Total
0
Shares
Market Herald logo

Subscribe

Be the first with the news that moves the market
  • While many ASX-listers took a hit on Friday, data operator NEXTDC (NXT) managed to announce new business and hit the green
  • Shares in the company bounced by 0.9 per cent for a $8.95 finish by market close
  • The COVID-19 storm has brought NEXTDC into the spotlight, as internet providers face more demand than ever
  • Commitments at the company’s Victorian centre continue to thrive and outstanding contracts have been padded for more data usage
  • Additionally, outstanding contracted work for expansions have been upped once again, spelling out bigger revenue for the company going into 2021
  • At Monday’s market open, NEXTDC shares remain grey, selling for $8.95 per share

While many ASX-listers took a hit on Friday, data operator NEXTDC (NXT) managed to announce new business and hit the green.

Shares in NEXTDC gained 0.9 per cent for a $8.95 finish on Friday, compared to a five per cent fall across the S&P/ASX 200 index as May begins.

While COVID-19 rattles business for many others, NEXTDC has thrived as many are forced to work from home over the internet, or are simply spending more time surfing the web to kill time indoors.

The share price boost comes as the company announces new business at its Victorian data centre.

Outstanding contract commitments have been upped, with the company now poised to expand the centre by 27 megawatts (MW).

MW are the benchmark of a data centre’s capacity and power. For sake of measurement, Google’s flagship data centre operates at a minimum of 500MW.

Tallying up the new business in the pipeline, the company’s Victorian centre is poised to weigh in at 40MW after upgrades are completed.

In early March, an increase in contracted services for NEXTDC saw company expenditure upped by $40 million to a total of $300 million.

While other companies are scraping earnings to weather the COVID-19 storm, NEXTDC is charging ahead — now increasing planned expenditure by another $40 million for a total of $380 million.

NEXTDC Chief Executive Craig Scroggie labelled Friday’s news as exponential growth.

“We advised the market at the time of our recent capital raising, that the company’s sales pipeline was very strong with expectations of material customer contract wins in the near term,” he said.

“We are very pleased to have now locked in further material commitments against these expectations. The demand for our data centre services continues to accelerate and requires discipline and patience as the nexus between hyperscale capacity planning, site development, infrastructure deployment and revenue recognition can, in practice, be up to two to three years”.

The impact of the new business on revenue is expected to take shape during the second half of 2021’s Financial Year.

At Monday’s market open, NEXTDC shares remain grey, selling for $8.95 per share at 10:12 am AEST.

NXT by the numbers
More From The Market Herald

" Aurizon (ASX:AZJ) to buy One Rail for $2.35b

Aurizon (AZJ) has signed an agreement with Macquarie Asset Management to purchase One Rail Australia for $2.35 billion.
Rio Tinto (ASX:RIO)- CEO, Jakob Stausholm

" Rio Tinto (ASX:RIO) aims to half carbon footprint by 2030

Global mining giant Rio Tinto (RIO) has pledged to half its carbon footprint by 2030.
Orocobre (ASX:ORE) - CEO and MD, Martin Perez de Solay

" Orocobre (ASX:ORE) tables record Mt Cattlin production after Galaxy merger

Shares in lithium big-cap Orocobre (ORE) are trading green this morning after the company announced record production from its new Mt Cattlin mine
Lynas (ASX:LYC) - Managing Director & CEO, Amanda Lacaze

" Lynas Rare Earths’ (ASX:LYC) sales drop as COVID cases slowed production

Lynas Rare Earths (LYC) has reported a drop in sales revenue after a recent spike in COVID-19 cases in Malaysia led to a