Digital Realty Trust, Inc. · NYSE:DLR
Digital Realty Trust — Q3 2015 Earnings Presentation
23 slides from Digital Realty Trust's earnings presentation, Oct 29, 2015
Slide 1: The Next Horizon
The Next Horizon October 29, 2015
Slide 2: The Next Horizon: Three-Year Guideposts
The Next Horizon Three-Year Guideposts 1 SUPERIOR RETURNS Deliver superior risk-adjusted total shareholder returns 2 CAPITAL ALLOCATION Prudently allocate capital to opportunistically extend global campus footprint 3 PRODUCT OFFERINGS Drive higher returns on the Our Focus asset base by diversifying
Slide 3: Telx Integration Update
Telx Integration Update Minimizing Disruption in 2015, Targeting Growth in 2016 Phase II Integration Leaders Objectives of Integration MICHAEL HENRY Established combined senior- CHIEF INFORMATION OFFICER level organizational structure Retain Will initially operate as a • More than 25 years of en
Slide 4: Concluding Capital Recycling Initiative
Concluding Capital Recycling Initiative Redeploying Accretively, Enhancing Portfolio Quality Property Square Feet (1) Occupancy (2) 7 1 Kato & Page 199,352 100% 2 5 1 3 2 Gold Camp 63,791 100% 4 6 3 900 Walnut 112,266 94.6% 4 210 Tucker 336,047 65.1% 5 1807 Michael Faraday 19,237 100% One property
Slide 5: 2015 Year-to-Date Leasing Activity
2015 Year-to-Date Leasing Activity (1) (2) Customer Concentration Consistent with Strategy ($ in millions) SMACC Financial IT Other Boston $0.9 $0.0 $0.3 $0.4 Chicago $14.3 -- $0.1 $0.2 Dallas $20.3 -- $0.1 $0.6 Houston $0.0 -- $0.0 $0.6 Northern Virginia $18.8 $5.0 $1.2 $0.0 New York Metro -- $0.2
Slide 6: U.S. Major Market Data Center Supply
U.S. Major Market Data Center Supply (1) Supply and Demand Roughly in Equilibrium in megawatts 3Q15 (2) Current Supply New Construction Sublease Availablility DLR Inventory 60 40 20 - Boston Chicago Dallas Houston N Virginia NY Metro Phoenix Silicon Valley in megawatts 2Q15 (2) Current Supply New Co
Slide 7: Decelerating Global Economic Growth Outlook
Decelerating Global Economic Growth Outlook Data Center Demand Drivers a Bright Spot MACROECONOMIC Global GDP Growth Forecast (1) 2015E: 3.3% 2015E: 3.1% 3.1% 3.6% U.S. GDP Growth Forecast (1) 2015E: 2.5% 2015E: 2.6% 2.6% 2.8% U.S. Unemployment Rate (2) 5.4% 5.2% 5.3% 4.9% Crude Oil ($/barrel) (3) $
Slide 8: Financial Results
Financial Results
Slide 9: Sustained Leasing Momentum
Sustained Leasing Momentum Driving Improved Returns Historical Lease Signings Total s.f. Annualized GAAP Annualized GAAP Annualized GAAP Base Rent (2) Product Type Signed (1) Base Rent / s.f. (2) Base Rent (2) $ in millions Turn-Key Flex® 159,208 $186 $29.6 million $80 Powered Base Building® – – – C
Slide 10: Backlog Sets the Stage for Future Growth
Backlog Sets the Stage for Future Growth Healthy Balance between Lag + Available Inventory $ in millions Backlog Commencement - Timing (1) Annualized GAAP Base Rent $80 $17 $40 $35 $70 $52.1 $17 $17.0 $ 4Q15 2016 2017+ Total Backlog $ in millions Custom Solutions Turn-Key Other Sign-to-Commencement
Slide 11: Cycling Through Peak Vintage Renewals
Cycling Through Peak Vintage Renewals Approaching Mark-to-Market Inflection Point Signed renewal leases representing $18 million of Total annualized GAAP rental revenue 4% 11% Cash GAAP Data Rental rates on renewals increased by 4% on a Rent Change Rent Change Center cash basis and increased by
Slide 12: 3Q15 Core FFO/sh Five Cents Ahead of the Street
3Q15 Core FFO/sh Five Cents Ahead of the Street Proactive Portfolio Management + Leasing Drove Beat Core FFO per share $0.01 $0.02 $0.02 $1.32 $1.30 $1.27 $1.20 $1.10 $1.00 (1) (2) 3Q15 Core FFO - Property Tax Refunds FX Impact Early Commencements 3Q15 Core FFO - Actual Consensus + Delayed Asset Sal
Slide 13: Constant-Currency Growth
Constant-Currency Growth FX Represents ~300 bps Drag on Reported Results As Reported Constant Currency (1) 12% 11.5% 10.2% 8% 8.8% 8.2% 6.9% (2) 6.7% 5.8% (2) 3.8% 4% 4.5% 2.2% 0% 3Q15 / 3Q14 3Q15 / 3Q14 3Q15 / 3Q14 3Q15 / 3Q14 2015 / 2014 Core Revenue Growth Adj. EBITDA Growth Same-Capital Cash Cor
Slide 14: Well-Staggered Maturity Schedule
Well-Staggered Maturity Schedule No Bar Too Tall; Nominal Near-Term Maturities Syndication Underway to Extend Global Unsecured Revolving Credit Facility and Term Loan to 2021 (1) (2) Secured Mortgage Debt Unsecured Prudential Shelf Facility Pro Rata Share of JV Debt ($ in billions) Unsecured Notes (
Slide 15: Q&A
Q&A
Slide 16: Consistent Execution on Strategic Vision
Consistent Execution on Strategic Vision Recreate S&U on Powerful Connection Shifts Focus to Future Growth previous page in Column Graphs Successful 3Q15 Initiatives Improved ROIC Achieved 10 bps sequential improvement in ROIC; 130 bps improvement since 4Q13 Closed Telx Closed acquisition of Telx,
Slide 17: Appendix
Appendix
Slide 18: Definitions of Non-GAAP Financial Measures
Definitions of Non-GAAP Financial Measures The information included in this presentation contains certain non-GAAP financial measures that management believes are helpful in understanding our business, as further described below. Our definition and calculation of non-GAAP financial measures may diff
Slide 19: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Net Income Available to Common Stockholders to Funds From Operations (FFO) (in thousands, except per share and unit data) (unaudited) Three Months Ended Nine Months Ended S
Slide 20: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent Three Months Ended Nine Months Ended September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014 FFO available to common stockholders and unitholders $ 177,850 $ 168,811 $ 570,359 $ 497,086 Add: 5.50% exchangeable seni
Slide 21: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Net Income Available to Common Stockholders to Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA (in thousands) (unaudited) Three
Slide 22: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Same Capital Cash Net Operating Income (in thousands) (unaudited) Three Months Ended Nine Months Ended September 30, 2015 September 30, 2014 September 30, 2015 September 30
Slide 23: Forward-Looking Statements
Forward-Looking Statements The information included in this presentation contains forward-looking statements. Such statements are based on management’s beliefs and assumptions made based on information currently available to management. Such forward-looking statements include statements relating to: