Netlink NBN Trust has posted 2.9% higher revenue y-o-y of $205.3 million for its 1HFY2024 ended September. While ebitda grew 2.4% y-o-y to $149.1 million, Netlink’s profit after tax fell 3.1% y-o-y to $52.9 million over the same period.
In a Nov 3 bourse filing, Netlink has proposed a distribution per unit (DPU) of 2.65 cents for 1HFY2024, 1.1% higher y-o-y.
Netlink attributed the higher revenue to higher connections, installation-related, co-location, and central office revenue. This was partially offset by lower ducts and manholes services, and ancillary project revenue.
Non-Building Address Point (NBAP) and segment connections revenue increased most significantly by $1.8 million, mainly from higher demand for point-to-point connections to support mobile network rollout, says management.
Residential connections remained the key contributor to the group’s overall revenue, contributing to 60.1% of total revenue.
Residential connections revenue increased by $1.6 million y-o-y to $123.3 million, in line with a higher number of connections.
See also: Netlink Trust: Internally managed trust that hasn’t raised equity yet
As at Sept 30, there were 1,491,663 connections compared to 1,474,243 connections the year prior, representing an increase of 1.2% y-o-y.
Installation-related and other revenue increased by $1.4 million, mainly contributed by higher non-residential termination points installation orders and more outdoor NBAP connections.
The group’s net cash from operating activities in 1HFY2024 was $153.9 million.
See also: More praise for Netlink NBN Trust following 'stable' 1QFY2024, rising DPU
The group has stated that it will distribute 100% of its cash available for distribution semi-annually. Management says the group’s business model is “resilient and is well-supported by predictable revenue streams”. “The group’s balance sheet and liquidity remain strong, underpinned by stable cash flows and access to financial resources to support future capital expenditure.”
Notwithstanding the increased funding and operation costs, the group expects to maintain its distributions to unitholders.
The Singapore government recently announced an initiative to develop a new digital connectivity blueprint, notes management. “The plan includes the development of future-ready broadband, mobile and Wi-Fi infrastructure… In this respect, Netlink is well positioned to chart the next phase of growth for the Nationwide Broadband Network (NBN). We will provide our expertise and infrastructure to support the upgrade of the NBN that will deliver internet speeds of up to 10 gigabits per second (Gbps).”
The ongoing review of the terms and conditions (including prices) of NetLink Trust’s services offered under its interconnection offer by the Infocomm Media Development Authority (IMDA) is expected to be completed this calendar year.
Units in Netlink NBN Trust closed 0.5 cents higher, or 0.60% up, at 84 cents on Nov 3.
