NetLink NBN Trust - DBS Research 2020-02-28: Mutual Discharge Of Contract With Vendor

NETLINK NBN TRUST (SGX:CJLU) | SGinvestors.io NETLINK NBN TRUST (SGX:CJLU)

NetLink NBN Trust - Mutual Discharge Of Contract With Vendor

  • Expect to write-off S$15.4m of capitalised project costs.
  • No material impact on distribution in FY20F.
  • Continue to like NetLink Trust for earnings visibility and decent yield.
  • Maintain BUY, Target Price S$1.05.



Expect to write-off S$15.4m of capitalised project costs, no material impact on distribution in FY20F.

  • NetLink Trust (SGX:CJLU) has mutually discharged a project contract with its vendor, due to differences between the two parties. This contract is in relation to the design and implementation of a new generation business support systems and operation support systems. See NetLink Trust Announcements.
  • NetLink Trust expects S$15.4m of capitalised project costs (S$6.1m internal staff cost and S$9.3m third-party costs) to be written off. According to management, NetLink Trust will seek a replacement vendor at a similar or lower cost structure. As the capitalised project costs are non-cash, there is no material impact expected on NetLink Trust’s FY20F distributions.


Maintain BUY, Target Price of S$1.05; continue to like NLT for earnings visibility and decent yield.






Sachin MITTAL DBS Group Research | Rui Wen LIM DBS Research | https://www.dbsvickers.com/ 2020-02-28
SGX Stock Analyst Report BUY MAINTAIN BUY 1.050 SAME 1.050



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