Insights

NEXTDC (ASX:NXT) share price on watch after strong half and guidance upgrade

The NEXTDC Ltd (ASX:NXT) share price could be on the move tomorrow after delivering a strong half year result and upgrading its guidance…
The post NEXTDC (ASX:NXT) share price on watch after strong half and guidance upgrade appeared first on The Motley Fool Australia. –

nextdc share price

All eyes will be on the NEXTDC Ltd (ASX: NXT) share price on Thursday.

This afternoon the data centre operator released its half year results following the market close.

How did NEXTDC perform in the first half?

NEXTDC was a very strong performer during the first half thanks to the accelerating shift to the cloud. This has led to a sharp increase in demand for capacity at its data centres.

For the six months ended 31 December, NEXTDC reported a 27% increase in data centre services revenue to a record $121.6 million.

This was underpinned by a 33% lift in contracted utilisation to 71MW, a 16% lift in customers, and a 16% rise in interconnections.

In respect to earnings, NEXTDC delivered a 29% increase in earnings before interest, tax, depreciation and amortisation (EBITDA) to $65.7 million.

Also growing very strongly was its operating cash flow, which increased 219% over the prior corresponding period to $64.1 million.

This left NEXTDC with liquidity of $1.8 billion at the end of the period.

Management commentary

NEXTDC’s Chief Executive Officer and Managing Director, Craig Scroggie, was very pleased with the half.

He commented: “We are pleased to deliver another record result in 1H21, against a more difficult economic backdrop due to the COVID-19 global pandemic. Despite lockdowns and travel restrictions the Company delivered its largest historical contracted build capacity for customers in 1H21.”

“Whilst COVID-19 has presented headwinds for many globally, it continues to be a positive catalyst for digital services and technology providers supported by our data centre platform.”

Guidance upgrade

This strong first half and the favourable trading conditions has led to NEXTDC upgrading its guidance for FY 2021. This could be a big positive for the NEXTDC share price tomorrow.

Based on current billing and contracted utilisation levels, as well as expected new customer contracts, the company now expects full year data centre services revenue in the range of $246 million to $251 million. This compares to previous guidance of $242 million to $250 million.

Whereas underlying EBITDA is now forecast to be in the range of $130 million to $133 million. This is an increase from its previous guidance of $125 million to $130 million. It will also be a 19.5% to 24.3% increase on FY 2020’s underlying EBITDA.

NEXTDC’s capital expenditure guidance remains unchanged at $380 million to $400 million.

Mr Scroggie concluded: “During 1H21 we delivered our largest construction and development backlog of sold capacity to customers on time, on budget, giving us a high degree of confidence for a full year revenue and EBITDA upgrade. Second half sales in FY21 have already exceeded our expectations and we expect further strong demand for our premium data centre services into FY22.“

The NEXTDC share price is up 46% over the last 12 months. Shareholders will be hoping this strong result drives it even higher tomorrow.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post NEXTDC (ASX:NXT) share price on watch after strong half and guidance upgrade appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!