Modular sales pipeline growing strongly – Research as a Service (RaaS)
DXN Ltd (ASX:DXN) is a vertically integrated prefabricated modular data centre business with manufacturing facilities in Perth and its own data centre, SYD01, at Sydney Olympic Park in Sydney. In Q2 FY20, the unweighted sales pipeline for DXN’s modules division grew 243% to $377m.
Work in hand for the modular division has increased to $7m following the signing last month of the $0.7m contract to build Australian Gas Infrastructure Group (AGIG) a modular data centre in Perth and a $75k Synergy maintenance contract. DXN announced Q2 cash receipts of $0.66m and cash costs of $3.5m. The company anticipates Q3 cash receipts of $1.6m and cash outgoings of $3.6m. In our view, the AGIG contract cements DXN’s position as a leading manufacturer of Edge data centres. We anticipate DXN will accelerate its strategy of building Edge DCs for both third parties and for its own regional opportunities over the coming quarters and to build significant recurring revenues with maintenance contracts.