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Sales surge at CSF

RESULTS: Asian data centre group CSF is growing fast and prospects remain healthy
November 28, 2011

Asian data centre operator CSF almost doubled sales in the period – indeed, pre-tax profits only fell because last year's figures were boosted by a £4.5m gain from the sale and leaseback of Malaysian data centre CX1.

IC TIP: Buy at 68p

Revenue growth was largely driven by data centre design and fit-out sales, with fit-outs at Indonesia-based centre CXJ and Malaysia-based CX5 ongoing. In fact, sales from design and fit-outs rose to RM53.8 (£10.8m) from RM11.3m. The CX5 centre is nearing completion and tenants are expected to move in during 2012's first quarter, while the CXJ site is set to be completed by early 2012. Sales growth actually slowed in the data centre rental side, though – inching up 4.8 per cent to RM33.7m in the period, compared with a 19 per cent rise last year. Still, more reliable maintenance revenues rose 32 per cent to RM4.2m. The gross margin has, however, risen to 42.2 per cent from 33 per cent – thanks to Malaysian data centres CX1, CX2 and CX3 having all reached full capacity.

Going forward, management still expects to double current data centre capacity to 1m square feet over the next three to five years, with talks with parties in China, Singapore, Malaysia and Thailand underpinning this target.

CSF GROUP (CSFG)

ORD PRICE:68pMARKET VALUE:£108.8m
TOUCH:66-70p12-MONTH HIGH:78pLOW: 51p
DIVIDEND YIELD:nilPE RATIO:13
NET ASSET VALUE:26pNET CASH:£13m*

Half-year to 30 SepTurnover (RMm)Pre-tax profit (RMm)Earnings per share (sen)Dividend per share (sen)
201046.632.518.8nil
201191.730.115.5nil
% change+97-7-17

£1= Rm (Malaysia Ringgit) 4.98

*Includes £1.3m of restricted cash