Daily news - 24 Oct

Keppel profit rises 10.2% in Q3 despite higher costs
Keppel Corp managed to maintain its growth momentum in Q3 with a 10.2 per cent rise in profit to $272.9 million on the back of a 24.1 per cent increase in revenue to $3.2 billion. Profit for the first nine months also kept pace with a 10.1 per cent gain to $833.9 million on revenue of $8.1 billion. Q3 earnings per share was 10.4 per cent higher at 17 cents. Costs, however, shot up. Continuing a rising trend, staff costs increased 38.4 per cent from the previous corresponding period to $382.2 million and this was $95.3 million or a third more than the preceding quarter. Materials and subcontract costs rose 19.7 per cent to $2.4 billion while other operating expenses ballooned more than five times to $112 million. All these extra costs were attributed to the offshore and marine (O&M) division. Increased activities and higher headcount raised materials and subcontract costs as well as staff costs. Higher overheads for items like yard rentals and maintenance, lower write-back of provision for stocks and work-in-progress, fair-value loss on investments and higher foreign exchange loss caused the jump in other operating expenses.

CCT Q3 distributable income rises 46.1%
CapitaCommercial Trust (CCT) has reported distributable income of $43.2 million for the third quarter ended Sept 30, up 46.1 per cent from $29.6 million a year earlier and 3.8 per cent above the Reit manager's forecast. The strong result was attributed to higher gross rental income from CCT's portfolio and income from 1 George Street from July 11. Q3 net income from 1 George Street was $11.09 million. The trust's distribution per unit (DPU) of 3.1 cents for Q3 is 44.9 per cent more than in Q3 2007 and 4 per cent above forecast. Its gearing ratio rose to 36.3 per cent in Q3, from 29.1 per cent previously. Total debt increased to $2.54 billion, from $1.83 billion. Lynette Leong, CEO of the Reit manager, said: 'We have always employed a pro-active approach in the execution of our capital and risk management strategies. CCT's current gearing is at a prudent level of 36.3 per cent and the interest cost for 2008 is 100 per cent fixed.' The trust's interest service coverage ratio at end September was 3.1 times and its average cost of debt was 3.6 per cent.

Source: Kim Eng