DXN’s Debt Refinancing and Property Buy Pose Execution Challenges Ahead

Strong Revenue Growth and Contract Wins

DXN Limited closed the June 2025 quarter with a notable 51% increase in revenue to $5.8 million compared to the same period last year. This surge was largely driven by new contract wins across its modular data centre and operations divisions, reflecting growing demand for prefabricated, edge-ready infrastructure solutions.

Key contracts signed during the quarter include a $3.6 million Data Centre as a Service (DCaaS) agreement with a US-based global satellite provider, marking DXN’s entry into this recurring revenue model. Additionally, a $2 million contract with DP World Australia and a $4.6 million deal with US telecom company Globalstar underscore the company’s expanding footprint in critical logistics, AI infrastructure, and mission-critical telecom markets.

Strategic Property Acquisition and Debt Refinancing

DXN finalized the acquisition of the SDC Darwin property for $2.1 million, a move that immediately enhanced its asset base with an independent valuation of $10.1 million. This acquisition not only secures a key operational site but also strengthens the company’s balance sheet.

Supporting this purchase, DXN refinanced its debt through a $5 million loan facility with iPartners Pty Ltd, replacing higher-cost borrowings and generating an annual cash flow saving of approximately $300,000. The refinancing also enabled repayment of outstanding debts and vendor warranties, positioning DXN for improved financial flexibility.

Improved Cash Flow and Backlog Orders

Operating cash flow turned positive in Q4 FY25, reaching approximately $60,000 after a negative $1.8 million in the prior quarter. This improvement was driven by customer payments aligning with shifted project timelines. The company ended the fiscal year with a strong cash balance of $3.1 million and a backlog of $12 million in orders, providing solid revenue visibility as it enters FY26.

Outlook and Growth Initiatives

DXN’s management expressed optimism about the growth trajectory, highlighting the strategic importance of the DCaaS model and new product initiatives such as the StructCore indoor modular data centre solution and AI-enabled infrastructure. These innovations aim to capture emerging market demand for scalable, secure, and high-performance data centre environments.

With a diversified project pipeline and expanding client base, DXN is well positioned to capitalize on the digital infrastructure revolution, particularly in edge computing and mission-critical sectors.