SA’s Uniti goes from start-up to juggernaut in two years with profit haul
An Adelaide company has gone from a loss-making startup two years ago to a profitable business juggernaut with three acquisitions in six months.
SA Business
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SA-born telco Uniti has reported a $15.9m profit, a turnaround from a $13.5m loss previously, on the back of three acquisitions in six months.
Underlying net profit – excluding costs related to its buyout of 1300 Australia, LBNCo and OPENetworks – also came in strong at $21.7m, compared to the loss of $7m in FY19.
“FY20 has seen Uniti Group completely transform from a loss-making, fledgling start-up to a highly profitable, diversified and growing organisation, with the platform set for further marked expansion over the coming years, chief executive Michael Simmons said.
Uniti said it was buying Victorian rival OptiComm in June this year, a deal that will potentially double its value when it is completed in October, subject to shareholder and other approvals.
“The acquisition of OptiComm will be transformational in earnings contribution and increase in market capitalisation,” Mr Simmons said.
“Subject to market conditions, we are hopeful Uniti will transform to a billion dollar market capitalisation and we see our entry into the ASX200.”
The deal is expected to increase the company’s fibre network build capacity and strengthen its fibre to the premises market position while potentially doubling earnings.
Mr Simmons was proud the company had grown through the COVID-19 crisis with no financial contributions from the JobKeeper scheme.
“This is evidence we are building a business with highly defensive qualities …” he said.
Uniti will be able to pursue further market growth opportunities, which will increase earnings, Mr Simmons said.
Formerly known as Uniti Wireless, the business was founded in SA by Che Metcalfe and Sasha Baranikow and listed on the Australian sharemarket in February 2019. Mr Metcalfe and Ms Baranikow were sacked two days later. Since its listing Uniti has also bought Fuzenet, FoneDynamics, CapitalFibre Networks and Clublinks.
Revenues to the end of June 30 came in at $58.2m, up 306 per cent on the previous year.
Uniti shares closed six per cent lower at $1.54 on Monday.