Offshore is Keppel FELS' long-standing customer and the two companies have collaborated on more than 12 projects since 2005.Chris Ong, CEO, Keppel O&M, says, "These contracts from repeat customers are testament to Keppel O&M's strong customer service in delivering on time, within budget and safely as well as our extensive track record in modification and upgrading projects for a wide variety of products such as FPSOs and drilling rigs."With strong engineering expertise and project management capabilities, we work closely with our clients to understand their requirements and provide customised, reliable, cost-efficient and value-added solutions."Keppel O&M is a wholly-owned company of Keppel Corporation which is announcing its 1Q results tomorrow.See: Keppel to see stronger 1Q earnings on property trading and divestment, says CGS-CIMBShares in Keppel closed 15 cents higher at $6.76 on Wednesday.
SINGAPORE (Apr 17): Keppel Corp is announcing its 1Q19 results on Thursday, after market close.CGS-CIMB Research expects Keppel to achieve net profit of $230 million largely be driven by property trading and divestment of interests in the Dong Nai project in Vietnam.The research house says the restructuring of Keppel’s various businesses are slowly falling into place with the completion of M1’s acquisition; the privatisation of Keppel T&T (KTT) and with the long-awaited delivery of Sete Brasil semi-subs.“In the short term, Lim expects Keppel’s share price to be sustained by stronger q-o-q 1Q19 earnings, driven by profitability in Offshore & Marine and divestment gains,” says lead analyst Lim Siew Khee in a recent report.CGS-CIMB is maintaining its “add” and target price of $8.41, based on SOP valuations. Stronger than expected O&M recovery could be a key catalyst for the stock.Lim says the completion of the M1 acquisition and privatisation of Keppel T&T (KTT) should enable Keppel to begin executing its transformation plans even though Keppel’s net gearing could go up from 0.4x in FY18 to 0.6x in FY19.But before M1 can see a major transformation, she says cost optimisation and cross-selling for the telco should be its near-term priority.Consolidation of M1 should contribute $6-7 million in 1Q19 but looking further ahead, Lim forecasts M1 to contribute $67 million in FY19F and $58 million in FY20F to Keppel, based on effective ownership of 84% via Konnectivity and 100%-owned KTT.Meanwhile, privatisation of KTT should expedite asset injection of 100% SGP 4 into Keppel DC REIT.“We think this could take place in 2H19 with stronger y-o-y occupancy and stabilisation of assets,” says Lim, “Our REIT analyst estimates SGP 4 to be valued at $420 million with KTT owning 40%...”As for Keppel O&M, Lim says the semi-subs option exercised by Awilco at US$425 million ($575 million) in March shows there is potential for more orders of floaters in its $2.5 billion order wins assumption for 2019.Near-term catalyst could be the long-awaited delivery of two semi-subs from Sete Brasil, either to Borr Drilling or Magni Partners or to Keppel which could keep to generate recurring chartering income.Without provisions seen in 4Q18, the research house expects Keppel O&M to deliver net profit of $5 million with EBIT margin of 4% from the Awilco semi-subs.As at 12.46pm, Keppel is trading at $6.78 or 7.8x FY19F -- below its 10-year average of 12x -- with P/BV of 1.04.
SINGAPORE (Apr 17): Analysts are keeping their bullish stance on Keppel DC REIT (KDCREIT), after the group on Monday announced 1Q19 results that were in line with expectations.KDCREIT reported distribution per unit (DPU) of 1.92 cents for the 1Q19 ended March, some 6.7% higher than DPU of 1.80 cents a year ago.This formed 24.5% and 24% of full-year forecasts for OCBC Investment Research and CGS-CIMB Research, respectively.The increase was driven by the acquisitions of maincubes Data Centre in Germany and Keppel DC Singapore 5 in March and June 2018, respectively.See: Keppel DC REIT reports 6.7% rise in 1Q DPU to 1.92 cents on new acquisitionsOCBC is keeping its “buy” call on KDCREIT with a higher fair value estimate of $1.64 from $1.60 previously, while CGS-CIMB is maintaining its “add” recommendation with an unchanged target price of $1.54.The analysts note that KDCREIT had undertaken asset enhancement initiatives at three of its assets during the quarter to improve efficiency and bolster quality.Retrofitting works at Keppel DC Singapore 3 are scheduled to be completed in mid-2019, asset enhancement works to improve energy efficiency at Keppel DC Dublin 1 look set to be completed by 2020, and power upgrading and fit-out works at Keppel DC Dublin 2 are slated to be completed in 2H19.In addition, OCBC analyst Andy Wong Teck Ching believes KDCREIT has ample debt headroom to drive inorganic growth.“Encouragingly, management shared that its pipeline of potential acquisitions looks healthy this year, and this is underpinned by its business development activities although the market has not seen much data centre transactions in the past several months,” Wong says.“We continue to like KDCREIT for its pure-play exposure to the growing data centre industry and its acquisition-led growth story,” says CGS-CIMB analyst Lock Mun Yee.As at 12.28pm, units in KDCREIT are trading 1.3% down at $1.47.According to OCBC valuations, this implies an estimated price-to-earnings (PE) ration of 18.4 times and a dividend yield of 5.3% for FY19.
SINGAPORE (Apr 16): Keppel Infrastructure’s wholly-owned subsidiary, Pipenet, as a lead consortium partner together with Asia Projects Engineering, has secured a $52.5 million contract to design and build two 48in crude oil pipelines and ancillary facilities along parts of Banyan Drive, Banyan Avenue and the Jurong Island Highway that will facilitate pipeline connection to the Jurong Rock Caverns on Jurong Island. Keppel Infrastructure is in turn a wholly-owned subsidiary of Keppel Corporation.
SINGAPORE (Apr 15): The manager of Keppel DC REIT has announced distribution per unit (DPU) of 1.92 cents for the 1Q19 ended March, some 6.7% higher than DPU of 1.80 cents a year ago.This implies a distribution yield of 5.1% for Keppel DC REIT, based on the closing price of $1.50 on the last trading day of 1Q19.1Q19 distributable income jumped 29.9% to $27.1 million, from $20.9 million a year ago. This was mainly due to an enlarged asset base following the acquisitions of maincubes Data Centre in Germany and Keppel DC Singapore 5, which were completed in March and June 2018, respectively.Gross revenue rose 26.4% to $48.0 million in 1Q19, from $38.0 million a year ago.This was led by higher gross rental income due to the acquisitions of maincubes DC and KDC SGP 5.Property operating expenses climbed 22.5% to $4.8 million, from $3.9 million a year ago.This was mainly due to acquisition of KDC SGP 5, as well as higher property-related expenses recorded at KDC DUB 1 and KDC DUB 2.Consequently, net property income grew 26.8% to $43.2 million in 1Q19, from $34.1 million a year ago.Keppel DC REIT’s portfolio occupancy rate stood at 93.2% as at March 31, 2019, with portfolio weighted average lease expiry (WALE) at 8.0 years.As at end March, cash and cash equivalents stood at $127.9 million.Looking ahead, Keppel DC REIT says it is well-placed to benefit from the growth of the data centre market.It adds that this is supported by the rapid growth in data creation and storage needs, increasing digitalisation and cloud adoption as well as the development and adoption of new technologies such as 5G mobile networks, driverless vehicles, virtual reality, and the Internet of Things (IoT), among others.The manager says it maintains a proactive asset management strategy to improve the efficiency and returns of its portfolio, and will continue to maintain its focused investment strategy to capture value and strengthen its presence across key data centre hubs.Units in Keppel DC REIT closed 0.7% higher at $1.49 on Monday.
Earnings from Keppel Corporation and CapitaLand Commercial Trust, US February trade balance, the Indonesia election are some of next week's highlights.
SINGAPORE (Apr 9): Keppel Singmarine, a subsidiary of Keppel Offshore & Marine (Keppel O&M) which is part of the Keppel Group, is set to develop Singapore's first autonomous tug.The project will involve modifying a 65mt tug by retrofitting advanced systems such as position manoeuvring, digital pilot vision, as well as collision detection and avoidance.An onshore command centre will also be set up to remotely control the tug.When the project is completed in 4Q20, the tug will be operated by Keppel Smit Towage.Keppel O&M is also partnering M1, another member of the Keppel Group, to leverage M1's ultra-low latency 4.5G network connectivity to establish standards & data transfer links in terms of latency and reliability for the ship to shore communication, and support mission-critical Internet-of-Things (IoT) maritime applications.To develop the autonomous tug, Keppel O&M has secured a grant of up to $2 million from the Maritime and Port Authority of Singapore (MPA) under its Maritime Innovation and Technology Fund.This follows the Memorandum of Understanding signed by Keppel O&M, MPA and the Technology Centre for Offshore and Marine, Singapore (TCOMS) in April 2018 to jointly develop autonomous vessels for a variety of applications including undertaking harbour operations such as channelling, berthing, mooring and towing operations.Chris Ong, CEO of Keppel O&M, says, "We are proud to be at the forefront of innovation with the development of autonomous tugs that are commercially viable. The maritime industry is transforming and we are glad to be able to partner MPA and TCOMS in exploring how to improve the industry with new technologies."
SINGAPORE (April 1): Keppel Corporation, through its wholly-owned subsidiary KepVenture, is investing US$50 million ($67.7 million) for a minority stake in Envision AESC Group.Envision AESC Group is an intelligent lithium-ion battery company which is 80:20 owned by China’s Envision AESC Holding and Japanese automobile manufacturer Nissan. It recently acquired Automotive Energy Supply Corporation (AESC), a former venture between Nissan Motor Company and Blackstone-owned NEC Group. It also wholly owns NEC Energy Devices, a battery electrode manufacturing company owned by NEC Corporation.According to Keppel, Envision AESC Group has a capacity of 7.5GWh and a workforce of 1,400 employees across Japan, the US and the UK – and is in the midst of expanding its production into China, while “engaging various global automakers to grow its customer base”.In its filing on Monday, Keppel says its co-investment with Envision is in line with the group’s efforts to deploy innovative concepts in its solutions for sustainable urbanisation.Both Keppel and Envision are working to introduce Internet-of-Things (IoT) enabled storage devices that can help smart buildings and smart grids to become more energy efficient – while also exploring other potential areas of collaboration to create new solution for smart cities and renewable energy, among others.“This investment in the electric vehicle (EV) battery businesses is part of our strategy to expand the Keppel Group’s energy solutions with cleaner fuel sources and renewables,” says Loh Chin Hua, CEO of Keppel.“We are pleased to partner Envision on a platform that will deepen our insights into the fast-growing EV market, and where we can explore opportunities to apply smart energy storage devices to enhance the safety and carbon efficiency of the Keppel Group’s solutions for sustainable urbanisation,” he adds.Shares in Keppel Corp closed 1.45% higher at $6.31 on Monday.
Keppel Capital and its co-investors have entered into a shareholders' agreement on March 25 to acquire Yi Fang Tower for RMB 4.6 billion ($925 million). This was done through the joint venture company North Bund Keppel. The acquisition is expected to be completed in the second quarter of 2019.