Update from Canaccord:A new McCloud contract has been signed. A...

Update from Canaccord:

1. A new McCloud contract has been signed. A multi-national energy company has signed a one-year contract with renewal options. The committed value of the contract, excluding burst utilisation, is US$2.7m per annum.
2. An off-market transfer of shares has been conducted. Ixora Prince Pty Ltd has transferred 2,222,222 shares to ‘sophisticated and professional investors’. Consideration per shares was $1.35 and Ixora Prince no longer holds a substantial interest in shares on completion.

As a recap on DUG and the IPO process

• DUG is a technology company providing high performance computing as a service (HPCaaS), scientific data analysis services, and software solutions for the global technology and resource sectors. DUG owns and operates some of the largest and “greenest” high performance computing (HPC) installations in the world.
• The company raised A$55m through the pre-IPO and IPO rounds. The funding will be put towards DUG’s ‘Working Scenario’ which contemplates a US33m capex program to add 25 double-precision petaflops of compute capacity at its Skybox facility in Houston.
  • DUG has framed a three-year horizon to execute on this Scenario.
  • It contemplates additional revenue of US$59m and EBITDA of US$43m.
• The company expects FY20 revenue to be US$48.6m and EBITDA to be US$9.8m.

The IPO was priced on 7.6x FY20 expected EBITDA. This compares to a peer group of Australian Services (11.6x FY20 EV/EBITDA), Australian Technology and Data Centres (20.3x FY20 EV/EBITDA), US Technology and Data Centres (21.0x FY20 EV/EBITDA) and Global Oil & Gas Services (6.2x FY20 EV/EBITDA).