TeleCity on track to meet full-year targets

TeleCity Group said it was on track to meet its full-year expectations, although it warned that revenue growth will be at the low end of its guidance.

In a trading update released on Wednesday, the FTSE 250 group said in the nine months to the end of September, organic revenue on a constant currency basis grew 7.2% year-on-year, while underlying revenue grew 9.7%.

The group said the increase in revenue was driven by a sharp improvement in its UK performance and added further underlying revenue growth was expected in the final quarter of the year.

However, the data centre provider warned that revenue growth for the full financial year is likely to be at the low end of its 8-10% constant currency growth guidance.

Meanwhile, TeleCity indicated it was making good progress in negotiations with US sector peer Equinix, which agreed to acquire the London-listed company in May, with the takeover set to be completed in the first half of next year.

“Whilst further improvements in the UK revenue growth rate and a continuation of strong underlying profitable growth in the Rest of Europe is expected, the full year 2015 revenue growth rate is likely to be towards the lower end of the previously guided revenue growth range,” said group executive chairman John Hughes.

“The board maintains its positive view on the trajectory for the group going forward.”

TeleCity shares were untraded at 1,179.00p at 0843 GMT on Wednesday.