NetComm Wireless appears set for a banner year, as the company reported record revenue and earnings for the first half of the 2018 financial year.
The company on Wednesday reported AU$88.6 million in revenue for the half to the end of December, an increase of 89 percent on the AU$50.7 million reported this time last year, as well as a thirteen-fold jump in earnings before interest, tax, depreciation, and amortisation (EBITDA) from AU$681,000 to AU$9.2 million.
Broken down between its broadband and machine-to-machine (M2M) segments, revenue for the former business fell slightly to AU$13.8 million, but EBITDA spiked from AU$139,000 to AU$1 million. For its M2M business, revenue more than doubled from AU$36.6 million to AU$75 million, and profit jumped from AU$542,000 to AU$8.2 million.
NetComm pointed to its contracts with NBN for helping grow its revenue, particularly the delivery of distribution point units for the government-owned wholesale broadband provider's fibre-to-the-curb (FttC) network.
Over the second half of the year, as the FttC network is lit up and NetComm's network connection devices (NCDs) are deployed, the company will begin to receive the AU$66 million it is slated to receive over 18 months.
"We were pleased to have further enhanced our relationship with NBN, signing a contract to supply NCDs for their FttC project. This world-first device incorporates a G.fast/VDSL modem with reverse power feed capability, as well as monitoring and diagnostics reporting in a single device," NetComm Wireless CEO and MD Ken Sheridan said. "We continued to roll out the Ericsson/NBN fixed-wireless contract and anticipate launching a new 100Mbps service this calendar year, our third technology upgrade in only four years.
"We delivered our first sales of fixed-wireless devices to AT&T for the initial rollout, and while the pace of the rollout has been slower than initially expected, we anticipate an acceleration in FY19 as AT&T look to ensure 1.1 million premises are available for service by 2020."
NetComm had announced partnering with AT&T last year, with the company to supply outdoor wireless antennas enabling connectivity speeds of at least 10Mbps to under-served premises across 18 states in the US.
The company said it expects revenue and EBITDA to grow over the second half, and is carrying no bank debt.
The company has been working with NBN on its fixed-wireless network for years, entering the project via a backdoor by partnering with Ericsson on developing a solution for a layer 2 wireless network.
"They tendered this out and it was really nice architecture, but it hadn't been done before anywhere in the world," NetComm CTO Steve Collins told ZDNet last year.
"Ericsson worked out how to do the base station piece, but they needed a company who could design a brand new device, a thing called a CPE [customer premises equipment] or a WNTD [wireless network terminating device], that would connect to the network wirelessly but then provide this layer 2 tunnel through the whole network.
"We sat down with Ericsson and came up with a whole new architecture for how to do this layer 2 tunnel wireless network that people just call fixed-wireless now -- but it had never been done before."
NBN's fixed-wireless network is slated to connect 600,000 premises in regional areas across Australia by using a 4G-like service where it is considered uneconomical to roll out fixed-line access; however, NBN CEO Bill Morrow last week told ZDNet that it is still working out how to offer a 100Mbps product.
"We know that the radio technology and the antenna technology that we have can support 100Mbps on fixed-wireless -- and that's with the 4G protocol, that's even pre-5G. But the issue quite frankly is how would that be used because of the spectrum limitations, because of the nature of fixed-wireless in itself, when it comes to the peak period of the day, there is going to be a different experience people get, and to stay at that 100 megabits per second would be unlikely in the evening hours," Morrow told ZDNet.
Morrow explained that the 100Mbps speeds could be offered to consumers "as long as it's clear that it is more out of busy time sort of speeds that they would be observing".
An initial volume order will see NetComm Wireless clock AU$66 million in revenue by providing its intelligent, reverse-powered FttC network connection devices with inbuilt VDSL and G.fast modem to NBN.
NetComm Wireless and AT&T are focused on bringing broadband connectivity to rural areas across 18 US states using fixed-wireless, while AT&T also rolls out its '5G Evolution' network to 20 metropolitan areas.