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Sinnet 1H Financials: Revenue Climbs 14.98%, Net Profit Jumps 15.06%
COVID-19 and China
Image credit: Unsplash/Johanness Plenio

The Chinese Cloud and colocation service provider Sinnet (300383:SZ) disclosed its half-year financial results on Sunday, August 29. Compared to a year ago, its revenue surged by 14.98% to CNY 3.97 billion, it also generated a 15.06% higher profit of CNY 451 million. Specifically, the cloud computing topline topped by 19.14% with a slightly decreased gross margin of 10.06%. Sinnet's data center revenue reached CNY 807 million, increased by 8.23%, year-on-year.

The company raises around 76% of total revenue by providing agency services in China for Amazon Web Services. It also offers retail-based colocation services to clients from the finance, cloud, education sectors. Sinnet runs 38,000 cabinets currently.

Seasoned equity offering

On July 2, the company announced a plan to issue ordinary directional shares that could raise up to CNY 5 billion, bolstering faster data center construction schemes. The company expected the program to be passed this year.

Datacenter pipeline

Sinnet also mentioned some facility projects had been delayed as the government took strict pandemic prevention initiatives. The company committed to accelerating the process of building facilities and trying to keep up with the timeline.  

Government's supporting measurements

As China is pushing a new infrastructure plan, more supporting measures from the government are on the way. Recently, the Shanghai government rolled out the 'Guidance on Shanghai Industrial Green Loan' to support the development of new green infrastructure, incorporating data centers. It provides lower-cost, flexible and alternative funding channels to data center projects.

The stock price was largely unchanged with a decrease of 0.02% on its first trading day after the results were published.

Editor: Luke Sheehan
ANALYST
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