Data Exchange Network expects $4M hit to sales

Data Exchange Network expects $4M hit to sales

Revises sales from $12M to $8M as customers feel the impact of COVID-19

Data Exchange Network modules

Data Exchange Network modules

Credit: Data Exchange Network

Publicly listed pre-fabricated modular data centre specialist Data Exchange Network (DXN) is expecting a $4 million hit to its sales pipeline thanks to the impact of COVID-19.

In February, the business expected sales to sit at around $12 million, but this has now been revised to $8 million as prospective customers deferred decisions in relation to capital expenditure commitments due to the impact of the coronavirus pandemic.

Full year revenue for DXN is expected to sit at $5 million, a $3.6 million increase from FY19.

In May, DXN completed the purchase of assets and revenue of Data Centre 3 (DC3) in Hobart, which will generate a minimum $860,000 in revenue per annum for three years, bringing total colocation contracted sales to about $3 million.

At the time of announcing the purchase in February, DXN CEO Matthew Madden said that the agreement includes the assets and customer revenue of the data centre and stands as an example of how his company will deliver on its vision to be Australia’s ‘leading edge data centre operator’.

“Our plan is to continue to expand our carrier neutral edge data centre footprint in Australia and New Zealand,” Madden said.

“This target will be achieved by developing new greenfield modular data centres, such as our new Sydney DC and/or acquiring existing operating data centres such as DC3.”

The deal includes the requirement that TasmaNet signs a national customer agreement with DXN with a minimum commitment of $860,000 per annum for three to five years. 

As such, TasmaNet said it would continue to offer a suite of data centre, cloud and backup services to its customers utilising DC3 (which it will continue to manage), with DXN becoming a wholesale data centre provider to TasmaNet.

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