Keppel Q1 net profit dips amidst weaker real estate performance

Recurring income rose slightly on higher operating income and stable asset management profits.

Keppel Ltd. reported a slight year-on-year (YoY) decline in net profit for the first quarter of the year (Q1 2026).

Stronger results from its infrastructure and connectivity businesses were offset by weaker performance in real estate, which had benefited from higher valuation and divestment gains in the same period last year.

Recurring income edged up slightly, supported by higher operating income and steady asset management profits.

When including its Non-Core Portfolio for divestment and discontinued operations, total net profit fell further YoY, mainly due to fair value losses and lower gains from asset sales.

So far in 2026, Keppel has announced $385m in non-core asset monetisation, including i12 Katong.

Since October 2020, total announced monetisation has reached about $14.9b, which includes major transactions such as Keppel Offshore & Marine and the planned sale of M1’s telco business.

The company is targeting another $2–$3b in asset sales this year and has completed about $347m in realised transactions to date.

Separately, Keppel fully exited its 5% stake in Seatrium as of 1 April 2026, generating about $430m in cash and $1m in dividends received in 2025.

Asset management fees rose 13% YoY to $108m in Q1 2026, and funds under management increased by about $400m.

The company also completed $1.3b in acquisitions and $1.4b in divestments during the quarter.

The Infrastructure Division’s Decarbonisation & Sustainability Solutions (DSS) unit continued to secure contracts, winning over $700m in long-term deals in Q1 2026.

This includes a 20-year contract from Singapore’s Housing & Development Board for centralised cooling to nine Build-to-Order projects in Tengah.

Long-term contracts in this segment now total $7.6b, with revenue visibility of 10 to 15 years.

In connectivity, Keppel has started construction on its floating data centre project and plans to begin building Keppel DC SGP 9 in mid-2026, part of its hyperscale data centre campus at Genting Lane.

It is also in advanced talks to sell remaining capacity in its Bifrost cable system, with deals expected in the first half of 2026.

On the implications of the Middle East conflict, the company remained cautiously optimistic.

“Keppel has limited direct exposure to the Middle East, and we have not seen any notable impact on the company thus far,” said Loh Chin Hua, CEO of Keppel.

“If there is a prolonged disruption to gas supply and an energy crunch, this could have broader impacts on energy security and the macroeconomic environment, which may in turn affect Keppel, including on fundraising and asset monetisation,” he added.

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