NEXTDC Limited (ASX: NXT) announced its financial results for the half year ended 31 December 2017 and showed continuous growth in data centre revenue along with significant rise in EBITDA. The company is an ASX listed technology company enabling business transformation through innovative data centre outsourcing solutions, connectivity services and infrastructure management software across the Australia. The company has continued to perform good in competitive market, registering a significant increase in data centre services revenue to $72.9 Mn during 1HFY18 versus $56 Mn in 1HFY17. Net profit after tax was down by 56% to $8.4 Mn in 1HFY18 from 19.2 Mn in 1HFY17 due to higher finance cost. Non-statutory underlying earning before interest tax, depreciation and amortization (EBITDA) inclined to $33.6 Mn in 1HFY18 from $23.9 Mn in 1HFY17. Number of customers also increased, with 176 new customers i.e., 25% rise from the previous corresponding year.

During the first half of the year, the group has increased its senior debt facility from $100 Mn to $300 Mn. The company has increased its contracted utilization by 7.7 MW from 31.5 MW to 39.2 MW during the same period. Further, the company has received orders for more than 5 MW of capacity at its Sydney data centre site. Revenue recognition from these orders will commence in FY19 and ramp up to full billing is expected over the following 30 months. There has been no dividend declared by the company during the first half of the year. Looking at present condition, NXT stock price has risen by 57.8% in the past six months and moved up to 8.75% in last five days as on 23 February 2018. Looking at the price to earnings levels and trading levels, we recommend to “Sell” the stock at the current market price of $6.76
 

First Half Year Financial Performance (Source: Company Reports)

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