NetLink NBN reported on Friday that its fiscal second quarter profit after tax was S$18.69 million, beating the projection from its IPO prospectus by 16.2 percent.
Profit after tax for the quarter ended 30 September was 43.9 percent higher than the year-earlier fiscal quarter, but that period started from 19 July 2017, making for a shorter financial period of 74 days, compared to 92 days for the 1 July to 30 September 2018 quarter, the trust’s manager said in a filing to SGX after the market close on Friday.
NetLink NBN owns and operates the passive fiber network infrastructure for Singapore’s next generation nationwide broadband network, or Next Gen NBN, which supplies high-speed internet access in the city-state and connected islands.
Revenue for the quarter was S$90.6 million, beating the projection of S$84.9 million by 6.7 percent, mainly on higher diversion revenue and ducts and manholes service revenue, the filing said, adding that was partly offset by lower-than-expected installation-related revenue.
“Our better-than-forecast earnings reflect the resilience of our business model,” Tong Yew Heng, CEO of the trustee-manager, NetLink NBN Management, said in the statement.
He said the better-than-expected performance spurred a higher distribution per unit (DPU) of 2.44 Singapore cents for the fiscal first half, adding that if the distribution remains the same for the fiscal second half, the annualized DPU of 4.88 Singapore cents would be 5.2 percent over the projected DPU of 4.64 Singapore cents in the prospectus.
For the fiscal first half, profit after tax was S$37.7 million, while revenue was S$176.7 million, both above the IPO projections, the trust’s manager said.
As of 30 September, it had 1.24 million residential end-user connections and 45,514 non-residential ones, up 2.0 percent and 1.6 percent respectively on-quarter, the filing said.
The trust had some cautions on its outlook.
“The trust group remains on track to achieve the number of end-user connections in both the residential and non-residential fibre segments, in the projection,” it said. “Though the trust group expects revenues from key connection services to meet the projection for fiscal 2019, overall revenues may be affected by lower installation revenues.’