UPDATED: NEXTDC forges new contract with existing partner

UPDATED: NEXTDC forges new contract with existing partner

Signs contract for another five years

NEXTDC forges new contract with existing partner

NEXTDC forges new contract with existing partner

Co-location services company, NEXTDC (ASX: NXT) has entered into an additional contract for the provision of datacentre services to a leading corporation. This partnership extends on the contracts it inked with the company on June 6, 2013 and June 29, 2015.

Consistent with previous announcements, the company has not been named due to confidentiality obligations.

According to NEXTDC, the contract is for 2MW and satisfies the previously announced options reserved by the organisation at that time (1MW at each of the M1 Melbourne and S1 Sydney sites).

The company also said, in a statement that the term of this new contract is for five years from commencement, but it also has an option to extend for a further five years.

“Revenue recognition for this 2MW option is expected to commence towards the end of FY16 and ramp up to full billing over the following 18 months. The company’s high density requirements provide NEXTDC with a further opportunity to utilise its Project Plus capacity at M1 and S1,” it claimed.

Project Plus is an engineering project NEXTDC announced on August 25, 2014, which expanded its overall IT capacity by 3MW to 15MW at M1 and by 2.5MW to 14MW at S1, without the requirement for additional land, building or fit out of additional data halls.

The company also described this partnership as a “leading corporation contract win”.

NEXTDC CEO, Craig Scroggie, said this new commitment, as well as major new contracts announced last year all continue to drive momentum across the business.

"These new contracts are also accelerating the development of our new Brisbane and Melbourne datacentres, which we announced in early December, and expect to commission in the second half of FY17. Today's announcement is as much a great technical achievement for NEXTDC as it is a commercial success," he said.

Scroggie added that the company is preparing for huge growth in 2016 with the recent announcement of an additional $220 million in capital.

"It will kick-off the first phases of our planned $400 million in infrastructure development with the new B2 and M2 facilities. This win is further proof that NEXTDC is an enabler of the digital economy. We are confident that this will be another big year for enterprise moving from owning and operating their own facilities to take advantage of co-location and Cloud computing to create their hybrid compute infrastructure platforms."

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