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NextDC makes $10M loss after ‘record investment’
- 29 August, 2019 10:43
Craig Scroggie (NextDC)
NextDC has ended a year of heavy data centre expansion with a $9.8 million loss after tax.
The colocation provider’s results for the year ended 30 June marked a 248 per cent dip in its $6.6 million profit last year, and a continuation of its half-year posting back in February.
The loss comes off the back of NextDC’s $470 million investment in two new data centres in Sydney and Perth — S2 and P2 — and its acquisition of Asia Pacific Data Centre (APDC) Group for a final sum of $261 million at the end of last year.
At the same time, the final balance sheet showed a 15 per cent rise in the ASX-listed company’s total revenue, which reached $179.3 million. Of this, $169.7 million came from its data centre services, while another $9.6 million was attributed to ‘other’ revenue.
Its EBITDA also rose year-on-year by 2.5 per cent to $79 million.
The loss was reflected in NextDC’s $16.2-million increase in operational costs, with the company adding it had made new investments in central operations, customer experience and IT to support network and site expansion.
Despite this, CEO Craig Scroggie was buoyed by the results.
"We are pleased to report another year of record revenue and EBITDA, demonstrating the inherent operating leverage of the business,” he said. “These results were achieved during a period of record investment in our next generation of world-class Tier IV data centres.”
He added that the company was now in a prime position to take advantage of “customer-driven expansion opportunities”.
NextDC’s second Sydney data centre opened earlier this year and has now received an Uptime Institute Tier IV design certification.
The second Perth centre is currently being built and completion of the first tower is expected in the second half of the 2020 financial year, while extra data halls have been added to the Brisbane and Melbourne facilities B2 and M2.
NextDC told shareholders that it expects capital expenditure to fall to between $280 million to $300 million, a drop from 2019’s $378 million.
Beyond Australia, NextDC opened a new office in Singapore earlier this year but has put a halt on activities there while “the Singapore Government undertakes a review of the data centre industry”.
The company was unable to provide shareholders with any further assurances on future developments in the market pending the government’s review.