SHAPE Australia wins $558 million DigiCo data centre expansion contract (updated)

SHAPE Australia

14/10/2026 23:19

Co says project to materially contribute to 2027, 2028 revenue
Project lifts firm's work in hand to more than A$1.4 billion
SHAPE Australia shares hit 2-month low on profitability concerns
Adds analyst comments in paragraphs 5 and 9-10
Oct 15 (Reuters) - Construction firm SHAPE Australia SHA.AX said on Thursday it had won a nearly A$800 million ($557.60 million) contract from DigiCo Infrastructure REIT DGT.AX to expand a data centre campus in Sydney.
Demand for data centre capacity has surged worldwide as companies ramp up investments in AI infrastructure, driving a wave of expansion projects across Australia and other major markets.
The fixed-price design-and-construct contract from DigiCo covers a 52-megawatt expansion of the SYD1 facility, lifting total campus capacity to 88 MW after adding existing capacity and a recently completed 20-MW upgrade delivered by SHAPE.
SHAPE, which provides refurbishment and design-and-build services to industries ranging from government and defence to hotels and hospitality, said it had been appointed head contractor and would start work immediately.
ETF Shares CEO Cliff Man said winning a project of this scale should establish SHAPE as a credible contender in Australia's data centre construction boom, but delivering profitably will be the real test.
The project will lift its work in hand to more than A$1.4 billion and materially contribute to revenue in 2027 and 2028, SHAPE said. 
The project will reuse an existing data centre asset with approved grid capacity, water access and development approvals already in place, avoiding a greenfield development.
Shares of SHAPE fell as much as 11.7% in early trade, however, hitting their lowest since August 12 and putting them on track for their worst day since February 29, 2024. DigiCo declined as much as 4.1% to its lowest since April 20.
"Judging by the market reaction, investors don't seem particularly confident in SHAPE's ability to manage these risks, despite the company having successfully completed an earlier stage of the project," Man said.
Man said even a relatively small cost overrun could wipe out the entire expected profit, given the thin margins SHAPE has historically earned on its projects. 
DigiCo acquired the SYD1 facility, which has two large-scale Sydney sites, after approval from the Foreign Investment Review Board in 2024.     
     
($1 = 1.4347 Australian dollars)

 (Reporting by Rajasik Mukherjee and Anjali Singh in Bengaluru; Editing by Shilpi Majumdar and Subhranshu Sahu)
 ((Rajasik.Mukherjee@thomsonreuters.com;))