5G Networks shrinks losses by 63%

5G Networks shrinks losses by 63%

Reported a net loss of $1.5 million for FY20

Joe Demase (5G Networks)

Joe Demase (5G Networks)

Credit: 5G Networks

5G Networks ended FY20 with a loss but managed to improve on its losses by nearly two-thirds during the year.

The publicly-listed company reported a net loss of $1.5 million for the financial year ending 30 June, an improvement of 63 per cent compared to FY 19’s loss of $4.1 million.

Revenue from ordinary activities was also down by 3.6 per cent, to $49.3 million.

Breaking the revenue down into the company’s separate services, cloud services accounted for the biggest pull at $13.7 million, up roughly 14 per cent from FY19's $12 million.

Hardware and software meanwhile took the biggest hit, dropping approximately 48.6 per cent from FY19’s $15 million to FY20’s $7.7 million.

As for the rest of the services, managed services were at $12.8 million (down 3.5 per cent), data centres were at $7.67 million (up 88.2 per cent) and network and voice were at $7.4 million (up 9.4 per cent).

Earnings were way up, with earnings before interest, tax, depreciation and amortisation (EBITDA) rising an incredible 1229 per cent, to $4.2 million.

When considering EBITDA before acquisition costs and share option costs however, this brings the figure to $6.3 million, an increase of 96 per cent growth from the previous financial year’s $3.2 million.

In a statement to 5G Networks’ shareholders, managing director Joe Demase said the EBITDA results were “extremely pleasing” and were underpinned by a focus on cost savings and the integration of accretive acquisitions leading to several cost synergies.

Non-executive chairman Albert Cheok added the results were driven by a number of movements by the company, including new data cemtre locations in central Sydney and North Sydney.

“[This] has enabled greater market opportunities in NSW, where we have directly connected our key digital infrastructure along Sydney’s growth corridor. This opportunity will certainly grow as we continue to expand our fibre footprint in FY2021,” he said.

Also a focus for the company moving forward is its Cloud Federation, a private cloud platform, which launched in April and has garnered demand, resulting in a strong growth forecast for the financial year ahead, Cheok added.

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