Vocus' acquisitions of M2 and Nextgen Networks leads to explosive growth

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Vocus' acquisitions of M2 and Nextgen Networks leads to explosive growth
Geoff Horth, Vocus

Vocus has reported another gigantic jump in revenue following a year of high profile acquisitions and organic growth.

Revenue was up a whopping 403 percent to $888 million for the half year ending 31 December. Earnings were up 200 percent to $187 million, and net profit after tax was up 95 percent to $47 million.

The telecommunications giant is still seeing the financial benefits from its merger with the M2 Group, which was completed in February 2016 and created one of the largest telcos in the country, with a strong presence in both enterprise and consumer network connections.

It wasn't just M2 boosting Vocus' profits. The most recent results got another kick from the acquisition of Nextgen Networks.

Vocus acquired the network provider in October last year for $870 million, along with two of its development projects. Vocus said that Nextgen contributed $34 million in revenue and $1.3 million in net profit during the six-month period.

Chief executive Geoff Horth said Vocus benefited greatly from organic growth as well, not just from its recent acquisition spree.

"We are pleased to have continued to demonstrate organic growth across the business despite increasing competition in a number of areas and despite a period of significant corporate activity and integration," he said.

During the six-month period, Horth survived a failed leadership spill, which saw the shock resignation of Vocus founder James Spenceley and former Amcom chairman Tony Grist.

Horth said the company would now be looking ahead to participate in the growth and demand of high-speed data links in Australia.

"While there is a large program of integration work to be completed to realise the full benefits of the recent acquisitions, we have a detailed plan and an experienced and passionate team," he said.

"We remain confident of our ability to deliver on the potential in the outstanding platform we have built, and ultimately drive improved returns for shareholders."

Vocus reiterated that it expected earnings for the full 2017 financial year in the range of $430 million and $450 million.

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