Image source: © 2025 Krish Capital Pty. Ltd.

Highlights

  • Expansion works at SYD1 underway to deliver additional high-density capacity by mid-2026
  • Growth capital expenditure projected at AUD 160-180m, funded through cash and debt facilities
  • Group billed IT capacity expected to reach 85MW by July 2026, with run-rate EBITDA of AUD 180m

DigiCo Infrastructure REIT (ASX:DGT) owns, operates and develops data centres in Australia and North America. Its portfolio includes 13 sites with 238MW of planned IT capacity, comprising 76MW installed and 162MW under development.

DGT announced new customer agreements across its Australian platform, covering Hyperscale, Neocloud, Enterprise and Government clients. The majority of these signings are located at the SYD1 site, with additional contracts secured in Brisbane and Adelaide.

These agreements are expected to lift contracted IT capacity in Australia to 41MW by June 2026, above the previously disclosed run-rate target of 27MW for the same period. This also marks an increase from 21MW reported in June 2025.

Expansion Plans at SYD1

To meet demand for larger and denser deployments, DigiCo has accelerated the expansion of its SYD1 facility. The company is reshaping and extending the original 9MW project to deliver additional high-density capacity by mid-2026.

Construction work at SYD1 has already commenced, supported by 120MVA of allocated power. Preparations are also underway to advance further capacity additions during FY27.

FY26 Earnings Guidance

Revenue from the newly secured contracts is expected to begin phasing in during the second half of FY26. Taking into account this schedule, along with the planned remixing of contracted capacity at SYD1, DigiCo provided updated earnings guidance for FY26.

 The company forecasts underlying EBITDA in the range of AUD 120-125m, with growth capital expenditure projected between AUD 160-180m, to be funded through existing cash reserves and undrawn debt facilities.

Distributions are expected to total 12c per security, representing 90-100% of forecast FFO. Looking ahead, Group billed IT capacity is anticipated to reach at least 85MW by July 2026, consisting of 44MW in North America and 41MW in Australia.

Following the full phasing of these commitments, contracted billings are expected to equate to an annualised run-rate EBITDA of at least AUD 180m.

Management Commentary

Chief Executive Officer Chris Maher said, “As we noted at our FY25 results, the Australian pipeline, customer demand and scale of deployments has continued to track ahead of expectations at the time of the IPO in December 2024. DigiCo is uniquely positioned to meet surging demand for high-density AI infrastructure - where performance, latency and connectivity are critical. As a result, we are targeting accelerated delivery of the full 88MW SYD1 D&O project earlier than expected, and have reshaped our FY26 works program to deliver additional capacity sooner and capture this growth.”

Share Performance

The stock is currently trading at AUD 3.110 per share, up by 13.919% from its previous close of AUD 2.730