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Amcom reports 50% profit jump

Perth-based fibre network provider Amcom has reported a 50 per cent jump in full-year net profits, which have risen to $25.9 million on the back of its recent divestment of shares in iiNet.
Written by Josh Taylor, Contributor

Perth-based fibre network provider Amcom has reported a 50 per cent jump in full-year net profits, which have risen to $25.9 million on the back of its recent divestment of shares in iiNet.

Excluding the $4.3 million made from the sale of Amcom's 20.4 per cent stake in iiNet, and the $7.8 million the company made from its share of iiNet's profits prior to the sale of the shares, Amcom's profit was $13.8 million to the year ending 30 June 2011, up from $10.6 million the previous year.

The data networks company bought into iiNet back in 2006, but decided to sell off its shares earlier this year, with Amcom stating that it wanted to focus on its own corner of the telecommunications market.

The company reported a revenue increase of 38 per cent to $87.2 million and also saw an increase in earnings before interest, taxes, depreciation and amortisation (EBITDA) of 29 per cent to $28.8 million.

Amcom CEO Clive Stein put the increase in profits down to strong demand for the company's fibre and cloud services.

"Amcom's focus on always striving to improve the value proposition of its product offerings and an embedded customer service culture sets us apart from our competitors and results in us continuing to deliver attractive shareholder returns. Our ability to now offer a comprehensive suite of hosted IT solutions in the emerging cloud computing market will drive the next growth phase in the evolution of Amcom," he said in a statement.

 

The company also recently scored a major $9 million cloud deal with the University of Western Australia to provide hosted servers, storage and backup from its datacentres in Perth, with the hundreds of servers and over 400TB of storage connected to the university via Amcom's 10-gigabit fibre network.

"It demonstrates our ability to be highly competitive for enterprise clients in the cloud space and validates our innovative service-driven culture. Our core fibre business is performing exceptionally well, and we are now ideally positioned to exploit the rapid growth of the emerging cloud services market," Stein said of the deal.

Although the company's fibre business for corporate, government and telco customers performed well, its residential broadband business, Amnet, suffered a 7 per cent decline in revenue from $12.2 million to $11.3 million in 2010 and an EBITDA drop of 30 per cent from $2.6 million to $1.7 million. The company has cited increased competition in the market as the reason behind this decline.

 

Amcom said it expects to deliver a double-digit percentage growth in net profit in the next financial year.

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