Highlights of Achievements in 2022
1. Accelerate Business Transformation
During the year, we made good progress in executing our Vision 2030.
During the year, we made good progress in executing our Vision 2030.
Net Profit
$927m
Compared to $1.02b for FY 2021
Gearing
0.78x
at end-2022, compared to 0.68x at end-2021
Cashflow
$408m
outflow, compared to $1.76b inflow in FY 2021
ROE
8.1%
Compared to 9.1% for FY 2021
Total Dividend
33cts
Cash dividend per share, unchanged from FY 2021
Continue Staff Engagement and Development
Enhance Succession Planning
Governance
Compliance and Risk Management
Safety
Work Towards ESG Goals, including Carbon Emissions Reduction Targets5
Work Towards ESG Goals, including Carbon Emissions Reduction Targets5
Make Positive Impact on the Community
Volunteers
Contribution to Worthy Causes
Accelerate Business Transformation
Drive Financial Performance
Develop Human Capital
Enhance Governance, Compliance, Risk Management & Safety
Champion Sustainability
Accelerate Business Transformation
Drive Finance Performance
Develop Human Capital
Enhance Governance, Compliance, Risk Management & Safety
Champion Sustainability
1 Includes $0.2 billion received on the sale of 1 Borr rig, which has been transferred to Asset Co as part of initial working capital.
2 External revenue from cross-business unit collaboration is an internal management metric that includes share of economic benefits from joint ventures, associates and certain investments.
3OneRE – One Real Estate; One Infra – One Infrastructure; OneDC – One Data Centre.
4 The recurring income in FY 2021 was restated, as Keppel O&M’s income was re-classified as discontinued operations.
5 Further details will be provided in Keppel’s Sustainability Report to be published in May 2023.
Keppel has a strong track record in innovation and transformation.
During the year, the Group’s innovation efforts were centred around Keppel’s Vision 2030 strategy, from assessing the impact of mid- to long-term technological and business model shifts on the Group, to accelerating the development of new growth engines and strengthening the resilience of its businesses through differentiation.
Technology and innovation efforts are driven both at the Group and business unit (BU) levels. BUs focus on the key growth areas identified as part of Vision 2030, leveraging their technical and operational expertise and network of partners and in-country presence. At the Group level, Keppel Technology & Innovation drives technology foresight, identifies long-gestation opportunities in collaboration with BUs, and cross-fertilises ideas among BUs, leveraging their distinct capabilities to create unique competitive advantages for the Group.
In addition, the Group Digital Office (GDO) was established in March 2022 to catalyse digital transformation. Headed by the Chief Digital Officer, the GDO drives digitalisation and automation to improve efficiency across the Group’s assets and operations.
Beyond in-house capabilities, the Group also taps the insights of the Keppel Technology Advisory Panel (KTAP), comprising eminent business leaders and industry experts from across the world, which guides the Group’s innovation journey and provides technology foresight. This includes monitoring of early-stage industry developments, and new technologies as well as future scenario mapping. Through the KTAP members, Keppel is also able to access their networks so as to stay updated on emerging megatrends, the latest technologies and the changing global landscape.
To address complex and interrelated issues that may be difficult for the Group to solve alone, Keppel adopts a robust ecosystem and value chain approach, working in close partnership with the industry stakeholders including institutes of higher learning, government agencies, global and local corporates, as well as venture funds and start-ups. Our close collaboration with strategic partners helps us to develop innovative, differentiated and integrated solutions. An example is Keppel Infrastructure’s collaboration with Mitsubishi Heavy Industries to carry out a feasibility study on the development of a 100% ammonia-fuelled power plant in Singapore, which can contribute to building a more resilient and sustainable energy sector in Singapore and the region.
As part of Vision 2030, we are embedding sustainability and customer centricity in our innovation efforts. We help our customers in their decarbonisation efforts through our suite of energy-efficient solutions, clean energy and digital solutions.
Keppel views its technology and innovation efforts across three time horizons.
Asset Management: We are delivering to investors in our funds, REITs and business trust, access to Keppel’s proprietary-developed assets with unique technologies. For instance, Keppel Infrastructure Trust signed a non-binding term sheet in 2022 to acquire Keppel’s interest in the entity that owns the Keppel Marina East Desalination Plant, which was developed by, and will continue to be operated and maintained by Keppel Infrastructure.
Energy & Environment: We are focused on developing decarbonisation and integrated environmental solutions. In the area of low-carbon power, together with our partners, we have advanced the development of clean energy value chains, such as renewables imports, ammonia and hydrogen. In the environmental space, we have partnered with the National Environment Agency to study the feasibility of carbon capture for waste-to-energy plants in Singapore.
Urban Development: We are developing new living and working concepts, seizing opportunities in up-and-coming real estate segments, such as sustainable urban renewal and senior living, with a strong focus on improving the customer experience. We look to develop Real Estate-as-a-Service solutions to grow our recurring income.
Connectivity: We are enhancing the sustainability of our data centres through the development of power-efficient solutions, such as data centre-grade infrastructure solutions. M1 is transforming itself from a traditional telco to a cloud native connectivity platform, and is leveraging its 5G network to develop innovative 5G use cases jointly with partners, such as Gardens by the Bay and Electronic Sports to enable metaverse experiences.
Keppel has also invested directly into high-growth companies and start-ups, as well as in venture funds, which help us accelerate our learning and value-add to our ecosystem. This includes our investment in Envision AESC – one of the world’s leading electric vehicle battery companies. We are also collaborating with the wider Envision Group, a leading green technology partner and net zero tech partner, to explore the development and supply of low-carbon electricity solutions.
Keppel Infrastructure was awarded a grant from the Energy Market Authority (EMA) and JTC to pilot Singapore’s first membrane-based nearshore floating solar photovoltaic (PV) system at Jurong Island. The pilot PV system consists of three circular platforms, which will have an installed capacity of 1.5 MWp.
Compared to conventional floating PV systems used in calmer water bodies such as reservoirs, this membrane-based PV system is designed based on floating PV specialist Ocean Sun’s technology to harness solar energy reliably amid sea conditions, including strong waves and wind. This is achieved through the flexible circular surface membranes which undulate with the waves, providing a favourable distribution of loads and forces, thereby reducing stress to the PV system.
The reinforced membranes for the PV panels also ensure the lowest material usage of any floating PV system, enabling resource conservation. The system is also easy to deploy and install, with increased efficiency from direct water cooling.
When completed, Keppel Infrastructure’s pilot membrane-based nearshore floating PV system can serve as a model for future scaling and replication in nearshore waterbodies in Singapore as well as overseas.
With limited land space in Singapore, this robust and innovative system can help to catalyse the deployment of renewable energy using unutilised sea space.
The award was part of EMA and JTC’s Jurong Island Renewable Energy Request for Proposals to accelerate the development of clean energy innovations for implementation on the island. Projects will be funded by a $6 million joint commitment by EMA and JTC, with support from Enterprise Singapore.
To accelerate the integration of our value chains, we established One Real Estate (OneRE), One Infrastructure (OneInfra) and One Data Centre (OneDC) teams, comprising senior personnel from across the Group’s business units (BUs) to evaluate and execute on opportunities across our focus areas.
The cross-BU teams adopt a horizontal approach, i.e. cradle-to-maturity, in evaluating opportunities across the projects’ development stages and life cycles, whether they are investments by the Group’s operating entities, private funds, listed REITs or business trust.
By bringing together Keppel’s different experience and capabilities, this OneKeppel approach allows Group to create value beyond what each business unit can achieve on its own. It also allows the Group to undertake more complex deals, without depending solely on its balance sheet. By drawing on the unique strengths of each operating unit, pooling talent and resources, as well as tapping third-party capital, the Group is able to realise synergies and optimise strategic execution and resource allocation, thus achieving more with less.
In 2022, the Group announced more than $2.8 billion worth of energy & environment and sustainable urban renewal-related investments, jointly undertaken by Keppel together with the private funds and/or business trust managed by Keppel Capital.
Keppel Corporation and Keppel Infrastructure Trust announced the joint acquisition of interests in European onshore and offshore wind energy assets for $679 million. These comprise stakes in onshore wind assets in Norway, Sweden and the United Kingdom sponsored by Fred. Olsen Renewables, a leading developer, operator, and owner of renewable energy assets, as well as a German offshore wind farm operated by Ørsted, which is a world leader in offshore wind power. Together, these investments added more than 700 MW to Keppel’s growing renewable energy portfolio, which expanded to about 2.6 GW by the end of 2022.
Keppel Infrastructure has reached final investment decision on the 600 MW Keppel Sakra Cogen Plant, Singapore’s first hydrogen-ready and most advanced, high-efficiency combined cycle power plant. Running initially on natural gas as a primary fuel, the Plant is designed to operate on fuels with at least 30% hydrogen content and has the capability of shifting to run entirely on hydrogen. The Keppel Sakra Cogen Plant is intended to be owned by Keppel Asia Infrastructure Fund and Keppel Infrastructure, reflecting the Group’s strong development capabilities and asset-light business model as it seizes opportunities in the energy transition.
Keppel Infrastructure Trust, Keppel Asia Infrastructure Fund and Keppel Infrastructure jointly acquired a 100% stake in South Korean waste management company, Eco Management Korea Holdings (EMK) for approximately $666 million. Operating six waste-to-energy (WTE) plants and five sludge drying facilities, EMK has the third largest incineration capacity in Korea. It is also the largest waste oil refiner and owns and manages a landfill, which has the fourth largest capacity in Korea. The investment in EMK is a prime example of how Keppel and the private funds and/or business trust can collaborate to seize growth opportunities swiftly.
Leveraging Keppel Seghers’ leading WTE technology, Keppel Infrastructure can complement EMK’s growth in the South Korean market. Keppel Infrastructure can also tap EMK’s presence in South Korea as a beachhead to explore other environmental and Energy-as-a-Service opportunities.
Keppel is exploring the development of a nearshore data campus project, that brings together the Group’s diverse expertise in developing and operating data centres as well as clean energy and infrastructure solutions. Datapark+ is envisioned to be a scalable, state-of-the-art, low-carbon, modular data centre campus, with centralised utilities that deploys renewables to reduce its carbon emissions, and with an extensive hydrogen transport network, thereby accelerating Singapore’s transition to hydrogen. With the growing investor demand for clean critical infrastructure, Keppel is exploring opportunities to bring in third-party operators and co-investors for this landmark project.