Megaport says it's on track to see EBITDA break even despite AU$38m net loss

Company believes the positive contributions made by each region will help it achieve its goal.

Australian interconnection services provider Megaport has seen its revenue increase 39% to AU$36 million for the half year ending December 31, however at the same time, its net loss widened from AU$19 million last year to AU$38.4 million.

Once network and operating costs were taken out of its revenue number, Megaport reported normalised earnings before interest tax depreciation and amortisation (EBITDA) of minus AU$8.68 million, a 15% improvement on last year's minus AU$10.27 million. The company touted this as an improvement with the EBITDA loss representing 24% of revenue compared to 40% last year.

Looking at the revenue composition, Megaport now gets AU$6.3 million each month in recurring revenue, which is a 37% increase on last year, which the company said was driven by an increased uptake of the company's services globally.

By region, North America increased its contribution by just over 50% from AU$11.4 million to AU$17.2 million, APAC moved from AU$9.4 million to AU$12.3 million, and Europe increased from AU$5.1 million to AU$6.5 million.

Additional employees saw employee costs move from AU$16.2 million to just over AU$20 million for the half year. This was offset by a 98% reduction in travel costs from AU$1.72 million to AU$32,000 due to the impact of COVID-19.

"With all regions now EBITDA positive, we are on track to achieve EBITDA breakeven for the group on a run rate basis this fiscal year as we continue to optimise our footprint to maximise margins and move to profitability," CEO Vincent English said.

Similar thoughts were expressed when Megaport recently handed down its second-quarter results for 2021.

On Wednesday, Megaport also confirmed it would be launching its network virtualisation platform, Megaport Virtual Edge, with Cisco on board as an integration partner by the end of March.

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