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Australia's NextDC winds back Asian expansion plans as pandemic bites

Australia's NextDC winds back Asian expansion plans as pandemic bites

NextDC has established an office in Singapore and another in Japan to explore local opportunities.

Craig Scroggie (NextDC CEO and managing director)

Craig Scroggie (NextDC CEO and managing director)

Credit: NextDC

Australian data centre operator NextDC has had to rein its ambitions to expand in Asia due to the ongoing COVID-19 pandemic.

In 2019, the company quietly launched an office in Singapore and another in Japan to explore local opportunities.

In a shareholder update released on 27 August, the publicly listed company said it had had difficulties getting to and from Singapore and Japan due to border controls. 

“We view these opportunities as transformative in nature and remind ourselves that people frequently overestimate what they can achieve in one year and underestimate what can be built in a decade,” the company said. 

“Despite COVID-19 related challenges, we continue to aspire to build a successful regional business over the next 10 years.”

Regardless, the 2021 financial year saw NextDC has shave A$25 million off its 2020 loss after a year of strong growth across Australia. 

The data centre operator posted a net loss after tax of A$20 million for the year ended 30 June 2021, a reduction of 24 per cent from its A$45 million loss year-to-year. 

The results come as NextDC posted revenue of A$246.1 million, a rise of 23 per cent from the A$200 million in FY20, while earnings before interest, tax, depreciation and amortisation (EBITDA) rose by 29 per cent to A$133 million. 

Although NextDC’s operating costs went up by 16 per cent to A$111 million, the company did not receive a tax bill this year, having paid a meaty A$26 million last year.

Meanwhile, the company said it had seen strong growth in recurring data centre services revenue, underpinned by long-term customer contracts. 

Now boasting nine data centres, NextDC has set its sights on expansion in Western Australia, where the company said it had the most connected ecosystem of partners and ICT service providers including the cloud platform on-ramps for Microsoft and Amazon Web Services (AWS). 

The company is also currently building a third data centre in both Sydney and Melbourne, while expanding its second data centre. 

The company currently has 271 employees and 730 partners, as well as 14,718 interconnections.



Tags SingaporeNextDC

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