Vocus doubles Southern Cross Cables capacity

Vocus has doubled the capacity it uses on the Southern Cross subsea cable, extending an existing agreement until 2025.

The ASX-listed wholesale transit provider said today that the US$12.9 million capacity upgrade was agreed on January 1 and that a five-year extension to 2025 was agreed 10 days later.

The extended agreement provided Vocus a "secure entitlement to use and on-sell the acquired capacity for the period of the [agreement], ending November 2025, being the estimated useful life of the cable," the company said.

Chief executive James Spenceley told iTnews that data was "leading the way" for growth.

Vocus reported a $3.68 million after-tax profit for the first half of financial year 2011, built on revenues of $13.9 million.

Data sales for the half were approximately $9.54 million while voice sales were $4.2 million, both significantly up year-on-year.

The company had also pursued a de-risking strategy with respect to its major customers, with its top customer now contributing about 15 percent of external revenue (previously 24 percent and two customers).

"We've focused on broadening our customer base as we've [launched] new products," Spenceley said.

"Equally, we'd like to de-risk the business as much as possible".

Vocus now has 136 customers and Spenceley said that growth had continued in a "linear" fashion in the past half-year.

Vocus also reported that its recently-acquired E3 Networks' data centre business contributed revenues of $380,743 in the period 12 November to 31 December 2011.

"Had the business been held for the entire half-year, contributed revenues would have been in the region of $1,400,000," Vocus said in financial statements.

"[But] due to significant integration changes within [E3], it is not practical to provide a meaningful profit for entire financial half-year."

Spenceley told iTnews that the integration changes related to documenting policies and procedures and "having a reasonably large-[company] approach to running data centres".

He said that Vocus was also focused on cross-selling services between its customer bases.

Almost one in five data centre customers had taken transit services, pointing to the early success of Vocus' strategy, Spenceley said.