Megaport announced strong half-year results and operational updates

Information Technology company, Megaport Limited (ASX: MP1) published its FY 2019 first-half earnings for the period ended 31 December 2018 along with the general market update.

The Group’s revenue for the period is reported at $15.2 million, up 72% compared to the Half-Year ended 31 December 2017 ($8.8 million). Also, the Monthly Recurring Revenue (MRR) for December 2018 was $2.7M, an increase of $1.1M or 70% from December 2017.

In December 2018, Megaport achieved 1,277 customers across 386 Enabled Data Centres in 82 cities. Of these data centres, 78 were in the Asia Pacific, 209 in North America, and 99 in Europe. In 1HFY19, Total Services witnessed an increase by 2,168, or 33%. The average Revenue per Port increased to $812 in December 2018 i.e. 13% growth from June 2018. 

In North America, Monthly Recurring Revenue (MRR) witnessed a growth of $1.0M, up by $0.6M or 144% from December 2017. The growth in services is an indicator of overall customer usage on the network. Increased services per Port drove greater MRR growth and increased revenue per Port. The average revenue per port in June 2018 was $720 which grew up to $812 by December 2018.

Average direct network cost per data centre per month was $7.4K in 1HFY19 (up 4% compared to 1HFY18 after excluding 100G network costs). The capital was invested in rolling out additional data centres globally, network expansion, and software and product development. The cash held by the company as of 31 December 2018 was $38.1M. The profit gained after direct network costs was reported at $4.8M, an improvement of $2.7M or 131% as compared to $2.1M in 1HFY2019. However, the company reported $16.6M net loss for the half year.

The Net tangible assets per ordinary share on 31 December 2018 was 47.34 cents compared to 24.81 cents on 31 December 2017.

The company also announced today, that it had appointed Mr Peter Hase as its Chief Commercial Officer, effective 12 February 2019. Mr Simon Moore, the x`current Chair of the Audit and Risk Committee, would be appointed as the Lead Independent Director of the Company, effective 12 February 2019.

Mr Jay Adelson has been appointed as a Non-Executive Board Member, effective 1 March 2019. Mr Adelson will also be Chair of a newly formed Innovation Committee to drive Megaport’s product and technology roadmap. He co-founded Equinix (NASDAQ: EQIX) in 1998 and was responsible for the original and sustaining business model that grew it into one of the largest data centre companies in the world. He was instrumental in the establishment and operation of the original Palo Alto Internet Exchange for Digital Equipment Corporation in 1996.

Megaport’s vision is to revolutionise global connectivity. Megaport’s platform uses Software Defined Networking to enable customers to connect to over 300 leading service providers in a flexible, on-demand, and cost-effective way.

During the Half-Year ended 31 December 2018, Megaport continued to expand its Network footprint to new cities while deepening its reach within existing metros. MP1 collaborated with varios data centre operators including DataBank, DataMSP, Cavern Technologies, and STT GDC, and expanded its collaboration with EdgeConnex.

The stock of the company zoomed up by 6.42% post releasing positive business, operational and management updates. It closed the day’s session at A$3.980 on 12 February 2019/.


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