MacTel fingers Vodafone over mobile revenue fall

Macquarie Telecom has fingered Vodafone's much-publicised network issues for a drop in mobile service revenues in the past financial year.

Construction of Macquarie Telecom's now-finished Intellicentre 2 facility.

The business telco and data centre operator posted an overall net profit after tax of $19.6 million for FY12, a 10.6 percent rise over FY11.

The result was built on a mixed bag of revenues but buoyed by higher margins and earnings before interest, taxes, depreciation and amortization (EBITDA).

Macquarie Telecom said in financial filings (pdf) that mobile revenue fell from the almost consistent $28 million it had seen for FY09 to FY11, to $21.7 million FY12 - a fall of just over 23 percent.

It blamed the reduction in mobile revenues on the "impact of Vodafone network issues in fiscal 2011".

Vodafone's problems led to a major upgrade of its network. Macquarie's mobile service is powered by Vodafone's network, according to the firm's website.

Fixed voice revenues also slid year-on-year, due to "further price competition and fixed-to-mobile and data substitution". Revenues were $76.2 million in FY12, compared to $86.4 million in FY11 - an almost 12 percent reduction.

Data revenues grew 5.5 percent year-on-year to $62.4 million.

Data, voice and mobile revenue combined, Macquarie Telecom finished FY12 with $160.3 million in revenue, representing a 7.7 percent year-on-year decline in fortunes.

The revenue falls did not impact EBITDA. Macquarie Telecom saw an overall 8.9 percent year-on-year increase across its telecommunications portfolio to post EBITDA of $31.2 million.

And EBITDA margins in the telco business climbed from 16 percent in FY11 to 19 percent in FY12.

"Strict cost control and automation has contributed to improved margins in the telco business," the company said.

Hosting limelight

In revenue terms, Macquarie Telecom's major bright spot was in the hosting side of the business, where revenues climbed 9 percent year-on-year to $58.5 million.

The hosting business is approaching a point where it has almost doubled in revenue terms since FY09, when it was $33.9 million.

Hosting EBITDA came in at $15.3 million, up 5.9 percent year-on-year "despite the impact of significant operating investments" in its now-open Intellicentre 2 data centre and in cloud services.

The company said its offerings of "managed private and public clouds" were "gaining traction".

It also said it would focus on winning more government tenders in the current financial year.

Capital expenditure

CapEx for FY12 came in at $51.9 million. The big ticket item was the Intellicentre 2, where $27 million was invested in "building construction, maintenance and electrical fit out".

A further $7 million was allocated to "software implementation and development, and data centre networking". The rest went on business-as-usual expenses.

In FY13, capital expenditure is expected to come in much lower at approximately $34 million, of which about $14 million has been allocated to expanding hosting capability.