26 Nov

2021 AGM Chairmans Address to Shareholders

MACQUARIE TELECOM GROUP LIMITED ANNUAL GENERAL MEETING FRIDAY 26 NOVEMBER 2021 at 9AM CHAIRMAN’S ADDRESS Ladies and Gentlemen, good morning. My name is Peter James, the Chairman of Macquarie Telecom Group Limited (‘the Company’), and I would like to extend a warm welcome to shareholders at the Annual General Meeting for 2021. INTRODUCTION OF THE BOARD I would like to introduce our Board of Directors: Anouk Darling – Anouk joined the Board in March 2012 and chairs the People, Remuneration and Culture Committee and is a member of the Audit and Risk Management Committee. Adelle Howse – Adelle joined the Board in August 2019 and is a member of the People, Remuneration and Culture Committee and the Audit and Risk Management Committee. Bart Vogel – Bart joined the Board in July 2014 and is the Chairman of the Audit and Risk Management Committee and a member of the People, Remuneration and Culture Committee. David Tudehope – David is co-founder and Chief Executive of Macquarie Telecom Group. Aidan Tudehope – Aidan is co-founder of Macquarie Telecom Group and is the Managing Director of the Macquarie Government and Hosting Group. We welcome our auditors PricewaterhouseCoopers represented by Shannon Maher . I would also like to introduce Michael Gold , our General Counsel & Company Secretary and also Helen Cox our CFO. Boardroom is the company’s share registry, and we have a representative here today. BUSINESS OF MEETING I will now take a moment to outline this morning’s agenda. First you will hear an address from myself and then from David. We will then go through the highlights from the year in review. Then we will proceed to the ordinary business of the meeting. After we close the meeting we will then address the questions we have received from Shareholders about the operations of the business. The procedural items for this meeting are set out in the Notice of Meeting dated 25 October 2021, a copy of which is available on the ASX platform. In accordance with the Notice of Meeting this is a physical meeting of shareholders that has been supplemented by a webcast of the meeting via the Microsoft Teams platform. Shareholders who pre-registered for the webcast have been sent a link to watch the proceedings of the meeting remotely, but are not counted as attendees and cannot vote on the resolutions except by proxies received by 9.00am on Wednesday. The Company asked that Shareholders submit any questions in advance of the meeting. We will accept questions from shareholders in attendance today, and to the extent practical to the proceedings of the meeting, we will review any questions submitted online, which can be done via the chat function on the online platform, or by emailing AGM@macquarietelecomgroup.com. All of the materials that we are going through today have been uploaded onto the ASX platform. ORDINARY BUSINESS We will consider three items of ordinary business: 1. The receipt of the financial statements and accompanying reports for the period ended 30 June 2021; 2. The adoption of the remuneration report for the year ended 30 June 2021; and 3. My re-election as Non-Executive Director. OTHER BUSINESS There has been no notice of other business validly given by any member under the Corporations Act 2001 . NOTICE OF MEETING The notice of meeting was sent to all members. I will take the notice of meeting as taken as read. MINUTES OF THE PREVIOUS GENERAL MEETING The minutes of the previous general meeting of members of the Company, which was the Annual General Meeting held on 27 November 2020, have been approved by the Board and signed by the Chair. The original minutes are tabled and are available for inspection by any member wishing to see them. And now to the Chairman’s Address: This is my eighth AGM as Chairman and I am pleased to report on the seventh successive year of strong performance and EBITDA growth of Macquarie Telecom Group. Key Business Highlights Our continued focus on providing an outstanding customer experience has driven an increase in revenue of 7% to $285.1 million and EBITDA by 13% to $73.8 million compared to the previous financial year. Macquarie Telecom Group delivered a net profit after tax from continuing operations of $12.5 million a decrease of 7% on 2020, due to the increase in depreciation on capital investments from the Company’s strategic investments, customer growth assets and data centres. The Group also proved to be resilient during the COVID-19 pandemic, due to our diversified and high- quality customer base. Group financial performance Over the last three years the Group has achieved a Revenue CAGR of 6.9% and an EBITDA CAGR of 15.6%. For the first time in FY21, the Hosting segment has been split into the Cloud Services & Government and Data Centre segments. The Cloud Services & Government segment contributed $131.5 million in revenue, an increase of 21% compared to the prior year, and EBITDA of $36.4 million, an increase of 25%. The segment continues to leverage investment in our hybrid IT strategy to deliver solid customer growth. The Data Centre segment contributed $38.7 million in revenue, an increase of 10% compared to prior year, and EBITDA of $18.9 million, an increase of 12%. The segment achieved major milestones during the year with the completion of Intellicentre 3 East at the Macquarie Park campus and Intellicentre 5 South Bunker at the Canberra campus. This significant investment in infrastructure will ensure our Data Centre business is well placed to benefit from rising demand as more organisations move to the cloud. The Telecom segment remains an important contributor to the Group’s service offering, delivering $135.1 million in revenue and EBITDA of $18.5 million. While lower than the prior year, this performance reflects a complex operating environment with customers transitioning away from the office to more flexible ways of working, impacting higher margin voice usage and access lines. To support business development, our focus on SD-WAN technology will facilitate new revenue growth opportunities, and our great customer experience remains compelling in customer acquisition. Balance sheet and cash flow EBITDA performance for the year resulted in operational cash flows of $45.3 million. The Company finished the year with a robust balance sheet position, having $19.8 million in cash and cash equivalents and a $58 million available in its working-capital facility. We invested heavily in our data centre developments during the year, as well as across all four business units. Investment for future growth saw total capital expenditure of $139.1 million in the fiscal year 2021. As previously announced, during this significant capital-intensive growth investment phase, the Company has ceased paying dividends. Outlook EBITDA will continue to grow in FY22. Due to investments being made in Data Centres and Cloud Services & Government the EBITDA growth will be in the second half of the fiscal year. We will continue to develop public cloud capability to enhance the current hybrid cloud offering. We see strong demand for cyber security in our Government and Cloud Services businesses and will be making significant investments in FY22 to realise this opportunity. Macquarie Data Centres is investing in new staffing and technology ahead of revenue from our leading corporation contract win. Billing is due to start shortly after completion in the first half of FY22. Telecom revenue and EBITDA will continue to be affected by COVID lockdowns, which reduce the office based higher margin voice usage and access lines. This is partially offset by demand for new technologies including SDWAN. In conclusion, ladies and gentlemen, the Company has had an outstanding 2021 fiscal year and we enter the new financial year confident we will continue to leverage our investments to drive further shareholder value and ongoing returns. I would like to thank the Board and Management team for their significant contribution and also the many dedicated and hardworking employees of Macquarie Telecom. I will now hand over to David Tudehope, Chief Executive of Macquarie Telecom Group.

More from Macquarie Telecom Group

Join Listcorp to create a personalised news feed, follow your favourite companies, save useful news, and more.

By joining Listcorp you agree to our Terms & Conditions and Privacy Policy

Information on this Website is provided for general information purposes only and is not a substitute for professional advice. ASX Information (including company announcements and prices) is delayed by at least 20 minutes. JSE Information (including company announcements and prices) is delayed by at least 15 minutes. Reliance on the information you access on or from this Website is solely at your own risk. We make no representation or warranty in relation to the future performance of the companies that appear on this Website. Investment in securities involves risk and you should obtain independent professional legal, financial, investment or company advice before acting on any of the information you access on this Website. Using, browsing or otherwise accessing this Website is subject to our Terms and Conditions and our Privacy Policy.

© 2021 Listcorp. ABN 60 166 140 307

Never miss news from Macquarie Telecom Group (ASX:MAQ) when you join Listcorp.