Ann: FY14 Results Investor Presentation, page-6

I actually like the capex to keep going up. I believe this is the critical variant perception from the general market.

The growth capex is in response to demand, meaning it is driven by sales orders (a number which they have stopped reporting in this report). Capex slowing down can be inferred as waning demand, or alternatively, the more positive view is that VOC will now concentrate efforts into squeezing more out of capex eg targetting tenants within the same building connected by VOC fibre.

With capex efficiency at 0.58, $17m of capex means minimum $14m of growth capex (assuming $3m in maintenance capex), giving rise to extra recurring revenue of at least $24m per annum, such revenue recurring over minimum of 3 years contract length. More capex, more recurring revenue. 30% gross margins means that a contract will repay the cost of the capex spent within 3 years. Anything else VOC can squeeze out of the fibre (the other 155 pair strands out of 312 in total) is pure gravy. Any customer that renews a contract is also pure gravy (chances of renewal are good- would you like to shift data between data centres, and changing comms provider, and hoping for compatibility with your routers?).

The recent acquisitions actually muddy up the waters a bit on what is otherwise a very simple and understandable business model going forward.