The Megaport Ltd (ASX: MP1) share price is on the move on Tuesday morning following the release of its full year results.
In early trade, the network as a service (NaaS) solutions provider's shares are up 1% to $17.60.
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Megaport share price higher after FY 2021 results and acquisition announcement
- Revenue increased 35% year on year to $78.28 million.
- Monthly recurring revenue (MRR) jumped 32% to $7.5 million (annualises to $90 million)
- Customers increased 443 or 24% to 2,285
- Ports grew 1,922 or 33% to 7,689
- Average revenue per port down $2 to $978
- Net loss of $55 million but cash position of $136.3 million
- US$15 million acquisition of InnovoEdge
What happened in FY 2021 for Megaport?
Another year of strong growth was reported today, which is helping drive the Megaport share price higher.
For the 12 months ended 30 June, the company reported a 35% increase in revenue to $78.3 million and a 32% jump in MRR to $7.5 million. This was driven by the expansion of its data centre footprint, customer and ports growth, strong demand for Megaport Cloud Router, and the launch of Megaport Virtual Edge.
Positively, the company achieved the milestone of becoming EBITDA break-even in June. Though, on the bottom line, Megaport still recorded a $55 million loss for the period. Nevertheless, the company remains in a very strong financial position, with a cash balance of $136.3 million at the end of the year.
What did management say?
Megaport's Chief Executive Officer, Vincent English, said, "Our investment in innovation and products supported big growth in Fiscal Year 2021. Megaport Cloud Router, our virtual routing service that creates cloud-to-cloud connections on demand, grew 64% in the period."
"MCR drives greater service adoption across our platform and provides our customers the agility they need to power their digital transformation. Our revenue numbers were also bolstered by strong new customer growth as a result of investments made in our commercial team and focus in growing our channel," he added.
What's next for Megaport?
Mr English is positive on the year ahead but provided no real guidance for FY 2022.
He commented: "The Megaport mission for the coming year is to 'Scale Up, Scale Out'. This is a commitment by everyone at Megaport to accelerate our growth and our innovation cycle to increase our lead in the NaaS space. With a proven business model, the trust of partners and customers, and a leading platform built for innovation, we are well positioned to achieve this. We will invest in revenue growth by making investments in further market expansion, product and service innovation, and most critically, the people responsible for making Megaport the transformational technology company that is changing the way IT services are built today and tomorrow. "
InnovoEdge Acquisition
Also giving the Megaport share price a boost today was a separate announcement. That announcement reveals that Megaport has signed an agreement to acquire InnovoEdge for US$15 million in cash and scrip. It is an AI-powered multicloud and edge application orchestration company.
Vincent English said: "Empowering our customers and partners with greater agility is a priority for Megaport. The acquisition of InnovoEdge aligns well with that priority and will help us drive greater functionality across our leading Network as a Service platform. By integrating the InnovoStudio service with our portal and software defined network, we will provide customers and partners with greater visibility and control of networking, cloud, and service resources."
Megaport share price continues to outperform
Following today's gain, the Megaport share price is now up a sizeable 24% in 2021. This means it is outperforming the ASX 200 by approximately 11%.
