Macquarie Telecom marks 5th year of profitable growth as FY19 revenue nears A$250m

Macquarie Telecom Group has announced its FY19 results, showing five successive years of profitable growth as revenue nears the A$250 million mark.

The company has said it will continue to invest in hybrid IT, cloud (including adding public cloud capability) and cyber security, as it migrates thousands of customers to the NBN under the agreement announced last year.

“Macquarie’s profitable growth has enabled us to invest across our four business units,” said the firm’s Chief Executive David Tudehope. “The success of our private cloud and cyber security services underpins our Hosting revenue and profit growth.”

KEY RESULTS

Full year revenue increased 6% to A$246.6 million for FY2019, up from A$233.6 million for the prior year.

Earnings before interest, tax, depreciation, and amortisation (EBITDA) was A$52.1 million for FY2019, an increase of A$4.3 million on the prior year and in line with guidance.

Net profit after tax decreased 3% to A$16.5 million compared to a profit of A$17.0 million for the previous corresponding period, which the telco attributed to increased depreciation.

Capital expenditure for FY2019 was A$46.1 million (FY18: A$33.8 million) driven by growth Capex of A$14.8 million for: The Fortune 100 Customer Stage 3 and Data Hall 4 fit out, NBN migrations, Government Cloud and IC3 investment.

In addition, customer related Capex was A$21.8 million while Maintenance Capex was A$9.5 million.

KEY GOALS FOR FISCAL YEAR 2020

Macquarie Telecom said its focus in fiscal year 2020 would center around improving customer experience to ensure a leading Net Promoter Score. In addition, its Government team will prioritise its efforts on growing revenue in both cyber security and secure cloud computing.

“Telecom will continue to migrate thousands of customer’s services to the NBN under the company’s six-year wholesale supply agreement with NBN Co,” it added. “Telecom Capex will increase from A$15.8m in FY19 to $A25-A26m in FY20. The increase in capex can be attributed to both growth and customer capex projects in FY20 including the Telecom core network upgrade and a continued investment in new data networking technology (SD WAN).”

LOOKING AHEAD

The company said its EBITDA will continue to grow in FY20, noting however that the 1H FY20 will be flat compared to 2H FY19 due to one-offs received in June 2019 and further investment in sales growth in its Hosting business.

While a delay in planning and approval will mean practical completion of IC3 East (part of the Macquarie Park Data Centre Campus) will be pushed on from 1H to 2H CY20, the company said this would impact its ability to support its customers’ current and future growth plans.

Upon completion, the Macquarie Park Data Centre Campus will provide 43MW in total load, a significant increase on the current 10MW facility.

The Company plans to make a significant investment in growth and customer growth capex (excluding IC3) during FY20.

Total capex, excluding IC3 East, is expected to be between A$51-A$54m consisting of:
Growth Capex – A$12 to A$13 million
Customer Growth Capex – A$24 to A$25 million
Maintenance Capex – $A15 to A$16 million

 

Macquarie Telecom to offer Apple mobility products, services to Australian mid-market businesses


Macquarie Telecom is set to target Australian mid-market enterprises with a range of mobility offerings, following what the telco tipped as “a landmark deal with Apple.

Macquarie Telecom said it will offer both bespoke and off-the-shelf iOS apps for business with world-class products like iPhone and iPad.

“This offering will help mid-sized businesses in Australia experience the power and value of Apple,” said Luke Clifton, Group Executive, Macquarie Telecom. “We’re backing the best devices for business coupled with native apps that will see our customers become more mobile, increase productivity and solve more business problems.”

The offering will initially focus on the delivery of core Apple products and business apps, before expanding to deliver a device enrolment program integrated with Apple Business Manager, in order to streamline the on-boarding process for customers.

“We’re aligning with the best technology providers to meet our customers’ evolving needs,” added Clifton. “Mobility used to be an afterthought, but that is changing as enterprises’ needs change. This move will see business mobility become a business-leading area of our company.”

“We’re developing relationships and building our business in a way that improves customer service, creates more local jobs and helps businesses innovate,” he said.

Apple devices will be available within Macquarie’s portfolio from 23 August 2019.

Dayle Wilson returns to Macquarie Government as product and operations head I

Macquarie Government has welcomed back int the fold, Dayle Wilson, who returns to take on the role of head of product and operations.

Wilson’s brief will see him supporting the business’s expanding suite of government-focused services, including its Australian Signals Directorate (ASD)-certified Government cloud services.

Wilson, who most recently served as Chief Operating Officer at Brennan IT, previously spent a decade with Macquarie Telecom Group across various tech roles including as CTO.

“Macquarie Government has a unique position. On the one hand, it can leverage the Macquarie Telecom Group’s 27 years’ heritage as a proudly Australian challenger communications business with a laser focus on customer service and commitment to bringing to market pioneering technology,” said Wilson. “But Macquarie Government itself is solely devoted to understanding and meeting the needs of government agency customers, supported by a team of more than 100 government security certified engineers, all based in Australia.”

Wilson noted a  growing recognition by governments globally of the need to develop national capability in both cloud and cyber security.

“Macquarie Government’s recent strong growth shows it is well placed to respond to these priorities from Federal and state governments,” he added. “I’m excited to have the opportunity to come back to Macquarie to be a part of building what I believe is a business for the future.”

WA aged care provider readies for digital Royal Commission with MacTel SD-WAN

Macquarie Telecom has signed a deal with aged care provider Royal Australian Air Force Association (RAAFA, Western Australia Division), under which it will deliver SD-WAN capabilities and help the organisation prepare for the digital aged care future.

RAAFA is a trusted retirement living and aged care provider in WA operating six retirement villages comprising 1,420 living units and apartments, 19 assisted living units, 446 residential care places and 14 short stay accommodation units.

“RAAFA is putting its residents first by building a network capable of delivering home care technology our elderly need,” said Macquarie Telecom Group Executive Luke Clifton.

As part of the deal, Macquarie Telecom has rolled out its SD-WAN service to facilities  in Erskine and Albany struggling with poor bandwidth and internet connectivity. Prior to the deployment, staff at the two sites could not reliably access services such as security, CCTV monitoring and financial systems.

The network also experienced a complete outage on a monthly basis,” said the telco. It noted that the technology had boosted speeds five-fold, reducing outages to zero and bringing it up to speed with other sites.

“One of the key terms of reference for the planned Royal Commission into aged care is how to ensure more people can remain at home as they age,” said RAAFA ICT GM Craig Burkett.

“Technology will play a huge role in that – through sensors in the home, virtual reality and more,” he said. “We’re leveraging the full suite of Macquarie’s services, including SD-WAN and cloud, to build a network across all our facilities that will enable us to provide a higher standard of care for the elderly in WA.”

 

Macquarie Telecom Group notes 4th successive year of solid profit

[the_ad_placement id=”in-content”]Macquarie Telecom Group has announced its results for the full year ended 30 June 2018 in line with updated guidance and declared a final dividend of 25cps, fully franked.

Chairman Peter James said, “Consistent execution of our strategy has delivered four years of consecutive growth. We will continue to invest to benefit from the megatrends of cloud and cyber security.”

KEY POINTS 

  • Full year revenue was up 6% to $233.1 million for FY2018 compared to $219.7 million for the previous corresponding period.
  • Earnings before interest, tax, depreciation, and amortisation (EBITDA) of $47.8 million for FY2018, an increase of $7.5 million or 19.0% on the previous corresponding period and in line with upgraded guidance.
  • Cash flow from Operating Activities of $42.9 million. The company is debt free and has a closing cash balance of $30.3 million as at 30 June 2018.
  • Net profit after tax was up 20% to $17.0 million compared to a profit of $14.2 million for the previous corresponding period.
  • Capital expenditure for FY2018 was $33.8 million (FY17: $38.5 million) driven by growth Capex of $11.5m for: The Fortune 100 Customer; Government Cloud, Data Hall 4 fit out; SD WAN investment and Telecom NOC insourcing project. In addition, customer related Capex was $11.0m and maintenance Capex $11.3m.
  • Final dividend declared of 25 cps, fully franked which brings the Company to a full year dividend of 50 cps.

Chief Executive David Tudehope said “Macquarie’s profitable growth has enabled us to invest across our business units. Our confidence in the continued growth in demand for Cloud underpins our decision to invest $75-80m in the Macquarie Park Data Centre Campus.” 

PRIORITIES IN FISCAL YEAR 2019

  • Focusing on customer experience to ensure a leading Net Promoter Score.
  • Leveraging the 42% of the Australian Government who have contracted with Macquarie Government, the Government team will be focused on growing revenue in both cyber security and Secure Cloud computing. Our Cloud computing offering is certified by the Australian Signals Directorate.
  • Telecom will continue to invest in new data networking technology (SD WAN) and will achieve a full year benefit from the insourcing of the NOC in FY19.
  • Hosting has delivered Stage 2 of the Fortune 100 customer at Intellicentre 2, with full revenue earning capacity in FY19.
  • OUTLOOK

    The Company announced the expansion of its existing Macquarie Park Intellicentre to a 43MW Campus. The Campus is designed to meet the growing needs of global hyperscalers and cloud, enterprise and Government customers.The Company’s EBITDA will continue to grow in FY19, however the 1H FY19 will be flat compared to 2H FY18 due to one-off or abnormal items received in June 2018 and further investment in sales growth.

  • The Company expects that the initial capital expenditure on the Intellicentre 3 East (IC3 East) Data Centre will be approximately $75-80 million, the bulk of which will be incurred across calendar year 2019.  This capex will be partially offset by a fee from Keppel DC REIT to the value of $26-36m for the development of IC3 East core and building shell.
  •  The services offered under this six year agreement will include dedicated, Australian based nbn™ service delivery, assurance and support staff for Macquarie customers.
  • It is expected that the first customers to be connected to the new services will commence billing in Q2 of the 2019 financial year.
  • The existing Fortune 100 customer has contracted for an additional 1.4MW of capacity to be provided over the remainder of the initial contract term. The Company will invest approximately $8.4 million in data centre mechanical, electrical and plant over the next eight months to expand its capacity to meet this demand. The additional capacity is expected to be ready for service in Q4 FY19.The Company announced that it has entered into a wholesale supply agreement with NBN Co. The deal will enable the provision of telecommunications and data services to Australia’s business community.
  • The Company will enter a 20 year lease with Keppel including options to renew. This data centre development will be funded by structured debt financing due to be finalised in Q1 FY19.
  • Continued demand from our Federal Government Agencies for secure Cloud, including from Tier 1 Agencies like ATO, gives great confidence for future growth in the Government Business. Accordingly, there will be further investment in expansion in Canberra and our Cloud platform, with an increase in Opex of around $1.5m.

Macquarie Telecom ramps up Sydney data center capability with A$80m expansion, new colo facility build

Macquarie Telecom has flagged a A$80 million expansion of its existing Macquarie Park Intellicentre to a 43MW Campus, including a new colocation data centre, as part of a push to meet the rapidly growing needs of global hyperscale and cloud specialists as well as key enterprise and government customers.

The move will comprise several stages with phase 1, the build of Macquarie Intellicentre 3 (IC3) East, set to enable the firm to expand its data centre capacity from a total load of 10MW to 26MW.  “Subsequent phases will add a further 17MW through the build-out of Macquarie IC3 West,” it added.

The expansion is driven by a focus on customer service in addition to a strategy which centers on meeting the demand of its hyperscale and cybersecurity customers.

“Our entire business has unique customer service that is simply unequalled in the industry – recent reports from the TIO and others highlight how poorly many of our competitors are faring here,” a Macquarie Telecom spokesperson told Telecom Times.

“As businesses and government organisations enter their next phases of cloud investment and new technologies, they need this high level of local support,” the spokesperson added.

The company expects that the initial capital expenditure on the Intellicentre 3 East Data Centre will be approximately A$75-80 million, the bulk of which will be incurred across calendar year 2019.

“This capex will be partially offset by a fee from Keppel DC REIT to the value of A$26-36m for the development of IC3 (East) core and building shell,” said Macquarie Telecom, adding that it will enter a 20-year lease with Keppel including options to renew.

The data centre development will be funded by structured debt financing due to be finalised in Q1 FY’19.

“The investment in IC3 fulfils our ‘build or buy’ promise at the beginning of the financial year in terms of capacity planning for our cloud services and hosting business, but there is plenty more activity underway,” the spokesperson added. “For instance, in our telecoms business unit we are focused on our recent NBN deal and for government customers we continue to focus on security and cloud. We’ll provide more information on what’s coming next for the company when we announce our FY18 in the coming weeks.”

The  firm expects the first data hall in the new Intellicentre Campus to be completed in late calendar 2019, with an opening day mechanical, electrical and plant of 2.4MW. “Further investment in MEP will be funded by the debt facility,” it said.

“The investment will leverage not only the physical investment already on the site, but Macquarie’s 18-year track record of data centre experience, industry-leading customer service, carrier neutrality and commercial flexibility,” Macquarie Telecom Group CEO David Tudehope said.

Macquarie Group Executive David Hirst said the new data centre will be a Tier III+ facility with an Australian leading PUE of 1.28. “It will be certified by Uptime Institute, built to meet Australian Government physical security standards, ISO 27001:2013, and support the delivery of credit card payment environments,” he said.

Macquarie Telecom bags A$100m NBN contract to deliver business-grade voice, data capabilities

Macquarie Telecom has signed a six-year agreement valued at more than A$100 million, with NBN Co, to provide telecommunications and data services to Australia’s business community.

The deal – which will see the enterprise telco creating 50 new jobs – combines NBN Co’s purpose-built network infrastructure with Macquarie’s stand-out customer service standards.

Macquarie Telecom billed ‘Business class NBN by Macquarie Telecom’ as a highly-specialised, dedicated offering.

Key features include:

  • Access to Macquarie’s full portfolio of voice, internet, data and SD-WAN products designed for business, delivered over NBN Co’s Multi-Technology-Mix, including fibre builds on customer request
  • Dedicated Australia-based NBN service delivery, assurance and support staff
  • Coast-to-coast access to all sites in Australia, unlocking the potential of businesses no matter where they choose to operate.

“Australian organisations have long demanded greater capability and value than they have traditionally received from last century telcos; they want services and support to match their innovative ambitions,” said  Macquarie Telecom Group executive Luke Clifton. “Business class NBN by Macquarie Telecom combines NBN Co’s national infrastructure with our superior technologies, like SD-WAN to deliver to these demands.

“[It] elevates Macquarie to tier one telco status,” said Clifton.

tto“Our partnership is an opportunity for customers to develop their NBN-readiness plan with our help. The NBN access network will touch every business in Australia now or in the near future,” he said.

“Those organisations which capitalise will have a future-proof investment through which they can meet today’s business needs, while securing long-term choice for their organisations. We’re taking an untelco, proactive approach to the NBN access network, where other telcos are using it as a last resort and not putting customers first.”

Business class NBN by Macquarie Telecom will feature NBN Co’s suite of business grade products, including asymmetrical (TC4), symmetrical (TC2) and Enterprise Ethernet capabilities, delivered over a virtual network-to-network (v-NNI) link.

Macquarie’s NBN services will be available to all new and existing customers – comprising the Australian corporate sector – and will be managed by Macquarie’s dedicated and locally-based NBN support team, creating 50 new jobs in the process as part of the deal.

“We welcome today’s announcement from Macquarie to launch business-grade services through the NBN access network and look forward to working with the company to deliver to Australian businesses,” said NBN chief customer officer Paul Tyler.

“Our multi-technology model also provides us with the flexibility to deliver the rollout at scale and pivot the mix of our access technologies where it makes sense in order to support organisations with higher bandwidth requirements,” said Tyler. 

“High-speed connectivity has been prohibitive for many businesses in the past, especially in outer metro or regional centres,” said Clifton.

“Price gouging has been common. Access to cloud and internet-based applications has been near-impossible for some,” he added. “The rollout of the NBN access network brings real competition to these markets for the very first time, allowing our customers to realise the benefit of the NBN Co’s investment in its networking infrastructure.”