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Scroggie in the fast lane as NEXTDC cashes in on global data wave

Business

Data centre owner NEXTDC is tipping underlying earnings growth of up to 24 per cent and investment of $400 million as the company takes advantage of a huge, global surge in demand for web services.

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Chief executive Craig Scroggie, known for his love of fast and expensive cars, has outlined a booming period for the company, founded by Brisbane’s tech guru Bevan Slattery and now in the ASX 100 and valued at $6 billion.

And Scroggie said “slow is the new downtime” when it came to internet speed, and data had become the world’s most valuable commodity. He said  investment was about to boom in cloud spending by about $76 billion in Asia and the Pacific over the next to years and $500 billion globally. Spending in Australia is now about $4 billion a year.

“In the past 12 months, NEXTDC has once again set new benchmarks with a capital development program that exceeded 2019’s record levels,” Scroggie said.

“The first of our third generation data centres, which is already in the build phase, will form a critical enabler for organisations to keep pace with future growth of cloud and data as they accelerate their transformations,” Scroggie said.

He said the company had experienced a strong start to 2021 with data centre services revenue growth of between 21 per cent and 25 per cent.

“The top end of that guidance represents a $250 million data centre services revenue stream with strong growth in recurring data centre services revenue,” he said.

“We are on track to deliver growth in our underlying EBITDA (earnings before interest, tax, depreciation and amortisation) in the range of 20 per cent to 24 per cent, now increasingly driven by the performance of our second-generation facilities as cusomter utilisation ramps up.

He said the company would invest about $400 million in new infrastructure to meet customer requirements.

Scroggie said an information explosion was occurring and forecast to accelerate exponentially as a result of cloud computing, the “internet of things”, 5G and artificial intelligence.

“We play a pivotal role in this new, fourth industrial revolution where technology is being built upon technology,” he said.

 

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