Rising finance costs pushed FX Networks, the privately held telecommunications infrastructure company, into the red in the year to March 31, even as it boosted sales 51 per cent.
The company made a net loss of $4.4 million for the year, compared with a profit of $355,000 a year earlier,according to financial statements lodged with the Companies Office. Earnings before interest, tax, depreciation and amortisation rose 52 per cent to $4.7 million as the fibre company lifted sales to $37.3 million from $24.7 million a year earlier.
The bulk of FX Networks' loss came from finance expenses of $4.8 million, of which $2.3 million in cash was paid on loans and $2.5 million for finance leases relating to cable sections in the South Island and Cisco equipment in the network.
As at March 31, FX Networks had bank loans of about $7.8 million and lease debts of $24.6 million. In June, the company received waivers for breaching separate debt-to-equity covenants on its bank loan and finance leases.
The company almost tripled construction income, its biggest earner at $13.8 million in the year, followed by a 76 per cent surge in backbone service revenue to $12.5 million. ISP service income increased by a quarter to $7.2 million, while installation-fee revenue climbed 63 per cent to $3.1 million.
Dark fibre sales slumped to $409,000 from $4.8 million a year earlier, while other income dropped to $296,000 from $475,000.
Last year, FX Networks was awarded the national connectivity contract for the nation's research and education network, Kiwi Advanced Research and Education Network ( Karen).
The company missed out on a chunk of government funding to roll out fast broadband to New Zealand's rural areas after a Telecom and Vodafone NZ joint venture won the $300 million project.
