TeleCity Group Reports Solid Growth

TeleCity Group, the European provider of network neutral colocation services, today reported solid growth as it announced its financial results for the year ended December 31, 2010. The company said it will continue to pursue opportunities for growth, which could include entering new markets or adding growth capacity in existing markets.

Revenue was up 15.9 percent, compared to 2009, to £ 196.4 million ($314 million). On a same currency base, TeleCity achieved a 17.7 percent growth rate. Adjusted EBITDA increased 30.5 percent to £ 83.4 million ($133.4 million), from £63.9 million in 2009 ($102.2 million). Adjusted EBITDA margin increased to 42.5 per cent, compared to 37.7 percent in 2009. The company delivered an adjusted profit, before tax, of £ 51.4 million ($ 82.2 million), up 45 percent compared to 2009.

“The Group achieved excellent results, with strong growth in revenue, adjusted EBITDA, EPS and operating free cash flow,” said Michael Tobin, TeleCity Group CEO. “We also secured a substantial amount of additional capacity in key European internet hubs, which will enable us to meet our customers’ demand for highly-connected capacity as the digital economy grows.”

The company reiterated its intention to pursue both organic growth and acquisitions, either for the purpose of entering new markets, or to provide growth capacity in existing markets where its data centers are fully occupied. The company is not looking at the US market, though, for expansion.

During the year, the total fitted-out space increased 9.8% to 64,214 sq.m (2009: 58,496 sq.m) and total available customer power increased 13.7% to 58 megawatts (‘MW’) (2009: 51MW).

Some other key metrics include:

  • Revenue per occupied square meter increased 7.0 percent to £4,137 ($ 6,619). In 2009 TeleCity achieved revenue of £3,866. On a constant currency basis, the increase was 8.6 percent.
  • In UK and Ireland, Fitted-out space increased 13.6 percent to 30,648 square meter (2009: 26,972 Occupied space increased 15.2% to 27,029 square meter (2009: 23,462 square meters). Revenue per occupied square meter increased 9.1 percent to £4,167 ($6,667).
  • In July 2010, TeleCity Group acquired 1.4MW of capacity in Manchester through the purchase of Internet Facilitators Limited (‘IFL’) for £20.5m ($32.8 million). The IFL acquisition also brought with it the opportunity to develop another site, currently under construction.
  • In the rest of Europe, TeleCity added incremental capacity in Stockholm, Paris and Milan. Total fitted-out space increased 6.5 percent to 33,566 square meters. (2009: 31,524 square meters).
  • Occupied space increased 14.5 percent to 24,087 square meters (2009: 21,028 square meters). Revenue per occupied square meter increased 4.8 percent to £4,104 ($ 6,566). On a constant currency basis, revenue per occupied square meter increased 7.8 percent.
  • Management did not issue guidance for 2001, but confirmed that the Group will deliver a performance in 2011 that is in line with current market expectations.

Here is picture of the company’s plans for future growth (click for larger image):

UK and Ireland represent more than 50% of TeleCity’s revenue stream. Here is a map highlighting the space available in each country where TeleCity has a data center:

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