New acquisitions, existing contracts underpin strong quarterly performance for 5G Networks
5G Networks has reported $11m of new and retained revenue in Q2.
Australian telecommunications company 5G Networks (ASX: 5GN) has reported a quarterly revenue of $11 million, buoyed by the $5.7m acquisition in August of Inabox Group (ASX: IAB) subsidiaries Anittel and Hostworks.
The company won a number of national deals during the quarter which delivered over $5m in new revenue.
It also re-signed key customers whose existing contracts had ended, resulting in an added $6m in retained revenue.
Managing director Joe Demase said the positive financial results reinforce 5G Networks’ position as a “market-leading customer experience” across platforms and services within the digital ecosystem.
“Customers are transitioning faster than ever to the cloud, allowing us to address this demand through Hostworks and 5GN cloud and data connectivity capabilities,” he said.
“Our recent wins have driven new revenue as a result of meshing new solutions such as data connectivity with managed services, and successfully leveraging the market experience and capabilities of Anittel and Hostworks.”
New deals
During the quarter, 5G Networks won significant national deals for data networks in addition to several new enterprise and government deals for cloud, hardware and managed information technology.
Mr Demase said the digital platform hosting and cloud services provided by Hostworks has positioned the company as one of Australia’s most experienced managed cloud providers.
He said a strong percentage of re-signed contracts came from the enterprise and government sectors which have been traditional areas of business for Hostworks.
ApTel acquisition finalised
The Inabox acquisition – combined with the $6m acquisition of Asia Pacific Telecommunications Group completed this month – have driven 5G Networks’ annual revenue to around $55 million, placing it in a “very strong position” to pursue new cloud, digital and data networking opportunities.
ApTel was acquired from The Deague Group – a luxury-focused private property developer established in Melbourne in 1859 and best known for the Whitehorse Towers apartment block in Box Hill, believed to be Melbourne’s tallest suburban residential development.
A final acquisition payment of $3m was enabled by a $5.5m debt facility with Commonwealth Bank.
The funds will also be used to consolidate lease obligations and bolster working capital.
The ApTel acquisition added more than 800 customers to 5G Networks’ customer base and an annualised revenue of $6.4m.
5G Networks has completed three acquisitions since listing in November 2017, via a combination of existing funds, new equity and debt.
At midday, shares in 5G Networks were trading 7.69% higher at $0.420.