Pipe Networks records $16.6m profit

Indefeasible Rights of Use, PNG Spur sales and ForEx gains drive result

Pipe Networks (ASX:PWK) has announced financial results for the six months to 31 December 2009, recording $16.6 million in profit, a 201 per cent increase over the previous half result of $5.5 million.

The company also recorded revenue of $55.4 million, 130 per cent up from the $24.1 million recorded for the six months to 31 December 2008.

The company also recorded an EBIDTA of $35.1 million, up from $9.3 million for the six months to 31 December 2008.

Pipe chief executive officer, Bevan Slattery, said the results were underpinned by solid demand brought on by the October 2009 completion of the company’s PPC-1 submarine cable system.

In an ASX statement, Slattery said domestic operations contributed $29.8 million in revenue and $6.5 million net profit after tax (NPAT) in the first half of FY10.

International operations contributed $25.7 million in revenues and $10.1 million NPAT based largely on the sale of Indefeasible Rights of Use to foundation customers, the sale of its Papua New Guinea spur and foreign exchange gains, Slattery said.

“The PPC-1 leasing customers contributed minimal revenue and NPAT contribution in the first half as the submarine cable system was only completed October 2009, however it is expected to make solid contributions in the second half of FY10,” he said.

“Furthermore, our strong cash management contributed $1.5 million of net fair value gains from financial assets which the company recently invested in.”

In late December 2009, TPG Telecom (ASX:TPM) said it had secured the money it needed to go ahead with its merger with Pipe Networks. Earlier in the month, Pipe said it had picked the Equinix data centre in Sydney as an interconnect provider for the recently launched PPC-1 undersea cable.

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