Mac Telecom on track for earnings

Business and government telecommunications provider Macquarie Telecom has maintained earnings guidance for the full 2010/2011 year amid increased demand for its hosting and information technology services.

Statutory net profit for the six months to 31 December 2010, came in at $9.72 million, Macquarie Telecom said, down 21 per cent from the prior corresponding period.

But the company said net profit rose 102 per cent when the results of discontinued operations, a Singapore subsidiary sold to CITEC, were excluded.

"The company is experiencing increased demand for its hosting services due to the growing trend of selective outsourcing of internal information technology," Macquarie Telecom chief executive David Tudehope said in a statement.

"We believe this trend of outsourcing is accelerating due to higher speed internet connectivity driving new web technology and the associated demand for managed hosting."

Macquarie Telecom said earnings before interest, tax, depreciation and amortisation (EBITDA) from continuing operations was $20.3 million in the first half, in line with company guidance issued in January.

The company also reaffirmed full year earnings guidance for EBITDA to be in the vicinity of $37 million to $39 million, representing a 30 per cent rise from the prior year.

Last year the company posted a full year net profit of $18 million.

Macquarie Telecom is in the process of installing a second datacentre in Sydney, worth $59.8 million, expected to be completed at the end of this year.

The company has this year launched a new enterprise-managed cloud service for which it is currently taking orders from businesses. Macquarie Telecom has also just launched Ninefold, a self-managed cloud offering.