Ladies and gentlemen, a very good morning to everyone joining both in person and on the web. Welcome to Sembcorp Industries' full year 2025 results presentation. My name is Xin Jin from Group Strategic Communications and Portfolio Management. Before we begin, may I request that all mobile phones be switched off or set to the silent mode. If you feel unwell at any point, please approach our staff for assistance. Joining us on the panel today are our Group CEO, Mr. Wong Kim Yin, and our Group CFO, Mr. Eugene Cheng. There will be a question and answer session following the presentation. Without further delay, I will now hand over to Kim Yin to begin the presentation. Kim Yin, please.
Thanks. Thanks, Jin. Good morning. A very happy Lunar New Year to everyone. Let me now quickly get into the results of 2025. Now, before I begin, I want to also set the stage. Compared to 2024, we have had those of you who have been following us would know that we have a significant headwind in 2025, right? The margins in Singapore has been under a lot of pressure with the increase in the supply in the Singapore market. That's the first one. In our U.K., you know, margins as well, volume also come under pressure. China renewables continue to face heavy curtailment as well as pricing pressure.
Despite those headwinds, we were able to offset the impact from those and came out in a resilient outcome, which is, you can call it flat, but it is not without effort that we can get to the SGD 1 billion mark. For consecutive years, we stay at that level, and that has given us that the confidence to come out and say that, "Hey, look, you know, the underlying cash flow and the business is strong and resilient, and actually the cash flow is growing." Because of that, we convinced the board to allow us to increase the dividend. It's just an indication. It's not much of an increase, SGD 0.02 out of SGD 0.25. It is still we recognize that we lack our peer group in terms of dividend payout, right?
Now that, again, we are operating at this SGD 1 billion platform, this new normal, that may not be new, it's been three years, but I think everybody is convinced that we have the underlying capability to increase our dividend, to close the gap between ourselves and our peer group, right? The idea is that in terms of returns, one can look forward to dividend. The second thing is that in terms of growth, you know, we show you that in the year we are pending the completion of a major acquisition in Australia, opening up a new market for growth, a new platform for growth, that is of scale, right? Returns and growth, that's the message.
If I want you to take away 2 message, please, those will be the 2 messages. Yeah. Let me then go through some of the details in 2025 performance. The turnover was SGD 5.8 billion, adjusted EBITDA SGD 2 billion, underlying net profit SGD 1 billion. You know, easy to remember, 6 to 1. You know, that's how I remember the minus around numbers. Underlying earnings per share, SGD 0.564. ROE 18.2%, right? As I mentioned just now, we propose a final dividend of SGD 0.16, bringing the total of the year to SGD 0.25. This is compared to 2024, the SGD 0.23 is a 9% increase.
Again, like I said, we recognize the gap in terms of payout ratio and dividend yield from our peer group. The idea, the intent, is that over time, you know, we're very comfortable and confident that we can close that gap. Into the business segments under Gas and Related Services, earnings of the group continue to be anchored by Gas and Related. Within the segment, the Singapore portfolio contributed SGD 538 million in net profit, or 77% of the GRS segment's net profit. A combination of long-term contracted portfolio, as well as the incremental contribution from Senoko Energy, provided the anchor for the earnings in 2025.
During the year, in the last year, we secured 370 MW of long-term contracts, of which 150 MW was from Micron, which we announced in January this year. We continue to execute this strategy to capture demand from data centers and high-tech manufacturing customers. As of February 2026, right now, close to 80% of Sembcorp's portfolio is contracted for five years and above. While the Senoko Energy's portfolio contracts are short-term. In 2026, just to go a bit further, 5% of the Sembcorp portfolio will have to be recontracted, while about 50% of Senoko Energy's portfolio must be recontracted. We expect that, of course, lower blended spark spread for the new contracted volumes, right? 50% of Senoko, 5% of the Sembcorp portfolio.
This impact will be partially offset by operational and financial synergies from both portfolios. In the fourth quarter of this year, 2026, the commissioning of the 600 megawatt hydrogen-ready power plant is expected to take place. It is highly efficient, and that will enhance our fuel and cost efficiency of the entire fleet. During the year 2025, we've also secured long-term PPA for Sembcorp Salalah Independent Water and Power Plant. This 10-year contract will commence from April 2027. The previous contract, which is currently running, is of a 15-year contract and will expire in April. We secure another 10 years, and that will provide the stability coming in from the contribution of Oman. The Middle East is entering a new phase of rising energy demand, driven by industrial and digital hubs that require reliable, uninterrupted power.
We have extensive experience operating critical power and water infrastructure in the region, and we will selectively pursue growth opportunities in the Middle East. Moving on to renewables. During the year, we maintained the pace of growth in the selected geographies, adding 3.6 GW of new capacity to our portfolio compared to the end of 2024. The earnings from the renewable segment increased 5% year-on-year. This is despite the contribution from China renewables declining to SGD 74 million from SGD 89 million in 2024. In India, we have seen improved contribution from the existing fleets as well as from newly commissioned megawatts. During the year, the pipeline continues to grow in renewables. We acquired 300 MW of solar capacity and secured 1.5 GW of greenfield winds, comprising hybrid projects, round-the-clock projects, firm and dispatchable renewable energy projects.
We are actively exploring capital recycling options in India. In the Middle East, we successfully entered the wind market in Oman with a 125 MW greenfield development project, underpinned by a 20-year PPA. In Singapore, we were awarded solar projects totaling 236 MW peak, including two floating solar projects, reinforcing our position as the country's leading floating solar energy player. In Southeast Asia, we completed the acquisition of the 49 MW hydro project in Vietnam and a 280 MW solar and energy storage portfolio in Indonesia, which is currently under construction. Our total group renewable capacity is now 20.4 GW, of which 5.4 GW are secured, either under construction or under advanced development. This 5.4 GW of new capacity will progressively come online between 2060 and 2030. Integrated Urban Solutions.
The net profit for the IUS segment was stable. Earnings from our water segment was stable, while contribution from the other divisions were lower, due to the absence of contribution from Sembwaste or SembEnviro. Obviously, we closed the deal to divest Sembwaste in, was it February? March 2025, so it's been some time. Compared to 2024, that the contribution from Sembwaste is, of course, no longer. The urban business continued to secure new industrial projects, bringing our total gross development land area to over 16,000 hectares. In Vietnam, we secured four new investment licenses, this brings the total number of projects in Vietnam to 22. In Indonesia, we are developing the 500 hectare Kendal Industrial Park Phase Two. Remember that phase one is almost is mature, most of the land has been sold.
Now we're moving on to phase two with 500 hectares. We are also progressing on the development of the 100-hectare Tembesi Innovation District in Batam. We have also doubled our leasable gross floor area to 1.1 million square meters, from half a million square meters in 2024. This and the occupancy rate of our operational industrial properties increased to 96%, from 76% as of the end of 2024. The in terms of both growth in square meters and also in terms of occupancy rate, the IUS team has done well to improve the performance. This will, particularly this area, will further strengthen our recurring income coming up from IUS.
We will continue to review and sharpen our portfolio, as we did through the sale of SembWaste and the divestment of municipal water business in China during the year. The long-term fundamentals of Sembcorp is very strong. We are in the right places. We have got secured cash flow through contracts with high-quality customers. Later, Eugene will show you the underlying cash flow coming from the Singapore portfolio, then post-completion, the Alinta portfolio is actually very, very robust. In the near term, we are facing some headwinds, which shouldn't be new. These are the things that we experienced in 2024. In 2025, or rather in 2025 and in 2026, we would want to flag that in front of you and give you a little bit more color what we would do about them.
In Singapore, with the new supply coming on stream, we can naturally expect the worst spot spreads. Since 2023, you know that we have been transforming our portfolio by leveraging our position as an integrated gas and power player, as well as the largest renewable player in Singapore, to secure long-term contracts. What was previously very merchant-heavy portfolio is now a largely contracted one. Of course, I'm speaking about the Sembcorp portfolio, not the Senoko Energy portfolio. Senoko Energy, we will go in there and try to add value as we did with our own portfolio. The good thing is that we got it at a price, at an investment level that is very comfortable, notwithstanding the merchant nature of the business, right?
As a portfolio, there are significant synergies in terms of financing, in terms of operations, in terms of, you know, how we run the plant. For instance, you know, we can sign a hedging contract with Senoko and to provide insurance, so that then we can aggressively contract our base load high efficiency units in the Sembcorp portfolio. There are significant synergies. We bought Senoko at a very attractive valuation. You know, in combination, we are now the largest fleet of gas-fired power stations in Singapore, together with our integrated gas portfolio and as well as our position as the largest renewable player. We are very well positioned.
we think that we are highly competitive. The diversified portfolio will position us to capture the growing AI demand in Singapore, particularly from data centers and high-tech manufacturing sectors. Let us go off script a little bit. When we say today, there's a lot of hype about AI, you know, shares, share price of some of these companies, tech companies are very high. we're not in that game. By the time the AI demand translates into energy demand, and it translates into a contract with Sembcorp, that is a solid demand. That demand for energy is coming from Micron, it's coming from data centers that are hyperscalers with good credit profile, right? we are sort of on the receiving end of it.
I'm not saying that we are AI company now, but by the time we receive the demand translated from all the noise in the market, it is actually a very, very solid demand that we are capturing, right? The important thing is that we are ready to capture it, and what we are saying here is that we are very well positioned to capture that demand. If I move on to China, of course, we will continue to face curtailment and tariff pressures, alongside with the recent cancellation of value-added tax refunds for onshore wind projects. These are developments that will affect the entire sector, not just us. Now, we will remain very disciplined in managing our portfolio exposure in China, in terms of thinking through project additions or even divestments.
We will allow time for expansion of transmission network and also pursue contracts to try to stabilize earnings. Having said all that, to put things into perspective, by now, if you look through the numbers, China is a relatively small contributor to the entire picture, right? As I mentioned just now, notwithstanding the headwinds and the lower contribution, and the reducing contribution in the last couple of years, we were able to plug the gap through other means. The last one is the UK. The closure of our key customers' operations, particularly SABIC, has driven largely by weak economics, of course, in the industrial sector, as well as in the UK in general. We are driving active cost management and repositioning the business to capture data center opportunities.
We'll talk a little bit more about why we think we can capture that in the next slide. I mentioned just now that we believe we're well positioned to support the region's accelerating AI-driven energy demand. Allow me to take a little bit of time to elaborate. Our Gas and Related Services provides reliable baseload energy. We are well positioned to capture more demand from new data centers, as well as the semiconductor sector. As we have shown you, we now supply almost 700 MW of the high-tech manufacturing sector, which includes also the recent 150 MW contract with Micron. Our renewable business delivers tailored green PPA solutions and long-term renewable energy supply for high-demand industries to meet their clean energy targets.
Contract secured include the supply of power-backed renewable energy certificates to day one, 20 megawatt data centers under 10-year PPA. Data center, day one, 20 megawatts to a 10-year contract. That sets the tone of what we can expect moving forward as more new data centers gets planted in the region, and particularly in Singapore. We've also signed a 25-year renewable energy purchase agreement with Meta Platforms, this is to build, own, and operate a 150 megawatt floating solar farm in Kranji. Finally, under the IUS business, we provide low carbon infrastructure to customers, we are able to develop sustainable data center infrastructure with partners to supply land and power, along with other green services. Within the Tembesi Innovation District in Batam, Indonesia, we can accommodate up to 100 megawatts of data center capacity.
For those of you who are familiar, Batam, of course, is already seeing the connection of fiber coming in from companies such as Intel. It is not whether there will be data centers, it is when and of what size, right? What we have there in Tembesi is a, is already, 100 hectares of land, ready to connect up to all this data center demand. In the UK, Wilton offers, 138 hectares of ready land with immediate grid connection and supporting infrastructure. That is naturally attractive for potential data center developments, right? Because as you know, for data centers, one of the biggest constraint is the power supply, right?
If you, in a place like UK or for that matter, Singapore, Australia, places like this, to bring a new substation and a high voltage cable to supply a newly increased demand from data center, that will take time. Existing infrastructure, existing land, will provide that opportunity. Together, in GRS, in renewables, as well as in IUS, Sembcorp is actually a very attractive, comprehensive energy and infrastructure partner for the AI players. By integrating reliable baseload, scalable renewables, and sustainable urban solutions, we want to capture the region's growth while enabling our customers to accelerate their decarbonization and digital transformation ambitions. I shall not go through this, and in the script that Gene has given me.
I think what I want to emphasize before I hand over to Eugene for the detailed numbers is, again, first, in terms of returns, we are expecting that we will be able to improve our dividend payout ratio and dividend yield steadily over the coming years. This year, the SGD 0.02 increase compared to 2024 is just an indication, and we have deliberately been quite prudent given that we are pending the closing of a major transaction in Australia, right? To close the gap in terms of dividend yield and payout ratio compared to our peer group. That is the first thing. The underlying cash flow, I have explained, where our balance sheet and cash flow positions when we discuss the Alinta acquisitions a month ago.
You know, if we need to provide elaboration again, I'm happy to do that later. Suffice to say, we're very comfortable with our balance sheet position. We have very strong cash flows coming in. In fact, you know, we struggle to find the type of growth opportunities like Alinta, where we can deploy the cash flow. Naturally, either you grow or you reward shareholders and return it to them in the form of dividends. That's the first thing. The second thing is that, in terms of growth, we have immediately in front of us, Alinta, which we will hopefully complete sooner than later, but certainly we expect within this year, if not the first half.
Alinta will provide, at least for the next few years, a significant scale market and a significant growth capabilities with a very strong management team now under to help us grow the entire energy portfolio. The least of it is a 10 gigawatt renewable pipeline that they have really identified, right? In addition to a very energy-starved, high demand growth, Australia energy market. Certainly in the next few years, in terms of returns and in terms of growth, we are quite set up for that. That's the picture that I want to leave with you before I hand over to Eugene. Eugene, please.
Excuse me. I'm glad to, as Kim Yin has highly pointed out earlier on, I think, 2025 was a year, the half year earnings announcement that we are seeing some headwinds. We were quite pleased that, you know, as we close 2025, we were still able to close the year strong, right? Keeping to the SGD 1 billion, you know, underlying our net profit earnings, you know, relative to 2024. On this slide is basically the, you know, the group level statistics, and I will talk through them.
I will use one particular slide which talks about the net profit, you know, of the different segments, right, to elaborate more in terms of the specific performance. If we look at headline from a turnover and EBITDA standpoint, we did see, you know, a commensurate, you know, 10% decline across the both of them. I think, from a, you know, we already know the key reasons for that, right? In general, in Singapore, we did see, you know, in general, lower spark spreads for the renewal contracts that took place towards the latter part of Q2. That also carried through for the rest of the year.
In addition to that, we also, you know, saw, you know, a high cost, you know, power import contract that continued to weigh us down. We did, you know, see, you know, some compression of, you know, gas margins. And also the absence of a, you know, roughly SGD 10 million-15 million of a gas upstream curtailment gain that we had in 2024 that was not present in 2025. In addition to that, we also, you know, saw, you know, weaker price and customer demand across UK in the UK Wilton gas business.
, we were, you know, hedge on contracted forward prices at the end of 2024, which was weaker relative to what was hedged for 2024 at the end of 2023. In addition, you know, we also saw the petrochemical sector, which, you know, is a significant part of the current, you know, customer base in Wilton that has seen weakening. So, you know, in general, customer demand has been weak as well. So we did see a weaker demand from the UK. Now, of course, we also were impacted by the loss of contribution, right, from assemblies after we have divested that in March of 2025.
This is partially offset by, you know, a new capacity that has been commissioned in renewables, right, across India, the Middle East, as well as, you know, Southeast Asia, where we completed the acquisition of the 49 MW of a hydro project in Vietnam. Of course, that is offset with by, you know, some curtailment issues that take place that continue, particularly in the Guangxi province of our control portfolio. The effect across the turnover and EBITDA. Share of results of associates and JV increased markedly by 57% or SGD 180 million.
Of course, this is driven by Senoko's full year contribution of 30% and an incremental 20% for half year. From a Senoko standpoint, this contribution is also offset by renewals of roughly, you know, 15%-20% of its contracted portfolio in the latter half of 2025. Just to give you a sense, you know, in those rounds of contracting, we essentially saw the recontracted spark spreads come off quite markedly, like we were contracting between $30-$35 spark spread for that renewal.
Which, you know, essentially came off, you know, highs of, you know, $70-$80, which were, you know, contracted more at the 23 period for them. Now, of course, I will touch on later on, because there continues to be, you know, recontracting taking place as Kim Yin highlighted through 2026. We also saw in the VSIP portfolio, we saw a higher contribution, right? Part of it as a result of a fair value against for the, you know, completed RBF projects, you know, within the VSIP parks that we own.
This is offset by some, you know, land sales weakness in Central Vietnam. The fair value contribution was SGD 27 million, but I'll talk about it later on, later. It's also offset by continued China curtailment in the SDSE portfolio. All in all, adjusted EBITDA, it's, you know, about 2% lower compared to FY 2024, SGD 2,016, compared to SGD 2,050. Our net profit before exceptional items and the DPNFX is SGD 1,003, relative to SGD 1,014. Now, we did realize a non-cash, you know, FX loss for the deferred payment note in 2025 of SGD 154 million, right?
This is roughly about coming simply from a roughly 10%-11% depreciation of the, you know, the INR relative to strengthening of SGD. When we compare the rate in which we mark-to-market or rather translate the DPN balance from INR to a SGD, the rate used in, you know, 2020 as of 31st December of 2024, was, you know, compared to the rate used at the 31st December of 2025. The rate declined, you know, roughly 10%-11%. Of course, this does not indicate, you know, any cash flow impact, but it's it's really a mark to market.
Now, as highlighted previously, hedging the balance of the deferred payment note, it's dependent on 2 factors. Number 1, the, you know, visibility of fixed cash flows. Now, the deferred payment note is largely on a, you know, a availability of cash, a sweep model, right? As a result, putting in place hard forward cashflow hedges, effectively from an accounting standpoint, will not result in a effective hedge, right? I think the second element also throughout 2025, when we look at what is the forward cost of hedging, the forward cashflow cost of hedging is, well, will result in a worse outcome than...
than, you know, the mark to market. If we do put on those hedges, it will be real cash outflows. You know, as a result of that, you know, we did not put in any form of, you know, forward contracts as a counterbalance against the rupee swings here. Nevertheless, SGD 154 million is really a one-time mark to market. It does not indicate any cash flow impact in the current cash flow generation capabilities of the portfolio. We have an exceptional items gain of SGD 135 million, that comes largely from the sale of SembWaste.
Also, you know, included in the sale of SembWaste in this, sorry, exceptional items was the, you know, a positive goodwill or bargain purchase option gain, you know, as a result of the second tranche completion of the, you know, Senoko transaction. This is offset by, you know, roughly, SGD 28 million, SGD 20 to 8 to 13 million of some asset impairments that we took across Southeast Asia, where we made a broader decision that, you know, we will not continue with the rooftop solar business, which generally is a very small part of Southeast Asia currently.
You know, all that results in the net profit from continuing operations, taking into account the DPN FX loss and the exceptional items of SGD 984, right. A lot of it is driven by the DPN FX impact. Our ROE from a more underlying basis, right, before exceptional items and our DPN FX loss is 18.2% relative to 20% last year. There are some, you know, capital drawdowns that took place in 2025, particularly in relation to CCP4 and also continued capital deployment for our pipeline and also certain projects that came online but were not contributing on a full year.
I will illustrate what the effects are, those, from a normalized basis, on the slide later. I won't touch so much on the broad group turnover, because, you know, the reasons are largely about, was, what I've highlighted early on. I want to move on to the next slide, which illustrates the group and net profit by segment. For the Gas and Related Services, you know, we turned in 701, which is, you know, a 4% decline, relative to 728 in FY 2024. As Kim Yin has shared in the earlier slide, the effects can be broken, largely into 2, right?
For the Singapore, you know, Gas and Related Services portfolio, FY 2025 turned in SGD 538 million, relative to SGD 546 million in FY 2024. These numbers are there. It is just in Kim Yin's earlier slides, okay? That is a, you know, approximately an SGD 8 million decline. There are basically two effects here, right? One, contribution from Senoko, and the other one, which is, you know, the continued margin pressures that we see in our Singapore-only portfolio.
I think, you know, throughout, you know, 2025, as highlighted in the first half results, we did see roughly a 10% of our portfolio recontracting 90-100 MW from the Sembcorp portfolio that took place at that point in time. We did see, you know, spot spreads coming off down to, you know, the $30 range, which was coming down from the high of the $80-$100 range that was previously contracted. That carried through the full year. And the impact from the, you know, the declining spot spread was about $60 million-$70 million on a full year basis.
We also saw the, you know, the high cost, you know, power import contract that we signed and disclosed at the end of December 2024. The run rate impact in the first half carried through for the full year as well. In the first half, we highlighted was about SGD 20 million or so. That continued to weigh down on the portfolio. We also saw, you know, some declining gas margins, and also, in addition to that, there was a one off or curtailment compensation gain in 2024, around about SGD 15-20 million. That wasn't there in 2025.
These are the impacts on the ex Senoko portfolio. I think from the Senoko compensation, you know, largely across the Gas and Related Services adjusted EBITDA disclosure, you will be able to, you know, largely look at that number. Again, as highlighted early on, we do have to bear in mind that in Senoko's 2025 numbers, particularly in the second half, it has been impacted by roughly 20% of the portfolio that has been recontracted. They have been recontracted at $30-$35 spark spreads as well, right? You know, that has come off, you know, similar high levels of about $70-$80 as spark spread that was contracted before.
As Kim Yin has highlighted in the pie chart earlier on, we expect to see close to 50%, roughly 47% of the Senoko portfolio that will be recontracting, you know, from the second half onwards. All in all, you know, we do have, we believe, based on our visibility right now, those recontracting levels will largely be at a $30-$35 level as well, coming off, you know, similar highs as highlighted. That's, you know, the visibility that we have on the Senoko earnings. On the rest of the world earnings, you know, We turned in SGD 163 million, right?
Relative to SGD 182 million for the Gas and Related Services segment. That's about SGD 20 million, SGD 19 million-SGD 20 million decline. The rest of the world gas earnings were historically largely very stable, but I think this year we saw a SGD 20 million decline, largely as a result of UK. As highlighted earlier on, you know, UK did see two effects that came through. Number 1, you know, basically lower, you know, power prices. Secondly, you know, lower customer demand as well, particularly the petrochemical customers in the UK. One of them, Savic, did not return.
you know, for its olefins plant and we do expect the weak customer demand potentially to carry through into 2026. That's for the Gas and Related Services segment. For the renewables segment, from a net profit standpoint, right, we turned in SGD 192 million, which is 5% higher than SGD 183 million, which we are close FY 2024 with. Again, you know, earlier on, we have broken up this segment into a China as well as others. Let's talk a little bit about China. For China itself, in FY 2025, we turned in a SGD 74 million net profit versus SGD 89 million in 2024. It's a SGD 15 million decline.
There are two key effects to that change in net income. Firstly, it is continued curtailment that affect the China portfolio, particularly in the northwestern side of the portfolio. I mean, to give you a sense on the average China curtailment that we have across our portfolio, in FY 2025, our average curtailment for the wind portion of the China portfolio was 14% versus 8% in 2024. It's a very significant increase in the curtailment. And for the solar portfolio, it was 16% average of curtailment in 2025, relative to 9% in 2024. Also, you know, commensurate increase in the level of curtailment.
The impact of a curtailment on the China portfolio in the FY 2025 was approximately SGD 30 million in net income. Okay. We did see, you know, a capacity increase in the 2025, right? By, you know, from, you know, project pipelines that were coming through. Gross capacity, we added about 900 megawatts, right? The increase, the capacity increase, plus also some stronger generation that we see, right, in our hydro portfolio on the wind generation, did result in a SGD 15 million positive net income on a year-on-year basis.
The net effect of both, right, curtailment, negative SGD 30 million, but we did have some, you know, 9 megawatts of capacity increase and stronger wind generation in the high wind portfolio. That resulted in a net SGD 15 million downside in our China renewables earnings. In the others portfolio, which comprises of India, Middle East, as well as Southeast Asia, we saw in 2025, we did SGD 118 million relative to SGD 94 million in FY 2024. That's a SGD 24 million increase. This is largely driven by 2 things, right? We did see, you know, a new capacity commissioning across India, Middle East, and also we completed a couple of acquisitions, right?
You know, one which is the 300 MW renewable portfolio, and also, you know, the 49 MW Vietnam hydro portfolio. Those were later in the year and did not contribute on a full year basis. All in all, you know, that contributed to that increase. I think in addition, also, we did see a slightly better wind resource of performance across India as well. That contributed to the, you know, renewables portfolio outside of China, that I saw a SGD 24 million increase.
If we move to the Integrated Urban Solutions, right, it is flattish across both from 2025 compared to 2024, SGD 178 million compared to SGD 173 million. When we break across the three segments in Kim Yin's earlier slide, right? The urban business turning SGD 114 million relative to SGD 101 million in 2026. It's about SGD 13 million increase. Okay. The increase was really driven by about SGD 27 million of a fair value against, as a result of the ready built factories and warehouses that are, you know, being commissioned.
But this is offset by some land sale weakness in central Vietnam. As you will recall, one of the areas that we have been very vigilant since the Liberation Day tariffs were announced, was central Vietnam, where the manufacturing activities of our customers tend to be of lower value-added variety, right? You know, we all know that central Vietnam in Vietnam itself, basically, from a labor perspective, they are of a lower level. So, we did see a weakness in that segment as well.
You know, across the northern as well as the southern part of Vietnam, we continue to see, you know, land sales to be strong, and also across Indonesia. I think Kim Yin brought up an important point. The coming through of the ready-built factories and ready-built warehouses did also increase our recurring income contribution in the urban business. In 2025, our recurring income contribution across infrastructure charges in the parks, as well as the ready-built factories, is approximately 20%, right? Net profit contribution from recurring income. This has increased markedly, compared to about 10%-12%, which three to four years ago.
The, you know, coming through of the ready-built factories has, you know, improved the recurring income quality within the urban portfolio. As high highlighted also by Kim Yin, going into 2026 and 2027, going into 2028, we will have a significant amount of, you know, ready-built factory and ready-built warehouses to be constructed, right? Once that is done, we would see even stronger recurring income contribution to urban. In the water business, right, we turned in SGD 52 million relative to SGD 50 million in 2026, so fairly stable, right?
We did see, you know, cost optimization efforts in 2025 that turned into fruition, approximately a SGD 2 million, you know, of cost optimization gains that, hopefully, would stay as runway going forward. One point to note also in 2025, we did receive a one-off SGD 10 million receivable settlement for a past, you know, a receivable in relation to one of our not so well-performing municipal asset, Qinzhou. In 2024, we also have similar levels of, you know, one-off gains, right? That was across, you know, Fuzhou and another water plant compensation collection recoveries of past receivables, as well as certain provision reversals.
The last element to talk about in IUS is really our waste and our waste-to-energy business. We did see a decline of SGD 10 million. This is largely contributed from the divestment of the same waste business, which took place in March of 2025. If we move one further down the line into the Decarbonisation Solutions segment.
While we turn in, you know, a -23, relative to -20 in FY 2024, one of the key elements, you know, of that SGD 3 million increase in terms of losses, is a result of a write-off of, you know, a write-down of our RECs inventory value in our GoNetZero. I think in 2025, we have seen a marked decline in the value of the RECs. We took off a meaningful write-off, and that contributed to the increase in the losses. In other businesses, you know, we turned in SGD 45 million relative to SGD 38 million in FY 2024.
Other businesses, it largely comprises our Sembcorp Specialised Construction, as well as the mint business. The mint business continues to contribute $1 million-$2 million of net profit. It remains flat. Our Sembcorp construction business continue to accelerate in net income realization, simply because of a growing order book. Order book for the Sembcorp construction business is in excess of $1 billion currently. Going further down the line, from a corporate cost perspective. For interest cost, we were able to optimize that by about $10 million, largely, and this is a corporate level of interest cost.
We were able to do that because, you know, we did take efforts to, you know, optimize, you know, our cash usage to minimize negative carry. I think in addition to that, also, we benefited from refinancing activities that, you know, were at a lower interest cost. We were also quite active in, you know, looking to really rework some of our, you know, commitment fees, for example, you know, with our banking partners, and this resulted in a, you know, reduction in our interest costs. Our other, you know, corporate costs reduced by SGD 25 million.
To give a greater clarity of that, SGD 11 million of that, on a year-over-year basis, came as a result of, you know, a past tax provision reversals. That is in relation to a withholding tax provision that we made against a China dividend that was paid out, right? You know, the withholding tax and provisions has gone past time bar, right? The time bar, and hence, you know, it was okay for us to release the provisions. The SGD 14 million of the SGD 25 million came through discretionary cost savings. We were managing costs across, you know, professional fees, across travel, across, you know, manpower costs throughout the year.
Uh, you know, and, uh, and that allow us to realize the cost. Now, going forward, because these are, uh, uh, cost management, uh, uh, uh, efforts, uh, against discretionary costs, uh, you know, we will continue with those efforts in uh, twenty twenty-six. But, uh, you know, we may not be able to realize the same magnitude of a cost savings, but, uh, you know, we will continue to be, uh, driving, uh, cost savings at the corporate level, uh, uh, uh, in those areas. Now, for the DPN, uh, income, that has come off, uh, twenty-five million, hundred and fifty-nine, uh, down to one one nine.
I think, you know, that simply is a result of, you know, continued pay down of the, you know, the debt balance, you know, in Indian Rupee terms, you know, of the deferred payment note. I think, one of the key things to highlight is, you know, the cash flows, as well as the earnings performance of the underlying asset, which is SEIL, the coal plant, continues to be very strong, right. People, I may not have highlighted this enough, but, since the transaction, incepted in January of 2023, right, until today, total cash collected across both our income as well as principal paydown in Sing Dollar terms, is in excess of SGD 1 billion. Right.
It's about SGD 1.05 billion, right? You know, looking into 2026, we do expect a continue a similar strong, you know, cash flows return and pay down of the deferred payment note income as a result of SCIL's underlying performance. Of course, that will also mean that our DPN income will continue to decline as we, you know, see a faster recovery of the principal. I think essentially, that largely, you know, highlights the, you know, the difference differential of performance across all the segments.
The DPN FX gain loss and the exceptional items I touched on early on, I won't, you know, go into more detail. Move on to the next slide. This is basically a bridge that highlights what I was talking about, I won't talk through this slide again. In terms of the group ROE, as highlighted early on, we did see a decline in the group ROE. Gas and Related Services was 32.1% in FY 2024, down to 26.4%. In the ROEs itself, there are two effects. I think that firstly, it is the declining spreads as we are talking about.
The second element also is we are incurring CapEx and drawing on capital particularly for CCP4, right? In 2025 was a year where we incurred the larger amount of CapEx coming into 2026, where, you know, we expect, you know, a CCP4 commissioning to take place towards the end of the year. Normalizing for that, you know, the ROEs would have been better. Now, for renewables, it's 7.4 relative to 8%. Two effects, one of the elements is we continue to see curtailment elements weigh down the China portfolio. We have projects that are commissioned that have not contributed on a full year.
I will show the normalization of the effects on the next slide. The Integrated Urban Solutions continue to be at 8.4%. If you move to the next slide. If we look at the ROE, as highlighted, we do want to call out, you know, what are the capital draw that has potentially weighed down the ROE versus what it would have been on a normalized basis across the renewables as well as the group. For renewables, we did have a 0.7% that comes from, you know, a combination of projects that were commissioned in 2025, that did not contribute on a full year basis, right?
If those projects contributed on a full year basis, it would have been an additional 0.7%. We also have, you know, certain projects in the pipeline that are under development and have drawn down on, you know, CapEx, right? And have not COD'd yet. The impact of that is about another 0.2% on ROE. The normalized renewables ROE would have been about 8.3%.
From a group perspective, on a similar basis, the contribution from projects that were commissioned in 2025, that, if they contributed on a full year basis, that would have been a 0.3% impact, and projects that are under development would have been a 1.8%. That looks a lot larger relative to renewables, because the biggest part of that is, you know, the CapEx that is drawn for CCP4 construction, which is expected to be commissioned in the later part of the year. If you move on to the next slide. This is to highlight the impact, the translation impact, of the strong Sing Dollar across the different currencies had on our earnings.
As you will recall, I highlighted this in the first half because, you know, from the first half, we have seen a, you know, a almost systemic, you know, strengthening of the Sing dollar against, you know, all our key functional currency exposure. Just for us to note, this translation, in fact, is simply, you know, for each of our, you know, overseas operations, the accounts are kept in local functional currencies, and when we translate back into Sing dollars, we would have to use an average translation rate, and that translation rate have a decline, right?
Operationally, in the respective, you know, markets, you know, certainly, you know, it's not indication of, you know, the operational earning capabilities in those markets. Cumulatively, across 2025 compared to 2024, right, the estimated impact of on, you know, the translation impact on our earnings has been about SGD 32 million, so it's fairly significant, right? Almost, you know, 3% to 3.2% of, you know, underlying earnings. This continued heightened currency volatility, we will monitor the situation, but given that this is a translation impact, you know, traditional hedging activities may not be that effective.
If you move on to the next slide. This is really our CapEx and equity investments for FY 2025. In short, you know, total investments that we have made in 2025, total about SGD 1.2 billion, right? Relative to, you know, close to SGD 2 billion in 2024. If you move to the next slide. Our cash flow generation continues to be strong, right? In 2025, our, you know, cash flow, operational cash flows is about SGD 1.2 billion, slightly down from SGD 1.4 billion the year before.
Taking into account, you know, cash flows from essentially interest income as well as dividends, and the DPN receipts. You know, our free cash flow before you know deployment for expansion CapEx as well as equity investments, so SGD 2.1 billion relative to SGD 1.8 billion of last year. Of course, in the SGD 2.1 billion, we have the benefit of SGD 383 million, which is the net cash proceeds realized from the Sembcorp sale, okay?
Even if you take that out from the free cash flow of SGD 2.1 billion, our free cash flow available for debt service as well as growth on an annual basis, still remains approximately SGD 1.7 billion, which is similar to FY 2024, the year before. Highlighting, you know, our confidence that we can, you know, service any outlook in relation to our dividends going forward. In terms of our group borrowings, from a gross debt perspective, we saw roughly about SGD 200 million plus SGD 300 million in increase.
That result as a continued drawdown of the completion of our pipeline and also CCP4, also because of our overall net, stronger net cash flow of generation, our net debt remains fairly similar to last year at roughly SGD 7.8 billion, with our cash and cash equivalents increasing from SGD 871 million to SGD 1.1 billion. Our key leverage metric, which we always focus on, our net debt to adjusted EBITDA, right, stands at a 3.9 times, which is not very different from where we were 1 year ago. Moving on to the next slide. From a group debt profile perspective, we improved it slightly this year, right?
In some of our refinancing activities, where we were able to benefit from lower base rates, tighter margins and also an extension in terms of tenor. We were able to refinance some of our, for example, a 5-7-year bank of revolving credit facilities towards the 8-year mark. Also, we were able to issue a 2.5-year bond at 3.55% in October of last year. All this resulted in our weighted average cost of debt declining slightly from 4.6% in 2024, to 4.5% in 2025, while being able to extend our weighted average debt maturity to 5.2 years.
In terms of our fixed versus floating profile, 76% of our portfolio remains, you know, fixed, which means that on a floating perspective, you know, every 1% change in a base rate will be about SGD 50-16 million dollar impact. Of course, we are mindful that given the current interest rate environment, it's on average a more towards a downward bias. We will also be monitoring our fixed and floating rate mix, taking that into account as we go through the year. From our available liquidity, we remain strong, right?
The key thing that we always focus on in what is our on-demand liquidity, which is really a combination of our cash and cash equivalents and our unutilized committed facilities. As of today, you know, our cash and cash equivalent stands at SGD 1.1 billion, and our unutilized committed facilities is at SGD 2.5 billion. Total, about SGD 3.6 billion of, you know, on-demand liquidity that will, you know, allow us to take advantage of any growth opportunities that come through. The next slide is just to highlight the outlook, right? Essentially, you know, we have delivered resilient financial results, right?
Reflecting the strength of our diversified portfolio and cost management, right? We do have long-term contracts across our portfolio, by increasing the proposed dividend in 2025 reflects our belief in the strength of our underlying earnings and also cash flow visibility. When we go through the different segments, I think in 2026, as highlighted before, right, the Gas and Related Services segment, what is still expected to be affected by, you know, gliding down of our spot spreads, right, and margins. You know, we do, as guided before, roughly 3-5% of our own portfolio, will be subjected to summary contracting in 2026, and approximately 47% or 50%, right, approximately half of Senoko's portfolio will be recontracted.
Coming into 2026, you will, especially for Senoko, you would expect to see, you know, a full year impact of the recontracting that took place in the second half of 2026, roughly 20% of the portfolio. You know, 50% of Senoko Energy's portfolio that will be recontracted starting from the second from the middle of the year onwards. That is something to take note. Of course, we would expect that effect to be partially offset by operational and financial synergies across the two portfolios, and also the, where the H-class is, you know, a commission.
We do expect to see a greater fuel and operational cost efficiency as a result of running that hard against the portfolio first. This highly competitive portfolio will position us well to continue to capture incremental contracts because of the power, growing power demand, driven by data centers and high-tech manufacturing sectors. As we have demonstrated since 2023, having a, you know, leading track record in being able to do that consistently again and again. For our renewables portfolio, we do expect our platforms across India.
Wait, please come back, Dr. Booth.
...Wow, okay. I didn't know, I hope I didn't say something that, you know, was that earth-shattering. What I meant to say was that in renewables, our expanding platforms across India, Middle East, and Singapore will continue to grow, right? That's a good thing. You know, with the new capacity progressively coming in, you know, 2026 across until 2030. Having said that, you know, for China, we continue to be very watchful. We do expect, you know, curtailment, you know, to persist, right? There's one other regulatory development that we would wanna highlight.
China has come up with a policy where they said that value-added tax refunds for onshore power wind projects, they're gonna stop it, right? That applies retroactively as well to projects that have already been commissioned. That policy change will see a SGD 12 million impact, a further impact on the China portfolio in 2026. For the IUS business, you know, the urban business, I think one point to highlight is that we are going into a phase in 2026 and in going into 2027, right? Where we would be developing close to 800,000 square meters of ready-built factories.
Of course, you know, these ready-built factories across 2026 and 2027, will not be generating incremental recurring income. You know, we would expect to see some pre-operating as well as the financing costs for them. But once they are GOP towards the end of 2027 and going into 2028, there will be a meaningful increase in contribution of recurring income to the urban portfolio. All of this put us in a good state to navigate our near-term headwinds. You know, we expect the Alinta acquisition to be completed, you know, you know, in the first half of 2026.
That acquisition, completion of the acquisition will further strengthen our earnings base, our recurring cash flow, and our ability to sustain and potentially grow our dividends over time. Okay? A couple more, you know, developments to note. When we complete Alinta, we have already highlighted this, you know, in the circular to shareholders as well as in our briefings, right? We do expect a one-off, you know, transaction cost of close to AUD 208 million. This will be called out in exceptional items, right?
The bulk of that, two, more than 50% of that SGD 208 million are really in relation to our stamp duties, you know, for the ownership transfer. Okay. You know, in UK, we have a 4-week maintenance at Wilton Ten, right, towards the middle of 2026. It will not be a very material earnings impact, SGD 5 million-SGD 10 million. Okay. That ends my presentation, and we can open up for Q&A.
Thank you, Kim Yin and Eugene. We'll now proceed to the Q&A session. For those in the room, you can raise your hand, and a microphone will be handed to you. Please state your name and the organization that you represent. Just for those online as well, you can enter your questions in the Q&A box by clicking on the Raise Hand icon on the webcast page, and we will address them during the session. Yeah, we'll start with those on the floor. Maybe Zhi Wei first. Yeah.
Hi, Zhi Wei from Macquarie. Thank you for your presentation. I have. Well, let's start with 2 questions first. First, China renewables, right? It's been 3 years, and the curtailment issue has not improved. I think about a year ago, you said that, you know, the curtailment issue would maybe hit about, you know, 1% of your earnings, but it seems like if I heard correctly, about SGD 30 million delta, and it's like, yeah, for this year. It's coming up to almost 3%. How are you thinking about the entire business if things do not continue to deteriorate, right? What are sort of your thinking around how to mitigate this risk further?
From your point of view, where do you see us, you know, sitting in this entire down cycle for China renewables? Are we at the bottom or near the bottom, and can we when, roughly, just, you know, your sense, when do things see things will improve? The second question is on the Gas and Related Services for Singapore. You mentioned a decline in your gas margin. Can you run us through with a bit more color on what changed, right? Because this is a pretty significant contributor to your bottom line profit. How big was the year-on-year decline in the gas trading business, and how do you see the margins change going forward?
If I remember correctly, this used to be a high single-digit business, a gross margin business, you moved it into a mid-teens, where do you see it go now? Thank you.
Can I ask Alex to deal with the China question? Renewable East CEO, President is here.
Hello, can you hear me?
Hey, thanks, Zhi Wei, for the question. I cannot say for sure whether China has reached the bottom in terms of the curtailment, but let me offer some insights directionally, where the government is going. What's really caused the curtailment, as we all know, is the search in renewable installed capacity, right? A lot of new projects. Just to give people some perspective, when we first started the journey in 2021, the renewable solar and wind, onshore wind, was growing roughly about 120 GW a year. 2021, 2022, was roughly about 120 GW. What happened was, in 2023, we saw a surge in the renewable capacity to roughly about 300. Just to give you some perspective, 300 GW a year, 2023, 2024, right?
In 2025, because of a change in policy, everybody was rushing to get their projects online by the middle of 2025 to make sure that they enjoy the existing policies. Because of that, there was a mad rush, and the capacity actually surged and increased to roughly about 400 GW a year, just to give you some perspective. What's gonna happen is this: I think we have to look at this from three perspectives. One is demand, second, supply, and then what is the government doing in terms of making the grid more resilient so that the grid is able to absorb all the additional capacity?
In terms of demand, as we all know, China continues to see a very strong power demand, roughly about 5%-6% a year, driven by electrification, EVs, and AI, right? That's 1. Demand continues to be very strong. On the supply side, there is a new government policy that states by 2035, renewables is going to get to 3,600 gigawatts, which basically translates into every year from now until 2035, renewables will slow down to roughly about 180 gigawatts a year. Which I think will give the industry a bit of relief, right? From the 300-400 gigawatts a year of growth today, to roughly about 180 gigawatts. 180 gigawatts is still a big number, but in...
If you look at it, China has a big base right now. You know, I think 180 gigawatts is not a bad number in terms of where the government is taking this directionally. The third is, what is the government doing in terms of making the grid infrastructure more resilient, which is essentially the, one of the issues, to move the electrons from the west to the east. The government is going to pour in 4 trillion RMB, which is roughly about 700 billion SGD, over the next 5 years. That's a lot of money, right?
That investment would include things like transmission lines, which is important because they got to move the electrons from the west to the east, which is essentially one of the biggest problems that China is facing today. Second thing is, they will also put money in transformers and, you know, all kinds of nuts and bolts to make the grid infrastructure more resilient. Last, but not least, is there is also. We are catching up, right? There's also another new policy in November of 2025 that encourages data centers to be built in the northwest, right? I think that's also important because the additional power demand in the west is going to absorb the additional power supply.
Again, just to get everybody on the same page, demand is gonna continue to be strong, 5%-6%, driven by electrification and AI. Supply will slow down based on new policy to roughly about 180 gigawatts a year, until 2035. The third is the government is gonna pour in, roughly about SGD 700 billion, on the grid infrastructure. The last one is the latest news in November, which is encouragement of data centers to be built in the west.
Zhi Wei, to first put into perspective, of course, the 30 million, a good part of it, Eugene was just telling me between a quarter to a third, is actually new. It's coming from Guangxi, that one is because they've got a lot of hydro, heavy rainfall. That might not repeat, right? The rest of it is coming from the northwest, largely. Yeah. The northwest, that's the part that's subject to the transmission, subject to the new demand coming. Anybody's guess, right? If you ask me whether it has hit the bottom, maybe. How much longer it will last, I... For our planning purposes, we are saying that for 2026, we are not counting on it to flip around, right? Hopefully, for the near term, that puts additional color to it.
You take another step back. For us, it has gotten to this point where it is, you know, earlier, China portfolio is supposed to be contributing with SGD 120 million-SGD 130 million, you know, just from the renewables. It's at SGD 80 million.
It could get worse. It's always possible, but it is quite beaten down already. For us, we are planning, we are not counting on it recovering in the coming year, right? We, we'll have to see. In the meantime, your other part of the question, what are we doing, right? Of course, cut costs. We are looking at other forms of managing exposure. For instance, growth has also been very, very calibrated, disciplined, selective. Those are the words, you don't see the type of growth anymore coming. We are also thinking about whether or not we could manage exposure through perhaps bringing partners, looking at the capital structure, that type of thing, right? I'm not promising anything.
We're saying that we, with the outlook, as I described just now, we're not expecting anything to change, for at least another 12, 18, 24 months, you should be doing things in the meantime, right? That's what I want to suggest to you, without having anything concrete to show you yet. The plowing with that type of outlook, naturally the management action must come in. That's on the renewables. The gas, maybe, Eugene, I think the gas margin, we, you very astute of you to point that out. I think, for 2025, when we look across the gas, number one, we have the one time, you know, upstream or curtailment gain.
That was about SGD 10 million-SGD 15 million. Outside of that, from a gas margin standpoint, we probably saw a SGD 25 million-SGD 30 million downside impact. Okay? What has changed? I think the periods where you saw a high double digits, actually higher than double digits, you know, gas margins. You know, if you, if you are looking at the, you know, the SGD financials, which I know you always do, right? Thank you for spending the money for, to do that. Those periods obviously are periods where there is volatility in the index, right?
When there's a volatility in the index, it gives our gas, I don't want to use the word trading, but our gas business, the opportunity to, you know, to, I think arbitrage is the right word. To basically look at opportunities to diverse gas and optimize gas cargo, right? To have a larger amount of gas optimization earnings on top of what is contracted.
Of course, when you see that going through 2024 is still fairly volatile. When you come back into 2025, you know, we are essentially seeing more stability between the, you know, the JKM index and also across the, you know, the Brent index of which our long-term prices were. Because of there is a lack of volatility, so our ability to drive, you know, the same level of a gas optimization or arbitrage gains, right, is less, right. The good news is that, you know, I think across 2025, we have been monitoring, you know, the gas margins in the first half, second half, it has been stable.
Going forward, we don't expect, you know, the gas margins to be similarly impacted because it is trending more towards, you know, our base, contracted level of gas margins. We are not at single digit gas margins. We are actually still at the low double digit gas margins. Yeah.
It's still we're asking about the spark spread in the power side?
No.
You're talking about gas.
You're talking about exactly what I'm saying, right?
Sorry. Thank you for the answer. Just 1 follow-up. Coming back to China renewables, right? If your curtailment stays at this low teens number for the next 1, 2 years, and let's say things do not deteriorate further, do I have to worry about impairment of the China renewable asset base? If not, at what point do I start to sit up and pay attention?
Okay. I think so in relation to our China asset base, we have always do very detailed impairment analysis, right. I think where we stand right now, right, we do not see the need for any impairment because from a policy standpoint, right, the and, Alex, you can help me to elaborate more, that, you know, the Chinese government have made a very strong stance that they will build the, you know, the northwest connect interconnection lines, you know, across to the to the, you know, eastern side of things.
The exposure for us for the very high curtailment, like I pointed out earlier on, it is really across the SDIC portfolio, okay. Because that has a significant exposure to the northwestern side of things. Also, you know, some of our Guangxi assets. Of course, you know, with that, you know, we are confident, you know, that within a certain level of visibility, the curtailment situation will abate as, you know, these interconnector lines are built out. The question is really about how long? Of course, we do stress test, you know, the outcome of our assets.
You know, the curtailment situation will have to persist for rather long, and I'm talking about many, many, many years kind of long, right? Before you even worry about curtailment. More specifically on the SDIC portfolio, if you will recall, you know, that is essentially one of our higher returning portfolio, right? Where we entered in at 1.8 gigawatts, organically, it grew to more than double in terms of capacity. When we look at, you know, our cost of investment for the SDIC portfolio, based on our analysis right now, it is very unlikely that it will hit any form of impairment, simply because, you know, our cost of investments. Just to isolate, you know, those are the two key acumen.
I know, Alex, do you highlight it on the ninth? Okay. Yeah. Okay. The gentleman in front.
Nikhil, please.
Hi, this is Nikhil Bhandari from Goldman Sachs. Just sticking to renewables, but shifting from China to India renewable. When we look at the overall over 5 GW under construction or secured portfolio, India is a big chunk of that. It appears that there isn't a lot of completion of projects happening in calendar 2026. It seems to be more heavy on 2027, 2028, 2030. Out of all of that portfolio in India, what percentage has already the PPAs signed? What % already has the exit connectivity already secured? If you can help provide some color on that.
Okay.
That's the first question.
Okay. renewable President CEO West. use this. Yeah. Vipul is in the best position to answer this.
Hi, thanks for the question. I think maybe to start with the second part of your question first. Of the roughly 2.5 gigs of pipeline, about half have PPAs signed, about 1.2, and about half are at the LOA stage, where we are discussing with the various REIA and the DISCOMs. As you might be aware, I'm sure, a few months ago, there was a push by the central government to try and clear that backlog.
That has had the effect because the PPAs, all the REIA then went around and said, "Okay, let's take a closer look at each of these LOAs." There are active discussions going on, typically between generators like us, REIA, like SECI or SJVN, and the DISCOMs who would be the offtakers. Fortunately, the with declines in equipment prices since the time that these PPAs were entered into, most generators, including us, are in a position to offer more tailored offerings within the same tariff range to the DISCOMs. Those discussions are proceeding, and of course, we'll, as and when we sign the PPAs, we'll make the necessary disclosures. About half and half on the, on the first one. Your observation on the pipeline is absolutely right.
The way we look at it is that there will likely be some of our projects that are at advanced stage of construction will get completed in 2026. The bulk of the pipeline will indeed be 2027, 2028, thereafter, largely constrained by grid capacity availability or connectivity availability. These estimates that we do are after we take into account whatever grid delays, and happy to have a deeper discussion on that. What we are seeing is considerable all of government effort across the central government, the state governments, the local governments, to try and debottleneck the grids.
In fact, if you look at the Electricity Act amendments that are now proposed, which are widely circulated in the public domain, special powers to governments to acquire land and get grid done have also been included there. I think coming back to the effect on us, the way we look at it is, it actually gives us a little bit of that respite to make sure that land acquisition, which is usually one of the bottlenecks for any renewable power development, we actually get much more time to do our land acquisition. Be very true to our intent, which is to have 100% land acquired before we break ground. That is now what we are seeing in the projects that are coming forward.
Actually, what ends up happening is, say, for a solar project, even a large one, let's say 4, 500 megawatts, the actual construction time is rarely more than 1 year, or at most, 1 year and a half, whereas the total elapsed time may be 2, 3 years, maybe even sometimes a bit more. Actually, what we get is good enough time to get the land done, get the engineering done perfectly, get the EPC done perfectly, and then move on from there.
Is it fair to say the projects we have until 2028 commissioning estimate, has most of the land and the connectivity already secured, or?
Connectivity is 100% secured. In fact, we have connectivity available for which we are yet to conclude PPAs. That part is clear. Land, very, very advanced. We are now, I would say, very vast majority of land already done, and the rest is, will be done before we break ground.
Another question, just sticking to India renewable business. We heard, a lot of news flow around some, renewable power curtailment in India.
last year, especially concentrated in Rajasthan, Gujarat area. We also started hearing some of the newer PPAs being signed, have some curtailment clauses in it, up to 100 or 170 hours in one of the PPA, which is in the public domain signed. I'm asking this question because coincidentally, maybe, India has also hit nearly 50% of the power capacity mix as renewables and hydro, with China hit that number probably 3 to 4 years ago, and there was a beginning of a curtailment phase in China. How do we think about the risk of grid absorption, curtailment risk in India, given the system is so heavy now on renewable and the, and some of the weather-related, power generation?
No, thanks. That's also a very germane issue. For us, in India, it works a little bit differently. The curtailment that has been talked about in the press and is part of a lot of concern for many people, is basically when projects connect to the grid on a temporary connectivity. We call it T-GNA. When you have temporary connectivity, the grid's obligation is to give these projects connectivity on a best effort basis, all bets are off as far as curtailment is concerned. The moment there is any sort of congestion, those get backed down. Our projects are all on permanent connectivity. The moment you have permanent connectivity, any commercial backdown due to congestion or due to commercial reasons like demand, is recoverable by the generator.
The only reason that grid curtailment can happen as per the PPAs, once you have a permanent connectivity, is when there is a specific grid security issue, which typically will not occur for more than a very, very short period, typically, you know, a few hours here or an hour there. The numbers that are being floated around in the press have nothing to do with our portfolio. If I look at our Rajasthan portfolio, I don't think we've actually disclosed these numbers, but I think it's fair to say our curtailment on that, including what we will recover back, part of which we'll recover back, is below 1% at the moment, and that, too, a large part will come back.
Just combining previous China-related questions and the questions related to India. Given China, we still expect some more deceleration in the earnings this year, and given there are more limited new project completions in calendar 2026, should we assume any growth in the renewable business earnings in calendar 2026? Also, while we don't, we don't assess any impairment risk right now, but can we quantify, like what % of our receivables, for example, are related to the China renewable business? Or, any quantification, if you can help us provide on the China exposure and the overall balance sheet. Thank you.
I will ask Eugene to address that. Before we move off the topic of the development pipeline in India, hopefully what people has described to you is that, when we come out and tell you that there's X gigawatts is under development, relative to maybe what other people might be talking about as pipeline, the quality and the certainty that is behind it, you have to form your own judgment from what people is telling you, right? I think Niki's question is actually very straightforward. He's saying that: Look, you tell me this partner, how much is it gonna come? When is it really gonna come? Later, are you gonna say that, "Look, there's no connectivity, there's no land, there's no PPA," you know, and so on.
Without giving you a straight number, we are giving you the conditions under which we are the way we develop projects and then the risk that we're taking or not taking. Hopefully, I like to think that we are actually relatively when we say there's a pipeline, our pipeline is relatively of a much higher quality in terms of certainty and deliverable, right? Is there any guidance Niki was asking for in the renewables earnings growth?
I think, going into 2026, renewables as a, you know, a portfolio, we think, you know, from an earnings perspective, it will likely be flattish to slight upside. Okay? Because, there would have been better growth, but I think the reality is that we have hit with another SGD 12 million downside because of the VAT policy change, which came through, you know, unfortunately towards the later part of Q4 of last year. As a result, you know, we think renewables flattish to a slightly positive. I think for China, I just want to characterize the issue.
You know, I think from a, from a, you know, renewables book value standpoint, you know, it stands, you know, roughly from a SGD perspective, you know, SGD 1.8 billion-SGD 2 billion, right, of invested capital from an equity standpoint. Now, from a receivables, right, the receivables that are exposed, which is largely in our hydro portfolio that has not really cleared, that has not been given a green code in the subsidy audit is around SGD 350 million, like SGD, right. The total, you know, subsidy receivables on our books, really it's a, you know, approximately SGD 370 million. You know, those pending subsidy audit is about SGD 340 million-SGD 350 million.
Of course, we have made provisions, you know, against them, right? The provisions to date is about SGD 43 million against that gross amount. I think, in relation to that, you know, we continue to press, you know, respective authorities on, you know, being able to release, you know, those projects sooner rather than later. I think what we have noticed is that for projects that have cleared their subsidy audit, they are actually paying down their receivables fast. This is empirical, right?
Because, in our own portfolio, in our own hydro portfolio, the amount of subsidies, receivables collections in 2025 was about 1.7 times that of 2024. We see it accelerating, no doubt. In our JV portfolios, we also see their subsidy receivables collections, in 2025, you know, roughly, double that of the year before. I think there is a clear effort from the Chinese government to clear the subsidy receivables. You know, we are certainly hopeful while we continue to provision against it, the, you know, the subsidy receivables that has not yet cleared the, you know, audit.
Yeah, the so immediate 12 months, renewables, you know, we won't be seeing a lot of growth, but we're very comfortable because the pipeline is strong, and we've got new markets. Middle East, in addition to India, is actually very active, if I have to use that word, as you would know, and also now in, you know, Australia is coming in. We think, I'm not too worried about the 2028 target, if that's the follow-on question. Yeah. Yeah.
Maybe also just to add, what we are seeing, particularly in India, but also in other markets, is many competitors have overextended themselves, and there are now assets available, which makes sense for us. We are now in a position to be able to, acquire at attractive prices, add value through refurbishment and operations as we find the opportunities. That's the other one. These are all the way from relatively small to relatively meaningful, opportunities.
Can we have Silky at the back, please?
No, no, but.
Oh.
She has signed up for a while. Sorry, Silky.
Sorry.
Yeah.
Rachel first.
Hi, this is Rachel from UBS. I'm very sorry, Silky, for hijacking you. I have 2 questions. The first one is that, on SEI's Senoko Energy power plant contracting profile, does this include the new 600 MW plant? Because in 1H2025, only 13% of the portfolio had expiry profile of 0-5 years, and now it's 21, I'm trying to reconcile that. That's my first question. My second question is, what's the principal payment for the DPN versus the interest payment?
Mm.
Thank you.
When we say 80% contracted 5 years or more, it's 80% of what? Does it include the 600 megawatt plant?
Maybe if you bring up the slide, Gene.
Okay. You are referring to the Sembcorp only contracts, contracting, where 0-5 years has gone up to 21%. I think there are a couple of effects there, right? Number 1, you know, mainly, it is due to you know, basically, we are also, you know, contracting a little more in terms of the volume, right? We have secured more contracts that are of a shorter-term nature as well. Essentially, you know, from a contracted perspective, historically, when you saw that 13%, that was off a, you know, contracted capacity of about 960 MW or so.
I think, we have also increased our contract levels at the shorter term level. It has gone, you know, up to about close to 1,200 megawatts already. That's on the Singapore side. The base is 1,200 megawatts.
Today, our existing portfolio is less than 1,000?
It's No. When we showed the guidance earlier on at half year, right. Where it was a 13%, right. At that point in time, the contracted capacity for generation was about 960 megawatts, right. We did say that is one of our intent to sign more contracts. Even over our Singapore portfolio, we have contracted up to 1,200 megawatts already. Some of these are shorter term contracts, because we do want to increase the contract levels, and hence, you know, you see the 0-5 years increase to 21%.
Essentially, this 21%, but the total base of this is no longer 960, it is now about 1,200. In a way, it has included the 600. In a way, it hasn't. You see what's going on? Because what we're saying is that we want to sell 1,200 megawatts, of which some are long contracts, some are shorter contracts. And what happens is that when a new plant comes in, because it is much more efficient, what we'll do is that we back out some of the older ones. We can't.
I would guide you to not say that, "Look, when the new plant comes in, then suddenly our revenue, our megawatts will go up by 600 megawatts, and our revenue suppose go up 600 megawatts." It doesn't work that way, right? It's a portfolio, right? What Eugene is saying is that, yes, it is in there. Because part of the 10-year contract and the 5-year contract will be served using the new plant, right? No, it is not in there. We didn't add it up in blocks like that.
... hopefully that clarifies.
I think, Richard, you heard me talk about this because you stumped me a little bit, because we don't think in terms-
I stumped you, right?
We don't think in terms of, oh, this plant, and I contract for this plant, right? We think is okay. You know, our capacity is 1,002, potentially going up to 1,008. Today, if we see opportunities to contract ahead or over-contract with a forward start, then we will just increase our contract portfolio.
I think that this is maybe the first time we told them it's 1,200.
Yeah.
So-
Yeah. We maybe, Jim, we note to put a footnote or something.
Yeah. A question on the DPN.
Okay. For our DPN, you know, for the principal and interest payment, I think Rachel, in general, there is no fixed principal payment, right? Essentially, if you look at the mechanism, how it works is that whatever, you know, equity cash flows is generated at the plant level, right, it will be a full sweep of the cash, leaving 6.75% of the equity cash flows to the owners, right? I think in general, that is the basis. We have not, you know, there is no fixed principal repayment.
I think what we can look at is over the, you know, from a principal paydown standpoint, over the last 3 years, you know, we have, you know, collected SGD 1 billion. Of which the principal has ran down from, you know, roughly SGD 2 billion at the start of the period to about SGD 1.3 billion currently. Which means that on average, you know, the principal paydown is about SGD 300 million a year. I think going forward, you know, we do expect the SEIIL equity cash flows to be similar, simply because they are covered by long-term contracts. That would roughly be the paydown.
interest costs are still around, you know, 8.75% to 8.9%.
Okay. Sorry, Silky.
Hi. Thank you. Silky from CGSI. I have two questions. On gradual increase in dividend, to benchmark against yourself with peers. Who are the peer group that you're looking at? Are you looking at yield or payout? Given that your earnings base is potentially stable at SGD 1 billion, would you target to increase your yield to about 5%? That's my first question. Second question is, thanks for guiding us on the spark spread. With much more power coming into the market, would you be able to have a guess on what would be the spark spread into 2027? I remember previously, we were hoping to actually get more long-term contracts or convert some of the short-term contracts from Senoko to long term. How realistic is that?
Thanks.
Okay. I think, in terms of the dividend benchmarking, Silky, we look at the benchmarking in 2 steps. One is across, you know, more broadly, STI, you know, comps. Of course, within the STI comps, we look at both payout ratios as well as dividend yield. Excluding REITs, we do notice that, you know, average dividend yield is around 5%, right? Our yield is about 4% or so. I would hesitant to say that we are targeting a yield, Silky, because my payout ratio is kind of low, right?
We are at a 40-ish% right now, though we do note that number one, the average, you know, STI broader comps, their payout ratios are 60% or more, right? If we compare to, you know, a closer SLC industrial companies, right, you know who they are, just to name a few, includes CapitaLand, includes ST Engineering. Their payout ratios in the longer term are in excess of 70% or so. These are some of the guidelines that we are looking at. We also benchmark, you know, payout ratios as well as the dividend yields to a broader gen cos, right?
Both, you know, Asia Pacific as well as European players. In those situations, we do see average dividend yields also in the, you know, close to a 5% range, and average payout ratios for those are in the 60%-70% range as well. I guess, this is to guide you in terms of how we think in terms of the payout. I just want to caution a little bit about the yield perspective, because, you know, at the end of the day, while those are guidelines for ourselves, we are still focusing more on the absolute dividend and sustainable and growing over time.
You know, I guess, the key point to note is that where the dividend is, you know, going forward, we will have the ability to grow it, both from an earnings perspective and also looking at where our payout ratios stand relative to those benchmarks that I mentioned.
In the Singapore gas market or gas-fired power market, what will be the spreads into 2027? I don't have a crystal ball. At the moment, if you go out there to contract, you're getting mid-30s, right? That's, you know, you could see that still okay, right? The part that I described just now, they are going into new contracting, we will be contracting in that range. The 40-some % in Senoko will be contracting into that range. The 5% from the Sembcorp portfolio will be contracting into that range. What is the outlook for longer-term contracts? Actually, Singapore market is very small. Right? It is quite binary.
If you secure the customer, like in our case, Micron, Singtel, then suddenly there will be one big chunk that will come in, right? There is a group of customers that will be prepared to sign long-term contracts, and that group of customers is a finite universe today, even as the new data centers coming in to increase that pot, yeah. What we're seeing is that, as I mentioned, at the beginning of my delivery, we are very well positioned to chase after both the existing ones as well as the newcomers. Yeah. What is really specifically to Senoko, you will see I'm very confident to say that we will be able to increase Senoko's pie chart to look a lot more longer term than what it is shown today.
I hesitant to tell you exactly how much, because it depends on the lumpy big customers that will come in. If you think about it, they are indeed lumpy, right? Because when a data center comes along, it's 30 megawatts, 50 megawatts, and so on. It will suddenly shift the profile of that, of that donut over there.
Next question from Sumit.
Hi, thank you for your presentation. Sumit from JP Morgan here. Just have a couple of questions maybe on as our capital allocation. Do you think currently you have any non-core assets that may be up for disposals, the other businesses, even the UK plans? Any thoughts on that? Also, you did mention that actively looking at capital recycling in India. May I ask what's the progress there, and any timeline you have in mind? Perhaps my second and more housekeeping question: I think in one of the slides, you mentioned that one-third of DCs being catered by Gas and Related Services segment. Is that your own business, or are you talking about the broader Singapore market? Thank you.
The first question was non-core assets for disposal. I was trying to look at Eugene, and he was trying to look at me. The portfolio in Singapore, I think we manage the entire portfolio for value. Okay. I just want to reassure everybody, that's the first thing. Over the last five years, we have made several changes to the port. See you, Hong, huh? If you have questions, we can follow up later. Keep calling him. I think we already reorganized ourselves into the three big business segments, right? Gas and Related Services, renewables, as well as IUS. Most of the contributors are actually squarely slot into them, right? In the long run, you know, we do not have. I don't want to.
The smaller businesses, even if there is a non-core disposal, I wouldn't, I don't think it would be something that should bother you. Yeah, let's put it that way. Now, each of the lines of businesses, they are all growing up, and as they grow up, as you rightly pointed out, the India IPO possibility, that itself is actually something that is much more symbolic and significant to the portfolio if it happens. In terms of... To us, the India renewable portfolio is a core asset, right? That's not a non-core. I wouldn't put that in the category of the first question, right? Maybe the short answer to it, having thought very loudly in front of you, the short answer is no, right?
The second one is, in terms of capital recycling, we're thinking about it actually for the rest of the portfolio as well, including China, if the opportunity arises, right? Five years ago, I would tell everyone that, "Look, you know, that is too small in most of the pieces," right? Now India has grown up, and, you know, China is of a, in a certain state. When things are ready, we would definitely be managing them for value, right? I just want to reassure you that, in terms of actual timing, I am warned many times to not say that because we have a plan, right? There are typical timelines in India, how quickly you can do certain things.
And of course, there's no certainty until the moment the button is pressed, right? There are people who built a book and then decided that, "Oh, no, this book doesn't look good enough. I don't want to do it," right? You can... I don't think we would have the ability to do things much faster than the next guy who is falling. Let's put it that way. If you apply the usual timeline, that's a good way to think about if it happens. I'm sorry, I'm not answering your question. I'm struggling a little bit, but I have got strict rules tying my hands behind me. Sumit, do you have any other?
Yeah, I just had that quick follow-up. I think the data center slide, the slide that you mentioned where you have AI opportunities, and I think in Gas and Related Services segment, you show that one-third of data center. Yeah, this one, that first bullet, I just want to understand what it represents. Is it like for Singapore data centers, is it one-third of demand being catered to by your own plants? Is that what you're-
I'm sorry, I forgot about that.
Oh, no. Just to be clear, we have highlighted that before. Maybe we were not so clear in this bullet. We are supplying power to one-third of the current data center.
In Singapore.
In Singapore, right? Singapore, 1,400 MW of, you know, IT capacity. PUE is probably 1.25, 1.3. I think it's 1.3, right? You multiply that is the quantity that we are supplying to. It's fairly strong, right? I think, it's also instructive to note that the one-third of our capacity that we capture for these data center companies, they are of longer-term PPAs, right? Our understanding is that the other two-thirds, they are not really covered by long-term PPAs of our viewing. Yeah.
Okay, we'll take questions from the web first. There's a question from Mayank, from Morgan Stanley. He's asking about the U.K. impact on earnings and outlook in 2026, as does also the ability to put D.C. capacity in the U.K. In terms of China, any plans on adding battery investments into China for 2026? Lastly, if we can share any performance highlights from Alinta in the second half of 2025.
You want to take that?
The performance highlights from Alinta in the second half of 2025.
Okay. I think Mayank, in relation to a performance for Alinta, we certainly have not completed yet. I think, you know, the, you know, we will be in a position to, you know, speak more about Alinta once we have completed the acquisition. You would imagine that, you know, we can't, okay? We just can't. Of course, you could draw broader market, you know, a performance from the listed guys, right? You know, you've got Origin, you've got AGL. May not be directly comparable. You will just have to bear in mind that, you know, if there's any earnings volatility as a result of a cost of supply, that is not an issue for Alinta.
You can take guidance from where the other two guys are how they are doing. Of course, you know, pressure, if there's any, you know, volatility caused by cost of supply of electricity, we will be a lot more insulated because we are very long. Yeah.
When we talked about the Alinta acquisition, we showed the historical earnings profile, right?
Yes, that's right.
2024.
Yeah.
We also showed the pro forma, no?
Yeah. In 2024, you know, from a, underlying earnings standpoint, they are doing about, you know, SGD 400 plus.
400 plus, right?
Yeah.
They're not gonna suddenly go to 600, they're also not gonna suddenly drop to 300.
Yeah. Okay.
that's.
If you-
You can, by six months, you overlay with the amount of debt that we're putting on top of it, which we have also disclosed, right?
Yeah. Yes.
the level-.
We do expect the level of accretion in the second half of 2025 to be, you know, similar to what was disclosed. Yeah.
Yeah. To also point to the fact that because their first half is their winter, so typically, the first half is stronger than the second half.
Yes.
Sort of, 60%, 60%-70%, 60% in the first half, 40%.
Yeah
in the second half.
Second half.
Right. Hopefully that helps, Mayank. Any battery investment in China, even if there is, it will not move the needle. All right? He's being very kind. Thanks, Nick. He's being very kind in saying that, "Hey, looking you up, containment, maybe you should put in some batteries, so that then you don't waste the power." Thank you for that. UK impact on earnings, Mr. Cheng?
I think, you know, as highlighted earlier on, you know, the UK gas business, right, in 2025, we saw, you know, a SGD 20 million impact, right, for the UK gas business. Of course, when we look into 2026, there are headwinds, and also the possible and also positives. The headwinds, of course, you know, the customer demand continue to be under pressure, simply and power prices as well. Simply because, you know, the key, you know, some of the key customers in Wilton, they are, you know, petrochemical players, and we all know that the petrochemical sector is under pressure right now.
That is, you know, the headwinds that we expect going into 2026. Of course, we did, we are excited, because, you know, the value of powered land, particularly for data centers, is important, and Wilton is powered land, right? We do, you know, at a very initial stages of, you know, engagement, have, you know, have seen, you know, DC players, you know, interest, right, in our U.K. Wilton site. We hope to be able to see more developments there.
Of course, you know, barring, you know, possible developments on the D.C. capacity, we do expect U.K. continue to be under pressure as we go into 2026. Yeah.
Okay, I'll take another question from the web. This is from Louis Chua. He's asking about the run rate for the Gas and Related Services segment. Should we look at the GRS level to be roughly the 2026 run rate? Will the Alinta expenses be booked in the first half if the transaction closes by end of first half of 2026, or will it be booked at the year end?
Okay. Louise, to answer your question on the first point, I think from the second half 2025 going into FY 2026, I wouldn't say that we could use that level, because a couple of things you will have to bear in mind. Number one, you know, into 2026, roughly 3%-5% of the Singapore portfolio will be up for renewals. Those renewals will be at roughly $35, $30-$35 type of a spark spread. You know, that will be coming off, you know, historical high short-term contracting spark spreads of, you know, $70 or so, like $70-$80.
That's one impact. Second, impact is for Senoko. We did highlight that coming into 2026, you have a full year impact of roughly 20% of the portfolio, you know, that was a, that was, you know, a renewed in the second half of 2025, right? Also, $30-$35 spark spread. In 2026 itself, we would have about 47%, close to 50%, of the Senoko portfolio that will be up for renewals. Indications clearly show that spark spreads will be around $30-$35. You do have to factor that into your outlook for 2026.
Now, for the exceptional expense of AUD 208 million, it will be reflected, you know, whenever the transaction close, right? If the transaction close in the first half, that 208, the bulk of it will be booked as exceptional items by half-year. If it does, it will close beyond 30th June, then, you know, it will show up in the second half. It's really a timing-related. Bulk of that is, you know, driven by stamp duties. It's really, you know, linked to the timing of the completion of the transaction.
Okay. Question from Asha, Business Times.
Yep. Thank you for the presentation. I'd like to ask a bit more about the data center strategy in terms of supplying energy. For DC-CFA2, there is a requirement, I think it's at least 50%, has to be like clean power. For yourselves, like, what sources of clean power do you see yourselves, you know, providing in terms of fulfilling this demand from DC-CFA2? I think for other markets in the region where you hope to power data centers, you know, do you see it mainly being gas or more of renewables?
The specific requirements or rather the requirements of the DC-CFA2, my understanding is that it is actually quite specific. It will have to be new sources.
Yes.
Right? It is not existing, so my solar panel doesn't count. We are working with our customers who are interested to win the DC-CFA2, to provide them with new sources. That includes green power from biofuel. That includes fuel cells, right? The array of potential solutions that can qualify for this new green source, we actually have them as part of our toolkit to supply them. The question really is, for each one of them, because difference in size, difference in technology, difference in their customer base, their appetite to absorb the cost from some of these new sources is different. You can imagine some of these new sources is at a higher cost than a solar, right?
That's why what I'm trying to say is that we have those solutions, and we are working with each one of them to tailor it for their specific requirements based on the affordability, right? That's, that's on the, on that. The other one I want to say is that for, generically, like you say, whether it is in the region or even in Singapore, at the end of the day, data centers, they need very stable, reliable power. Highly reliable, in fact. They don't want interruption. The new sources, generally, on the one hand, will put cost pressure. On the other hand, very often it may not be as reliable, right?
Certainly, even if you, if they are reasonably reliable, you still need a backup from existing sources, be it from batteries, be it from gas, be it from the grid, right? This is where Sembcorp believes we are actually very well positioned, because we have the entire array. In Singapore, we have got the gas-fired power plants, we have our solar panels, we have the largest battery in the region, and then on top of that, we've got these new sources, biofuel, fuel cells, so on and so forth. Yeah. We are able to say that, "Hey, look, you know, even as you take the new source, we can supplement it and support it, and provide insurance and reliability by giving you everything else," right? That is where we are. We have that strength.
In the region, it is the same, right? When we go to Batam, you know, this is something that we can offer, and our experience doing this is also giving them confidence, right? If you're getting this from Sembcorp, that's one story. If getting this from only a solar player, you might actually have to think twice because, hey, you know, how good are they, even if they offer you batteries, right? I've got gas, I've got other sources, and I have shown that I am able to keep reliability very, very high as a portfolio. That's where, you know, even in places like India, not just Indonesia, we are seeing some of these demands coming.
We are, on the slide that we showed here, we are signing up, actually, beginning to sign up some of them, right? Coming back, I also want to make that point. I want to reiterate the point that by the time we see the demand from the AI side, we are seeing the real thing. This is the solid demand. This is not the fluff. Because I'm very worried that people say, "Oh, you know, this Sembcorp suddenly turned around and want to enter into the AI space, you know, are they going to catch the fluff and then get caught up?" You know? No, no. By the time it comes to us, it is a solid energy side of the demand, not the AI demand. We don't take that risk.
We are selling power. We are selling reliable power, and we demand and expect that our customer is a reliable paymaster.
We have, I understand you have import licenses from EMA, right? For, like, Sarawak and also from Vietnam. Would the new sources that you supply to D.C. also include, like, green power that you are importing?
My understanding is that imported green power doesn't count.
Oh, it doesn't. Oh, okay.
Yeah. We can confirm that after the meeting, but my understanding is that they don't count.
Oh, okay.
Yeah.
Thank you.
If they, if they count that, we also have that, right? In fact, last year we imported some, and then that contributed to some of, some of my losses in the previous year. It was a good, what? SGD 40 million. Yes, the Malaysia one, I'm glad that it's almost over. It will not weigh so heavily onto 2026 anymore. Yeah.
Okay.
Any other queries?
Yeah.
Okay.
There are no further questions. If not, that marks the end of today's briefing. Thank you very much for attending the briefing, everyone.
Right. Again, you know, two things to take away, if I may. In terms of returns, you know, can expect dividend to steadily sustain and grow, and we recognize that we are behind the curve compared to our peer group in terms of payout, in terms of yield. Because of our strong balance sheet, strong cash flow, we are very confident increasing the dividend along that path to cover that gap. That's the first thing. In terms of growth, at least for the next few years, we've got new markets that we are venturing into, and we are seeing success. In the case of Australia, there's Alinta, very skilled, very committed to decarbonization and also very energy-short, right?
In terms of other greenfield opportunities, other than a very hot India market where we have strong establishment, there is also Middle East that is giving us that pipeline. There is returns, there's growth. You know, 2026, we will have headwinds, but we are very confident sailing into 2026 and beyond. Thank you very much. Thanks.
Thank you.
Okay. Is there food outside?
There is none.
Okay. Sorry. Sorry to hold you. There's food outside, and, you know, please feel free to help us consume it.