NextDC posts first after-tax loss since 2016

NextDC's profitability has tanked due to rising costs, despite continued revenue and customer growth.

In its FY19 financial results (pdf) the colocation provider said profitability was affected by higher depreciation and interest costs relating to investments made over the past year, posting a $9.8 million after-tax loss compared to a $6.6 million profit in FY18. This would be the first time NextDC posted an after-tax loss since the 2015 financial year.

Revenue for the period was $179.3 million, up 15 percent from $156.3 million in FY18, while EBITDA came in at $85.1 million, a 13 percent increase from $75.6 million. Depreciation and amortisation costs increased 47 percent to $48 million, while finance costs were up 113 percent to $54.9 million.

NextDC chief executive Craig Scroggie said the results were achieved during a period of “record investment” in its data centres. “We are pleased to report another year of record revenue and EBITDA,” he added.

The company also revealed growth in utilisation, customers and interconnections, with Scroggie calling FY19 NextDC’s biggest sales year to date.

As of 30 June 2019, contracted utilisation was up 31 percent to 52.5 megawatts, customers were up 22 percent to 1184, and interconnections are up 27 percent to 10,972.

NextDC also completed its $261 million acquisition of Asia Pacific Data Centres (APDC), revealing that it is now saving $15 million per year in rental costs. APDC is a property trust spun off from NextDC in 2013, which owned the land occupied by NextDC's S1, M1 and P1 data centres.

Looking ahead, NextDC is expecting revenues to break the $200 million mark in FY20 and for EBITDA to reach $100 million. It also plans to spend more on the continued expansion of its S2 data centre, as well as the ongoing construction of P2.