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Netlink NBN Trust declares 0.4% higher 1H DPU of 2.53 cents
The manager of Netlink NBN Trust has declared distribution per unit (DPU) of 2.53 cents for the 1HFY2021, up 0.4% from the 2.52 cents posted a year ago.
This comes on the back of 1HFY2021 earnings of $44.8 million, up 1.5% from the $44.1 million registered in 1HFY2020.
Revenue for the half-year period dipped by 2.5% y-o-y to $181.5 million, mainly due to lower installation-related revenue, diversion revenue and revenue from ducts and manholes services.
The group reported higher earnings before interest, taxes, depreciation and amortisation (EBITDA) of $139.7 million, up 3.4% y-o-y, and 1.5% higher y-o-y profit after tax (PAT) of $44.8 million.
The lower revenue was partially offset by higher residential connections revenue.
According to Netlink, the group&rsquo s fibre business revenue continues to be supported by the growing number of residential connections.
Recurring revenue from residential connections climbed 4.1% y-o-y to $118.5 million in 1HFY2021, contributing to 65.3% of the group&rsquo s total revenue.
As at Sept 30, there were 1,437,360 residential connections as compared to 1,410,627 connections the year before.
Installation-related revenue fell 44.3% y-o-y to $6.9 million mainly due to lower installation charges from few installation orders and service activations as StarHub was migrating its coaxial subscribers onto fibre.
There was a lower availability of contractor resources and restricted access to home and buildings from April to August due to Covid-19, which affected the completion of installation works during the half-year period.
Diversion revenue fell 47.4% y-o-y to $3.3 million due to fewer completed projects. The stoppage of construction work around the nation affected cable diversion work, says the group.
Ducts and manholes service revenue dropped 6% y-o-y to $14.6 million due to the lower completion of joint-build projects and a reduction in service revenue from the leasing of NetLink&rsquo s ducts.
As at Sept 30, cash and cash equivalents stood at $181.4 million.
NetLink says it has a &ldquo resilient&rdquo business model that is well-supported by predictable revenue streams from monthly recurring charges for fibre connections to residential and non-residential premises, and non-building address points (NBAP) locations and contracted revenues.
&ldquo The Covid-19 situation has highlighted the importance of fibre broadband as an essential service to end-users&rsquo daily lives. Fibre broadband is considered a necessity given the increasing number of end-users who are reliant on fibre broadband services for a wide range of activities,&rdquo says Tong Yew Heng, CEO of the manager.
&ldquo The NetLink Group will continue to work closely with industry partners to support Singapore&rsquo s digitalisation efforts even as we grow our residential connections by connecting new homes and supporting initiatives such as the Home Access Programme,&rdquo he adds.
Any idea why Netlink' s price has been falling recently?
Trusts' corporate governance score have ' stagnated, regressed'
NETLINK NBN Trust has retained its number one spot in the Governance Index for Trusts (Gift) 2020, although the overall average score for the sector has dropped partly due to a raising of standards.
The Gift ranking, produced by Mak Yuen Teen, associate professor of accounting at the NUS Business School, and Chew Yi Hong, an active investor and keen observer of the corporate governance scene, is a study of Singapore-listed trusts. It was first launched in 2017, and is supported by the Singapore Exchange (SGX).
The index assesses the governance and business risks of 45 out of the 50 real estate investment trusts (Reits) and business trusts (BTs) listed here. It has excluded Eagle Hospitality Trust (EHT) because the Reit is suspended and its annual report was issued after the cut-off date.
Besides Netlink NBN Trust, the other top-ranked trusts in Gift 2020 include Keppel DC Reit, Aims Apac Reit, CapitaLand Commercial Trust, Manulife US Reit and Mapletree North Asia Commercial Trust.
At the other end, the six lowest-ranked trusts are Asian Pay Television Trust, First Reit, Lippo Malls Indonesia Retail Trust, Accordia Golf Trust, Dasin Retail Trust and Hutchison Port Holdings Trust.
This year, Gift 2020 introduced new merit and demerit items and made adjustments to the scorecard, taking into account changes in regulation and the impact of Covid-19 on meetings. Given this, the scores for this year are not directly comparable to those in previous years.
" The raising of the bar contributed to the average combined governance and business risk score falling from 68 in 2019 to 64.3 this year," it said.
Prof Mak noted that while there are some areas of improvement such as in the areas of posting of annual general meeting (AGM) minutes and disclosure of exact remuneration of non-executive directors, he felt that overall, standards have " somewhat stagnated, regressed or not met expectations" .
For instance, he noted that it was " disappointing" that only six trusts - Keppel DC Reit, Keppel Infrastructure Trust, Keppel Reit, Netlink NBN Trust, Parkway Life Reit and Starhill Global Reit - allow unitholders to endorse directors at the AGM.
" Given the fact that all directors of Reit managers and trustee-managers are appointed by the shareholders of the managers, and not the unitholders of the trust, it is difficult for independent directors (IDs) to be perceived to be truly independent. The issue of independence of IDs has arisen in several cases during the past year, and becomes particularly contentious in merger and privatisation situations."
He added that the regulations for Reits and BTs specify a list of criteria for determining independence, but allow the board to determine whether a director is independent even if they do not meet the criteria. " It is not uncommon for trusts to use this flexibility given by the regulations."
He also observed that a third of the managers collected higher fees while delivering lower distribution per unit (DPU). Another 40 per cent had their fees increase faster than the increase in DPU increase, or decrease less than the drop in DPU.
Other areas that the authors felt trusts could do better include improving the diversity of boards having nominating and remuneration committees continuing with quarterly reporting or at least informative quarterly updates and avoiding holding meetings on peak days of the AGM season.
The authors also noted that although on average, Singapore-listed trusts are still well financed, investors should watch indicators of business risks such as leverage, interest coverage, foreign currency exposure, lease expiry and use of hybrid securities, as the sector moves from a focus on stability and income generation to a focus on growth.
Prof Mak said: " With the sector having matured, increasing consolidation, more trusts venturing overseas and the debacle involving EHT, it is important that corporate governance standards be raised and changing risks be adequately recognised so that the good work done by (the Monetary Authority of Singapore) and SGX in building up the sector in the past decade is not undone."
Mr Chew also encouraged investors to be more discerning and examine the track record of the managers and trustee-managers in creating value for unitholders. " The incentives for the managers may not be aligned with the interests of unitholders, although Reit managers and their directors have a legal obligation to act in the best interests of unitholders," he said.
https://www.voanews.com/east-asia-pacific/voa-news-china/chinese-5g-not-living-its-hype?amp
Joelton ( Date: 12-Oct-2020 09:18) Posted:
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NetLink NBN Trust
On Oct 2, NetLink Trust (NLT) non-independent executive director and CEO Tong Yew Heng acquired 100,000 units of the business trust for a consideration of S$97,000.
This followed his acquisition of 200,000 units on Sept 29 also at 97 cents per unit.
The recent acquisitions have taken Mr Tong' s direct stake in the business trust to 650,000 units as of Oct 2.
In a presentation on Oct 2, NLT noted that its network now connects its central offices to 1,428,272 residential homes, 46,988 end-users across non-residential premises, and 1,772 connections to non-building address point (NBAP) locations.
NetLink NBN Trust
On Sept 29, NetLink Trust (NLT) independent executive director and CEO Tong Yew Heng acquired 200,000 units of the business trust for a consideration of S$194,000.
This took his direct stake in the Trust to 550,000 units.
Mr Tong has been the CEO of NLT since January 2016.
In this role, he is responsible for the overall leadership and performance of NLT.
Prior to joining NLT, Mr Tong was executive vice-president, corporate & market development, of Singapore Technologies Electronics Ltd.
Before that, he was CEO of CitySpring Infrastructure Trust.
Looking at previous years, the next dividend likely to be in November.
No wonder share price is not moving.
No wonder share price is not moving.
lennyk ( Date: 18-Sep-2020 17:23) Posted:
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wow someone just dumped a buttload of stocks at the end
final volume is like 45 million
any idea whats going on ?
final volume is like 45 million
any idea whats going on ?
CGS-CIMB calls NetLink defensive yield play, initiates coverage with ' add'
CGS-CIMB has initiated coverage on NetLink NBN Trust with " add" and a target price of S$1.10, viewing the fibre-optic cable owner as a defensive yield play amid market volatility, given its high barriers to entry, strong earnings visibility and stability.
Units of NetLink were trading up 0.5 Singapore cent or 0.5 per cent at 97 cents as at 1.13pm on Thursday.
CGS-CIMB analyst Ong Khang Chuen said in the current low-interest-rate environment, the trust offers an attractive dividend yield of about 5.4 per cent based on CGS-CIMB' s fiscal 2021 forecast. He also sees a potential total return of 19 per cent.
" We believe NetLink' s business is resilient to economic and business cycles, given the utility-like nature of broadband," he said.
NetLink is the sole network provider of residential fibre broadband in Singapore, with over 1.43 million residential connections or a 94 per cent penetration rate as at end-June 2020.
CGS-CIMB sees a lower risk of dividend cuts for NetLink versus real estate investment trusts (Reits), which are expecting weaker occupancy rates and rental reversions due to the Covid-19 impact.
For Maybank Kim Eng analyst Kareen Chan, certain Reits may also exhibit higher distribution per unit downside from capital preservation on weaker outlook. Hence, NetLink' s less volatile business offers a better yield play over said Reits and telcos which are seeing a decline in average revenue per user.
As a " shelter to wait out the storm" , the trust is also a good option for investors to switch from banks for relatively higher dividend sustainability, seeing its strong cash flow is backed by fixed regulatory pricing till end-2022, she said.
Maybank Kim Eng reiterated its " buy" call on NetLink with an unchanged target price of S$1.07 in a separate research note dated Tuesday.
The Monetary Authority of Singapore' s move to call on banks to cap their FY2020 estimate dividend yields may cause lenders' average dividend yield for the fiscal year to fall to 4 per cent, Ms Chan added.
Thanks. Added more recently.. just not sure if there' s something that I am unaware of. Usually a fair balance of buying and selling, but selling seems a little more than usual recently.
Vietshare ( Date: 06-Aug-2020 09:48) Posted:
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Not entirely a balance way to say things IMO. if there is selling then there must be a corresponding buying. IMO, what is imnportant to note is that its share price has been stagnant for two months or so already oin an average of 2000lots/day trade (i.e. no dump down or increase in confidence). One can translate this to equal number of shareholders positive and negative about this counter. My guess is that it will remain like this for a lengthy period of time And as the saying goes, time is money. So it is an opportune time to reposition your investment IMHO.
sg_dew ( Date: 06-Aug-2020 09:18) Posted:
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I noticed that there has been much selling of Netlink recently. Any idea why?
NetLink logs 12.4% rise in Q1 net profit despite labour constraints
FIBRE-OPTIC cable owner NetLink NBN Trust posted a 12.4 per cent increase in net profit to S$23.5 million for Q1 FY2021 ended June, even as its top line shrank with restricted manpower and access amid the Covid-19 pandemic.
The mainboard-listed trust' s Q1 revenue dipped 3.3 per cent to S$89 million, on the back of decreases in activity-based installation and diversion revenues. This was partly cushioned by a S$2.9 million rise in revenue from fibre connections, given a 3.3 per cent increase in residential connections.
NetLink' s Q1 installation revenue fell by S$4.7 million, due to fewer orders and service activations than a year ago, when StarHub was migrating its coaxial cable subscribers onto fibre.
The firm was also hit by fewer contractor resources and restricted access to homes and buildings amid Covid-19, which affected the completion of installation works.
Meanwhile, diversion revenue fell by S$900,000, as stoppages of construction work nationwide impacted cable-diversion work, leading to fewer completed and billed projects.
Even so, NetLink' s Ebitda (earnings before interest, taxes, depreciation and amortisation) rose by 3.4 per cent to S$68.8 million, due to the recording of government relief grants under other income.
With higher profits and cash received for property tax rebates, NetLink strengthened its net operating cash flows to S$65.1 million, S$8.6 million higher than a year ago.
Covid-19 continues to impact the company, with the reduced availability of contractors' manpower resources having constrained its ability to fulfil service requests from April. Nevertheless, NetLink does not expect the delays in fulfilling requests to have a long-term impact on its revenue.
The company said in a statement: " Despite temporary operational issues resulting from the Covid-19 pandemic, NetLink' s resilient business model is well-supported by predictable revenue streams.
" With a strong balance sheet and liquidity underpinned by stable cash flows and the availability of bank facilities, the group is well-positioned to continue to invest and expand its network' s capabilities and resiliency."
Dividend pays semi annually.. So December investor will receive a slight increase in dividend .This counter is more like a saving account which pays better dividend yield than the bank.. It is less volatile so the price won't fluctuate so much. Some investors want to earn quick bucks so this counter is not suitable for them..
Vietshare ( Date: 05-Aug-2020 20:26) Posted:
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Netlink plays dividends at their 1H and 2H only , 1H ends sept 20 . FYI
Netlink is not the only company that can stay afloat during this Pandemic period. With no dividend and if share price remains flat which is has been for about two months now, what then should a shareholder look forward to holdihg this stock? I made a small investment in April into this counter (becsause it kind of corner a certain market) but will pull out the moment I manage to cover brokage so as to reposition the fund to other stocks that either pay dividend consistently and/or share price has better prospect to appreciate.
But I wish you well holding to this counter.
But I wish you well holding to this counter.
JerryMaple ( Date: 05-Aug-2020 19:42) Posted:
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If counter still able to deliver results despite covid pandemic,it is deem resilent..It should attract more investors to this counter.As for the $600k sponsorship to IMDA,this should be a small factor and wont affect the share price much..At least after seeing this result,i am not going to sell my holdings.Really a peace of mind to hold this stock at the current volatile market.
Vietshare ( Date: 05-Aug-2020 19:35) Posted:
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I think the result is only so-so, with no dividend declared but instead a $600k sponsorship to an IMDA initiative. So should shareholders take that sponsorship as potential dividend going somewhere else or as " coffee " money to IMDA in order to get more deals? I do not think shareholders take too kindly to such corporate action, thus no new highs in the near term IMHO.
Tmr new high..
raykee ( Date: 05-Aug-2020 18:41) Posted:
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no thanks giving to investors.....
| JerryMaple ( Date: 05-Aug-2020 18:38) Posted: |