GDS Holdings Ltd. · HKEX:9698
GDS — Q1 2022 Earnings Presentation
47 slides from GDS's earnings presentation, May 19, 2022
Slide 1: 1Q22 Earnings Call
1Q22 Earnings Call 19 May 2022 NASDAQ: GDS HKEX: 9698 © GDS 2016 0
Slide 2: Disclaimer
DISCLAIMER This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such a
Slide 3: Business Strategy & Performance Highlights
Business Strategy & Performance Highlights William Huang, Chairman & CEO © GDS 2016
Slide 4: 1Q22 Highlights
1Q22 HIGHLIGHTS (1)(2) Uninterrupted Operations • Recurring revenue business, with net additional area utilized of +12,545 sqm • Total area utilized of 332,019, +32.2% y/y and utilization rate of 67.4% Sales Momentum • Net additional area committed of +18,188 sqm or +43 MW • Total area committed inc
Slide 5: Uninterrupted Operations Despite Challenging Conditions
Uninterrupted Operations Despite Challenging Conditions 58 GDS Data Centers Underwent Lockdown © GDS 2016 4
Slide 6: Customers Still Able To Move-In
Customers Still Able To Move-In Net Additional Area Utilized (Sqm) Total Area Utilized (Sqm) & Utilization Rate (%) (1) (2) Organic Acquisition B-O-T 69.6% 67.4% 66.0% 66.1% 65.5% 30,587 1,841 332,019 319,475 300,328 281,650 15,122 18,678 19,147 251,063 16,331 908 3,505 1,733 2,614 12,545 5,089 16,0
Slide 7: Solid Backlog & High Commitment Rate (Area In Service)
Solid Backlog & High Commitment Rate (Area In Service) Backlog For Area In Service (Sqm) Area In Service (Sqm) & Commitment Rate (%) 95.0% 96.2% 95.9% 93.8% 95.3% 135,383 138,364 136,940 128,874 487,883 492,344 454,354 426,543 91,608 360,542 1Q21 2Q21 3Q21 4Q21 1Q22 1Q21 2Q21 3Q21 4Q21 1Q22 © GDS 20
Slide 8: Solid Backlog & High Pre-Commitment Rate (Area Under Construction)
Solid Backlog & High Pre-Commitment Rate (Area Under Construction) Backlog For Area Under Construction (Sqm) Area Under Construction (Sqm) & Pre-Commit Rate (%) 70.0% 62.1% 61.3% 63.1% 58.2% 119,152 106,050 96,148 97,573 98,983 170,149 168,128 165,175 161,515 157,227 1Q21 2Q21 3Q21 4Q21 1Q22 1Q21 2Q
Slide 9: Delivery Schedule Adjusted To Market Conditions
Delivery Schedule Adjusted To Market Conditions Net Additional Area In Service & Scheduled Capacity Additions (Sqm) 92,690 Net Additional Area In Service Scheduled Capacity Additions (1) 61,340 56,583 51,979 38,023 14,246 11,760 2Q: 9,785 1Q: 4,461 1H21 2H21 1H22 2H22 1H23 2H23 2024 & Beyond Notes:
Slide 10: Continued Sales Momentum – Net Additional Area Committed
Continued Sales Momentum – Net Additional Area Committed Past 5 Quarters (Sqm) Past 5 Years (Sqm) (1) (2) (1) (2) Organic Acquisition B-O-T Organic Acquisition B-O-T 161,558 44,848 38,006 118,722 3,440 19,166 27,911 92,800 22,864 26,611 23,538 81,215 23,723 16,665 3,698 9,464 3,440 18,188 11,862 9,0
Slide 11: New Hyperscale Customer Commitments In 1Q22
New Hyperscale Customer Commitments In 1Q22 Largest Bookings In 1Q22 Shanghai Pujiang Site (SH16/17/18) IT Power Area Committed Data Center Committed (Sqm) (MW) SH18 SH16 SH18 Phase 1 4,506 12.0 SH17 BJ14 Phase 1 5,427 14.1 BJ21 / BJ22 6,668 13.3 © GDS 2016 10
Slide 12: Customer Franchise Development
Customer Franchise Development Total Area Committed By Segment (Sqm) (1Q22) (1) Hyperscale Customer Additions (2) FSI & Large Enterprises 2011 – 2016 69,749 12.1% 2017 (3) 2018 Large Internet 115,309 773 20.1% Customers (4) +9.0% Y/Y 2019 389,951 67.8% 2020 Cloud Service Providers 2021 Notes: . 1. F
Slide 13: Accelerating Regionalization Plan
Accelerating Regionalization Plan Significant Progress Outside Mainland China Nusajaya Tech Park Ground-Breaking Ceremony with YAB Name L o c a tio n O w n e rs h ip S ta tu s RFS C a p a c ity (M W ) Datuk Onn Hafiz bin Ghazi, Chief Minister of Johor (C) Hong Kong & Macau HK1 Hong Kong Own U n d e
Slide 14: Financial & Operating Review
Financial & Operating Review Dan Newman, CFO © GDS 2016
Slide 15: 1Q22 P&L Analysis
1Q22 P&L Analysis Quarterly Financial Review Rmb‘000 (unless indicated) 1Q21 4Q21 1Q22 Y/Y Q/Q Service Revenue 1,704,492 2,185,857 2,243,535 31.6% 2.6% Equipment Sales 1,475 1,520 59 (96.0%) (96.1%) Total Net Revenue 1,705,967 2,187,377 2,243,594 31.5% 2.6% Cost of Revenue (1,309,115) (1,700,104) (1
Slide 16: 1Q22 Underlying Trends
1Q22 Underlying Trends Quarterly Financial Review Rmb‘000 (unless indicated) 1Q21 4Q21 1Q22 Y/Y Q/Q Total Net Revenue 1,705,967 2,187,377 2,243,594 31.5% 2.6% Less: Equipment Sales 1,475 1,520 59 (96.0%) (96.1%) Service Revenue 1,704,492 2,185,857 2,243,535 31.6% 2.6% Adjusted GP 928,031 1,148,397 1
Slide 17: Revenue & Area Utilized By Quarter
Revenue & Area Utilized By Quarter Total Revenue (Rmb Mn) Net Additional Area Utilized (Sqm) & MSR (1) (2) Organic Acquisition B-O-T 2,243.6 30,587 2,187.4 1,841 2,061.4 1,863.9 18,678 19,147 15,122 1,706.0 16,331 908 2,614 1,733 3,505 12,545 5,089 16,037 15,642 13,717 13,624 7,456 1Q21 2Q21 3Q21 4Q
Slide 18: Underlying Adjusted GP & EBITDA & Margin
Underlying Adjusted GP & EBITDA & Margin Underlying Adjusted GP (Rmb Mn) & Margin Underlying Adjusted EBITDA (Rmb Mn) & Margin 54.4% 54.0% 52.5% 52.5% 52.4% 47.9% 48.1% 46.9% 47.2% 47.1% 1,174.6 1,031.1 1,055.9 1,148.2 1,083.0 966.0 1,006.8 896.7 927.8 816.5 1Q21 2Q21 3Q21 4Q21 1Q22 1Q21 2Q21 3Q21 4
Slide 19: Capex Paid
Capex Paid (1) Past 5 Quarters (Rmb Mn) Past 5 Years (Rmb Mn) Rmb Mn 1Q21 2Q21 3Q21 4Q21 1Q22 Organic Acquisition 13,691.5 3,992.4 Organic (2) 2,274.9 1,868.4 3,241.9 2,313.9 2,161.7 9,378.0 1,357.5 Acquisition (3) 32.8 2,968.8 575.1 415.7 2,770.3 4,733.1 5,131.2 4,932.0 578.6 9,699.1 475.1 8,020.5
Slide 20: Financing Obligations & Liquidity
Financing Obligations & Liquidity Debt & Cash Outstanding Loan Maturity Schedule At 31/03/22 (Rmb Mn) 31/03/21 31/12/21 31/03/22 (3) Working Capital Project Loan Convertible Bond / LQA Adj. Rmb Mn Rmb Mn Rmb Mn EBITDA Total Loan 14,026.6 24,232.5 25,836.3 6.1 Convertible Bond 1,945.1 1,895.8 5,804.5
Slide 21: Growth Visibility
Growth Visibility Quarterly Resource Financial Status At Review 1Q22 (Sqm) Area Utilized Backlog Total Area Committed 575,009 332,109 242,990 Cost To Complete: Rmb 11.2 bn Area In Service Under Construction Total Capacity 660,473 492,344 168,128 Held For Future Secured Pipeline 464,359 464,359 Notes
Slide 22: Business Outlook
Business Outlook FY22 Annual Guidance Remains Unchanged Rmb Mn FY21 Actual FY22 Guidance Implied Y/Y Total Revenue 7,818.7 9,320 - 9,680 19.2% - 23.8% Adjusted EBITDA 3,703.4 4,285 - 4,450 15.7% - 20.2% Capex (1) 13,691.5 ~12,000 -12.4% Notes: 1. Refers to net cash used in investing activities, incl
Slide 23: Questions & Answers
Questions & Answers www.gds-services.com [email protected] © GDS 2016
Slide 24: Appendix
Appendix © GDS 2016
Slide 25: Our Data Center Portfolio – Beijing & Shanghai Markets
Our Data Center Portfolio – Beijing & Shanghai Markets Self-Developed Data Centers In Service & Under Construction In Tier 1 Markets (1Q22) Beijing – Tianjin – Hebei: 42 DCs (1) Yangtze River Delta: 31 DCs (1) BJ5/10/11/12/15/16/20/21/22/23 CS1/2/3 SH1/2/3/4/6/7/8/9/ BJ4/6 10/11/12/14/15/19 BJ13/14
Slide 26: Our Data Center Portfolio – Greater Bay Area & Chengdu / Chongqing
Our Data Center Portfolio – Greater Bay Area & Chengdu / Chongqing Self-Developed Data Centers In Service & Under Construction In Tier 1 Markets (1Q22) Greater Bay Area: 18 DCs (1) Chengdu – Chongqing: 3 DCs (1) SZ5 SZ8 GZ1/2/3/6 SZ4 HZ1 GZ4 SZ9/10 SZ6 HK1/2 SZ1/2/3 CD1/2 CQ1 Notes: 1. Includes all
Slide 27: Key Operating KPIs
Key Operating KPIs Past 8 Quarters As At 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 Area In Service (Sqm) 277,925 291,282 333,853 360,542 426,543 454,354 487,883 492,344 Area Under Construction (Sqm) 144,873 170,186 158,035 170,149 165,175 157,227 161,515 168,128 Total Capacity (Sqm) 422,797 461,468 49
Slide 28: Data Center Summary By Market
Data Center Summary By Market At 31/03/22 (Sqm, Unless Indicated) (1) Area Held for Pre- Area In Area Under Area Area Pre- Total Area Commitment Utilization Total Capacity Future Area Utilized Commitment # of Self- Service Construction Committed Committed Committed Rate Rate Development (2) Rate Mar
Slide 29: Self-Developed Data Centers In Service – Beijing / Tianjin / Hebei
Self-Developed Data Centers In Service – Beijing / Tianjin / Hebei At 31/03/22 (Sqm, Unless Indicated) Data Center Ready For Service Type Tenure Area In Service Area Committed Commitment Rate Area Utilized Utilization Rate BJ1 2H15 Convert Lease 2,435 2,429 99.8% 2,368 97.3% BJ2 2H17 Convert Lease 5
Slide 30: Self-Developed Data Centers In Service – Yangtze River Delta
Self-Developed Data Centers In Service – Yangtze River Delta At 31/03/22 (Sqm, Unless Indicated) Data Center Ready For Service Type Tenure Area In Service Area Committed Commitment Rate Area Utilized Utilization Rate SH1 2H11 Purpose-Built Lease 6,432 6,264 97.4% 5,953 92.5% SH2 2H15 Purpose-Built L
Slide 31: Self-Developed Data Centers In Service – Greater Bay Area
Self-Developed Data Centers In Service – Greater Bay Area At 31/03/22 (Sqm, Unless Indicated) Ready For Data Center Type Tenure Area In Service Area Committed Commitment Rate Area Utilized Utilization Rate Service SZ1 2H14 Convert Lease 4,286 4,280 99.9% 4,238 98.9% SZ2 1H16 Convert Lease 4,308 4,30
Slide 32: Self-Developed Data Centers In Service – Chengdu / Chongqing & Other
Self-Developed Data Centers In Service – Chengdu / Chongqing & Other At 31/03/22 (Sqm, Unless Indicated) Ready For Area Commitment Market Data Center Type Tenure Area In Service Area Utilized Utilization Rate Service Committed Rate CD1 1H17 Purpose-Built Own 6,262 6,134 98.0% 4,472 71.4% Chengdu – C
Slide 33: Self-Developed Data Centers Under Construction
Self-Developed Data Centers Under Construction At 31/03/22 (Sqm, Unless Indicated) Market Data Center Ready For Service Type Tenure Area Under Construction Area Pre-Committed Pre-Commitment Rate BJ13 Phase 1 1H22 Purpose-Built Own 5,465 5,465 100% BJ13 Phase 2 1H23 Purpose-Built Own 8,438 8,438 100%
Slide 34: Forming Consolidated JVs For Selected B-O-T Projects
Forming Consolidated JVs For Selected B-O-T Projects B-O-T Data Centers Market Data Center RFS Status GDS Ownership Net Floor Area Utilization Rate ZB1 1H18 In Service 100% 5,132 94.9% ZB2 2H18 In Service 100% 4,662 94.5% ZB3 2H18 In Service 100% 4,662 94.6% Beijing – Tianjin – Hebei ZB4 1H20 In Ser
Slide 35: Self-Developed Data Center Capacity – Lease Vs. Own
Self-Developed Data Center Capacity – Lease Vs. Own At 31/03/22 Total Developed & Sqm Area In Service Area Under Construction Held For Future Development Developable Capacity Lease 303,413 37,265 29,894 370,572 Own 110,844 127,423 434,465 672,733 B-O-T 68,910 3,440 - 72,350 3 rd Party 9,177 - - 9,17
Slide 36: Stabilized Vs. Ramping-Up Data Centers
Stabilized Vs. Ramping-Up Data Centers Breakdown Of Area In Service At 1Q22 Stabilized Data Centers Ramping-Up Data Centers Area In Service (Sqm) Commitment Rate Utilization Rate Area In Service Area In Service (Sqm) Commitment Rate Utilization Rate SH1 6,432 97.4% 92.5% SH2 7,712 99.7% 91.5% SH7 6,
Slide 37: Top Customers
Top 5 Customers By Total Area Committed (1)(2) By Revenue (1) % Of Total Area Number of Data End User End User % Of 1Q22 Total Net Revenue Committed As At 1Q22 Centers (3) Customer 1 40.2% 46 Customer 1 23.9% Customer 2 16.0% 17 Customer 2 20.8% Customer 3 4.6% 6 Customer 3 6.7% Customer 4 4.1% 5 Cu
Slide 38: Forthcoming Contract Renewals
Forthcoming Contract Renewals Contract Renewal Schedule (1) Period Sqm % of Total Area Committed From April 1 to Dec 31, 2022 32,212 5.6% FY23 47,840 8.3% FY24 61,743 10.7% FY25 58,071 10.1% FY26 57,887 10.1% Thereafter 317,256 55.2% Total Area Committed At 31/03/22 575,009 100% © GDS 2016 37
Slide 39: Principal Shareholders
Principal Shareholders At 31/03/22 Pro Forma Ordinary Shares (1) Equivalent ADS Equivalent ADS % of Total ADS Change (3) William Huang (2) 83,859,040 10,482,380 10,482,380 5.6% Directors & Officers (4) 11,054,640 1,381,830 1,381,830 0.7% STT GDC 477,288,484 59,661,061 59,661,061 31.8% Ping An 0 0 +4
Slide 40: Working Capital Management
Working Capital Management Accounts Receivable Turnover Days (# Of Days) (1) Days Payable Outstanding (DPO) (2) 94 87 # of Days 1Q21 2Q21 3Q21 4Q21 1Q22 86 81 74 DPO – Opex 85 94 94 88 83 DPO – Capex 185 116 130 136 271 Total DPO 155 111 121 124 197 Total DPO (Excl. Acquisitions) 128 92 99 93 141 1Q
Slide 41: Historical Financial Results – Statements of Operations
Historical Financial Results Condensed Consolidated Statements Of Operations Amounts in thousands Three Months Ended Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 RMB RMB RMB RMB RMB USD Net Revenue Service revenue 1,704,492 1,862,951 2,061,104 2,185,857 2,243,535 353,909 Equipmen
Slide 42: Historical Financial Results – Balance Sheets
Historical Financial Results Condensed Consolidated Balance Sheets Amount in thousands. As of Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 RMB RMB RMB RMB RMB USD Cash 14,914,125 12,326,895 10,103,624 9,968,109 11,320,911 1,785,830 Accounts receivable, net of allowance for doubtf
Slide 43: Historical Financial Results – Cash Flows
Historical Financial Results Condensed Consolidated Statements of Cash Flows Amounts in thousands Three Months Ended Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 RMB RMB RMB RMB RMB USD Net cash (used in) provided by operating activities (24,197) 363,274 456,191 406,095 (244,730)
Slide 44: Reconciliation from Gross Profit to Adjusted Gross Profit
Reconciliation from Gross Profit to Adjusted Gross Profit Adjusted Gross Profit Amounts in thousands Three Months Ended Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 RMB RMB RMB RMB RMB USD Gross profit 396,852 439,869 455,435 487,273 486,417 76,730 Depreciation and amortization 4
Slide 45: Reconciliation from Net Loss to Adjusted EBITDA
Reconciliation from Net Loss to Adjusted EBITDA Adjusted EBITDA Amounts in thousands Three Months Ended Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 RMB RMB RMB RMB RMB USD Net loss (278,737) (298,463) (301,131) (312,882) (373,253) (58,880) Net interest expenses 357,670 411,722 3
Slide 46: Definition Of KPIs
Definition Of KPIs Area In Service Entire net floor area of data centers (or phases of data centers) which are ready for service Entire net floor area of data centers (or phases of data centers) which are actively under construction and have not yet reached Area Under Construction the stage of being
Slide 47: Analyst Coverage
Analyst Coverage Broker Analyst Contact BofA Paul Dewberry [email protected] BOCI Michael Meng [email protected] Berenberg Nate Crossett [email protected] CICC Hongjie Li [email protected] Citi Arthur Lai [email protected] Citic Securities Junyun Chen chenjunyun@