NextDC makes $3.1M loss as data centre expansions get underway

Craig Scroggie (NextDC)

NextDC has entered the red for the half year ending 31 December after period of heavy expansion, posting a $3.1 million loss after tax.

The colocation provider's loss after tax represents a fall of $11.5 million year-on-year, and $6.6 million down from the end of 2018. 

The loss follows NextDC’s acquisition of Asia Pacific Data Centre (APDC) Group for a final sum of $261 million at the end of last year.

The publicly-listed firm had held a 29.2 per cent stake of APDC and offered all-cash acquisition of the remaining 70.8 per cent. The deal gave it full ownership of its data centres in Perth, Melbourne and Sydney, dubbed P1, M1 and S1.

In addition, NextDC spent up to $470 million on building new data centres in Sydney (S2) and Perth (P2), plus expanding the number of halls at existing centres in Melbourne (M2), Brisbane (B2) and Perth (P1).

S2 and P2 have already opened for ‘early customer access’, according to the shareholder update of 27 February. 

NextDC also completed a $24 million acquisition of its Brisbane data centre property, dubbed B1.

Meanwhile, the company’s revenue hit $90.7 million, a 17 per cent rise from the previous corresponding period. Its earnings before interest, tax, depreciation and amortisation (EBITDA) also rose by a quarter to $42.2 million.

“Today’s results are in line with plan and are a testament to NextDC’s strong fundamentals reflecting the inherent operating leverage of the business,” company CEO and MD Craig Scroggie said.

“The first half was a record period for new investments in both the development of our next generation of world-class Tier IV data centres and our innovative connectivity service offerings.”

Based on the impact of the acquisitions, NextDC lowered its revenue forecast for the end of the 2019 financial year, predicting it to reach up to $184 million as opposed to the previous expectation of $188 million.