Highlights

  • NEXTDC met both financial covenants at 30 June 2026 and expects to comply again on 31 December 2026.
  • Pro forma interest cover reached 5.91 times against a 1.5 times minimum, with gearing at 8.2 per cent.
  • The calculation excludes contracted EBITDA and potential service level credits for affected M3 Melbourne contracts delayed by grid supply.
  • Cash of A$1,275 million and undrawn facilities gave total liquidity of A$8,675 million at 30 September 2026.

5.91 times. That is the pro forma interest cover ratio NEXTDC Limited (ASX:NXT) reported in a covenant compliance and headroom summary on 28 October 2026, against a minimum of 1.5 times. The data centre operator said it complied with both financial covenants at its half-yearly test on 30 June 2026 and expects to comply at the next test date of 31 December 2026.

The two ratios

The interest cover figure includes the 73 megawatts of additional contracted utilisation announced on 21 July 2026. Gearing was 8.2 per cent as certified, against a maximum of 60 per cent. The company said the pro forma interest cover figures are unaudited, not certified and not a forecast.

How the ratio is built

The calculation uses A$262.1 million of EBITDA before contracted EBITDA and A$444.0 million of pro forma contracted EBITDA, giving covenant EBITDA of A$706.0 million. Net interest expense is A$119.5 million. Covenant EBITDA needed to meet the minimum is A$179.2 million, which the company says leaves headroom of A$526.8 million before the ratio reaches the minimum, with interest unchanged.

For gearing, net senior debt was A$834.3 million and total assets at book value were A$10,182.3 million. Contracted EBITDA is included for contracts expected to start billing within 24 months of the test date. The covenants are tested each 30 June and 31 December for the Australian group only, under a Common Terms Deed Poll dated 3 November 2024 that covers all senior loan facilities.

The M3 Melbourne exclusion

NEXTDC excluded contracted EBITDA and potential service level credits for the affected M3 Melbourne customer contracts. The cause is grid supply delays, with the first increase dependent on works by Jemena Electricity Networks (Vic) Ltd, which the company currently expects during the 2028 financial year. Treatment of any service level credits is uncertain and could be one-off items or a rental reduction under lease accounting standard AASB 16. Other M3 contracts, which are operational, are unaffected.

Liquidity and debt structure

At 30 September 2026, NEXTDC held cash of A$1,275 million, undrawn senior debt of A$6,700 million and undrawn Hybrid Securities B of A$700 million, for total liquidity of A$8,675 million. Senior debt facilities total A$8,700 million, of which A$2,000 million is drawn, across eleven revolving and term facilities maturing from December 2029 to September 2033.

Subordinated capital has a limit of A$3,550 million, of which A$2,850 million is drawn. That comprises A$750 million of floating-rate subordinated notes due 30 April 2030, A$1,100 million of 1.75 per cent convertible notes due 2031 issued on 17 September 2026, and A$1,000 million of Hybrid Securities A issued on 15 May 2026. Convertible noteholders may require redemption on 17 September 2029. The undrawn A$700 million Hybrid Securities B tranche can be drawn until 15 May 2027. Subordinated capital is excluded from the maintenance covenants but subject to an incurrence test requiring adjusted gearing of no more than 85 per cent.

Limits of the measures

NEXTDC cautioned that the ratios do not measure how much debt it can draw. Drawing undrawn facilities while staying in compliance depends on drawdown timing and the billing profile of its contracts. Statements on grid timing, billing, EBITDA and covenant compliance carry material risk, and actual results may differ.