Macquarie Technology Group released their results after hours yesterday, from their presentation:
Once again operationally a very solid result with continued growth in all segments of the business.
Data centres now comprise 11% of total revenue but amazingly contribute 32% towards total EBITDA. The slide below shows the incredible margins of the data centre business:
Telecom revenue actually declined compared to FY22 however EBITDA increased due to operational efficiencies. Long term I don't see telecom being a major segment of the business but it is profitable at present and does contribute 20% towards overall EBITDA.
Capital expenditure which was forecasted to be $76m-$80m ended up being $65.8m. I suspect this may be due to ongoing delays with their IC3 Super West build which has once again been delayed. IC3 Super West was due to be approved mid 2023 but is now expected late calendar 2023. The build will also now take 30 months, up from 18-24 months from the last report. Total load of IC3 Super West has been upgraded to 38MW with potential to increase to 45MW if needed.
Outlook for FY24 was given:
As expected, Capex will increase in FY24 due to (hopefully) the build of IC3 Super West. On a cash flow level, they shouldn't have any issues given that they raised capital last year and repaid all of their debt. The company also generated free cash flow of around $43m (if you back out the cash they placed into Investment Accounts). There is still the potential to use the debt facility which has a capacity of $190m.
Doing some rough numbers based on their outlook. Say EBITDA grows to around $110m, then assuming around $58m depreciation, there is a potential for MAQ to generate NPAT of between $30-35m.
Disc: Held IRL and on Strawman