This brings the total DPU for FY19 to 4.88 cents, which exceeds projection by 5.2% and translates to a yield of 6.0%.
4Q19 earnings increased 30.7% to $20 million, compared to $15.3 million in 4Q18. Revenue for the quarter of $87.9 million was in line with forecast and 8.9% higher than $80.7 million a year ago.
See: NetLink NBN posts 31% rise in 4Q earnings to $20 mil; declares 2.44 cents DPU
NLT continues to benefit from the migration of StarHub’s customers to an all fibre-network. Residential fibre connections grew 11% y-o-y and 3.4% q-o-q.
Meanwhile, non-residential fibre connections grew 5% y-o-y and 1% q-o-q. In a May 15 report, lead analyst Chong Lee Len reckons that the slower growth is due to weak business sentiment as a results of the US-China trade conflict.
Looking forward, focus for the trust in FY20 includes: Higher revenue driven by higher residential connections and installation-related revenue; continuing to invest in expanding the network and utilising the $10 million capex reserves on projects that will improve the network’s capability and resiliency.
Regulated capex is also expected to be higher in FY20 as management seeks to improve the network.
As at 11.45am, units in NLT are trading at 82 cents or 1.1 times FY20 book with a dividend yield of 6.0%.
