Macquarie Telecom cashes in on data centre capacity demand during 1H21

Revenue jumped 9% to AU$144 million while EBITDA lifted by 15% to AU$36.4 million.
Written by Aimee Chanthadavong, Contributor

Macquarie Telcom boasted on Thursday it has delivered its 13th consecutive half of revenue and earnings before interest, tax, depreciation, and amortisation (EBITDA) growth during the first half of the 2021 financial year.

For the period to December 31, revenue increased 9% year-on-year from AU$132 million to nearly AU$144 million, while EBITDA jumped 15% from last year's AU$32 million to AU$36.4 million.

Net profit after tax increased slightly by 5%, reaching AU$7 million during the half.

When examining the results based on business units, all of them experienced revenue growth, with particularly strong growth in cloud services and government, which saw revenue increase by AU$8.4 million to nearly AU$65 million.

The company's telecom business, however, once again made up most of the group's revenue, which reached around AU$69 million, as it continues to help customers migrate services to the NBN network, which it expects will be completed later this year.

According to CEO David Tudehope, the uplift experienced by the company was due to increased demand for data centre capacity.

"Macquarie's 20-year strategy of investing in world-class data centres is based on strong demand for data centre capacity as customers migrate to cloud and colocation services," he said.

"The win, of the 10MW of IT Load sold to a Leading Corporation, recognises the world class investment we have made in the Macquarie Park Data Centres Campus in Sydney's North Zone."

The company also took the opportunity to provide an update on the build of its Intellicentre 3 East (IC3) in Sydney's Macquarie Centre, saying it's currently "on budget and will achieve practical completion in March 2021". It noted that expenditure for IC3 will be between AU$123 million to AU$126 million for FY21.

The Intellicentre 5 (IC5) in Canberra, meanwhile, was completed on time and on budget, the company added. Last year, the company announced it would invest AU$17 million to build the new data centre, which would feature an initial capacity of 1.5MW.

IC5 sits alongside Intellicentre 4 (IC4) and provides further capacity for government cloud workloads, features a Tier IV, SCEC Zone 5 ready data centre, and is supported by over 150 NV1 government-cleared cybersecurity. The build of the IC5 involved 4 kilometres of underground electrical conduit, 15 tons of copper in the main cables, and generators that are "powerful enough to run 400 homes", according to the company.

Further, Macquarie Telecom noted that during the first half it commenced providing cybersecurity services for the Australian Taxation Office after it secured the AU$20 million contract with the government agency at the end of 2019.

Looking ahead, Macquarie Telecom said it expects FY21 EBITDA to be approximately AU$72 million to AU$75 million.

Excluding IC3, total capex is expected to fall between AU$57 million and AU$66 million for FY21, Macquarie Telecom said, noting it will consist of customer growth of AU$25 million to AU$28 million, growth capex of AU$17 million to AU$20 million, and maintenance capex of AU$15 million to AU$18 million. 

Updated 25 February 2021, 3.23pm: Additional IC5 information added.

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