Field Solutions Group (FSG) is to split its business into two separate units as part of a wider diversification push.
The publicly listed company has proposed a logical separation in the upcoming financial year that would split its core internet service and managed services provider (ISP/MSP) from its infrastructure business.
Outlined in an investor presentation, FSG said the core ISP/MSP unit would be focused on expanding and diversifying its revenue base, as well as its its mobile strategy.
Meanwhile, the infrastructure unit would be focused on growing its rural footprint, including the deployment of 16 networks and 127 towers. It would also span active sharing deployment, which covers its role in the federal government’s neutral host pilot program and the NSW government’s mobile connectivity pilot program.
The logical separation proposal follows FSG’s results for the 2022 financial year, which saw revenue grow by a record 127 per cent, to $42.7 million, as its net profit after tax (NPAT) fell 38 per cent to $1.3 million.
By comparison, its NPAT in FY21 sat at $2.1 million, bouncing back from a loss of $500,000.
Earnings before interest, tax, depreciation and amortisation (EBITDA) were also up by 113 per cent, to $4.6 million.
The growth in revenue and EBITDA, according to the rural and regional telecommunications carrier’s CEO, Andrew Roberts, “reflect the growth, maturity and scale we are enabling in our core business”.
Part of this included the deal to acquire TasmaNet, which was struck in October 2021 for an initial consideration of around $13 million on a debt-free, cash free basis, or roughly $12 million net, with an additional earn out consideration of up to $2 million.
It also grabbed a five-year managed services contract with Kestrel Coal's mine in Emerald, Queensland, back in February, worth up to $25 million.
“We select key agribusiness and mining corridors across Australia, ensuring we build our carrier grade networks to meet demand,” said Roberts.
“Enhancing our connectivity with our newly formed managed services group, ensures we are to provide a mix of end-to-end products and services to our target markets.”
As for the financial year ahead, in addition to the proposed logical separation, Roberts said the carrier’s key priority is to complete its 16 networks currently under construction, start the federal government’s neutral host pilot program and continue participating in phase two of the NSW government’s mobile connectivity pilot program.
Generally, FSG also expects to continue its business plan of building and expanding telco networks in rural, regional and remote Australia, as well as leveraging those assets to expand and create new revenue streams.