Keppel Infrastructure Trust's net profit down 9.2% to $6.9m in Q2

Blame the higher fuel and electricity expenses.

Despite recording a 15.6% higher revenue in Q2 at $158.8m, Keppel Infrastructure Trust (KIT)'s net profit slumped by 9.2% to $6.9m.

This is due to the 39.6% increase in fuel and electricity costs. According to the group, this is due to higher fuel prices and higher volume of natural gas consumed. This also led to the 2.5% increase in gas transportation cost to $23.1m.

The half-year performance of the group painted a different picture, as it showed an improvement in both headline and bottom line.

The group revenue for 1H17 was $314.1m, 16.9% higher than 1H16. This was mainly due to higher contributions from City Gas as a result of higher town gas tariff and higher volume of town gas sold. There is also a higher revenue recorded from Basslink as no facility fees were recognised during the cable outage which occurred between 20 December 2015 and 12 June 2016.

The higher revenue from KMC also contributed to the improvement in the group's yield.

These were partially offset by lower contribution from the Concessions as the 1H16 revenue included construction revenue recognised from the Senoko boiler upgrade.

Meanwhile, the higher profit attributable to Unitholders in 1H17 as compared to 1H16 mainly arose from higher contributions from Basslink and KMC. These were partially offset by lower contribution from City Gas due to the time lag in the adjustment of gas tariffs to reflect actual fuel cost, abortive expenses incurred in connection with a potential acquisition and professional fees incurred for the Basslink outage.

Photo from Keppel.