Digitalbridge Group, Inc. · NYSE:DBRG
Digitalbridge — Colony Capital — Q4 2020 Earnings Presentation
38 slides from Digitalbridge's earnings presentation, Feb 25, 2021
Slide 1: Fourth Quarter 2020 Earnings Presentation
1 FOURTH QUARTER 2020 EARNINGS PRESENTATION February 25, 2021
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Slide 3: Disclaimer
3 Disclaimer This presentation may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that
Slide 4: Agenda
4 4 Agenda # Section 1 2020 Year In Review 2 2020 Financial Results 3 2021 The Year Ahead 4 Why Own CLNY Today 5 Q&A
Slide 5: 2020 Year In Review
ColonyCapital 2020 Year In Review
Slide 6: Promises Made, Promises Kept
6 Promises Made, Promises Kept Sharp focus throughout the year on the four key pillars of our digital transformation Harvested Legacy Assets & Streamlined Organization Invested in High Quality Digital Assets Built Liquidity & Strengthened Capital Structure Rapidly Grew Digital Investment Management
Slide 7: Built Strong Liquidity to Fund Digital Transformation
7 $700M $500M $300M $450M Built Strong Liquidity to Fund Digital Transformation In the face the pandemic, we buried capital constraints by generating almost $2 billion of liquidity to extend maturities, reduce leverage and invest substantial capital into digital infrastructure Transparency with lend
Slide 8: Fix the Debt, The Common Responds Next
8 Fix the Debt, The Common Responds Next Management’s decisive actions to stabilize the CLNY capital structure were well received by the credit markets last summer We suggested at the time, you needed to fix the 'Top of the Stack' before the common stock could work Our debt has continued to strength
Slide 9: Harvested Legacy Assets
9 Harvested Legacy Assets Hospitality Sale Highlights ▪ Under contract to sell non-core legacy business with minimal expected cash flows for the next two or three years as the lodging market recovers ▪ $2.8B transaction with $67.5M of gross consolidated proceeds to CLNY ▪ Shedding all contingent lia
Slide 10: Invested In High Quality Digital Assets
10 Digital Operating +$1.6B FEEUM ~$550M of equity invested in Digital Operating Companies raising $1.6B+ of new third- party equity $411M TEV $355M FEEUM April 2020 Digital Colony acquires the carve out of three data center campuses to launch a hyperscale platform in Latin America $544M TEV $422M F
Slide 11: Step-Function Growth in Digital FEEUM
11 ~90% year-over-year growth in digital FEEUM…far exceeding our original 15% guidance for the year Step-Function Growth in Digital FEEUM ▪ Digital Liquid Strategies: ▪ ~$400M of FEEUM across two strategies, both of which have performed well and are poised for growth ▪ Co-Invest: ▪ In 2020 we raised
Slide 12: DCP II First Closing
12 $1.9B $4.2B $4.1B DCP I DCP II ▪ $1.9B DCP I first close in 2018 resulted in $4.1B total fund size which was the largest digital infrastructure fund to-date ▪ $4.2B DCP II first close in 2021 exceeds DCP I total fund size and is now the largest dedicated digital infrastructure fund Current Capita
Slide 13: 2020 Financial Results
ColonyCapital 2020 Financial Results
Slide 14: 4Q20 Summary Results
14 4Q20 Summary Results (1) Includes Digital Operating and Digital Investment Management segments. Excludes Digital Other segment. (2) Includes $1.25B from sale of light industrial ($ millions except per share & AUM) 4Q19 3Q20 4Q20 Q/Q% FY 2020 Consolidated Revenues $299.1 $316.7 $338.8 +7% $1,236.6
Slide 15: Digital Earnings Summary
15 Consolidated Digital Adjusted FRE / Adjusted EBITDA(1)Core Digital Revenues(1) Digital Earnings Summary Consolidated Digital Revenues increased to $152M in 4Q20, driven by acquisitions of Vantage SDC in 3Q20 and zColo in 4Q20 for Digital Operating and new fees from the first closing of DCP II(2)
Slide 16: Rapid Expansion of Digital AUM and FEEUM
16 $6.8B $7.7B $7.7B $8.6B $12.8B 43% 46% 48% 49% 64% 4Q19 1Q20 2Q20 3Q20 4Q20 $13.8B $20.6B $21.6B $23.3B $30.0B 33% 43% 47% 50% 58% 4Q19 1Q20 2Q20 3Q20 4Q20 +29% Q/Q 58% 42% 32% 68% $41.7B 4Q19 Total AUM Rapid Expansion of Digital AUM and FEEUM Digital - Assets Under Management (AUM) Fee Earning E
Slide 17: Extending Maturities, Maximizing Liquidity
17 $200M $314M 2021 2022 2023 2024+ Extending Maturities, Maximizing Liquidity Significant Liquidity for Digital TransformationManaging Corporate Liabilities (1) Excludes $65M of corporate and convertible debt maturing in January 2021, which the Company paid off. Weighted average maturity and intere
Slide 18: Significant Run-Rate Cost Savings Achieved
18 Significant Run-Rate Cost Savings Achieved Simplification of Cost Structure and G&A Also executing on the Digital transformation within corporate operations Cash Comp & Admin., -$31M Cash Comp & Admin., -$42M Stock Comp, -$9M Stock Comp, -$13M -$40M -$55M 22 185K 16 146K # of Offices Total SqFt B
Slide 19: Consistent and Steady Growth Through 2020
19 $40M $38M $40M $41M $66M 1Q20 2Q20 3Q20 4Q20 PF 4Q20 $76M $79M $85M $100M $125M 1Q20 2Q20 3Q20 4Q20 PF 4Q20 $36M $34M $62M $84M $124M 1Q20 2Q20 3Q20 4Q20 PF 4Q20 $13M $13M $28M $39M $56M 1Q20 2Q20 3Q20 4Q20 PF 4Q20 Consistent and Steady Growth Through 2020… 2020 represents the first full year of
Slide 20: Tracking to 2021 Guidance and 2023 Targets
20 $23M $53M $175M $58M $225M 2020 Actual 2021 Guidance 2023 Targets $39M $80M $80M $85M $110M 2020 Actual 2021 Guidance 2023 Targets $84M $140M $150M $150M $200M 2020 Actual 2021 Guidance 2023 Targets $54M $125M $400M $135M $500M 2020 Actual 2021 Guidance 2023 Targets …Tracking to 2021 Guidance and
Slide 21: Full Year 2021 Guidance Summary
21 Full Year 2021 Guidance Summary ($ millions, except where noted) Low High Digital IM Fee Revenue $140 $150 Digital Operating Revenue (CLNY OP Share) $125 $135 Total Digital Revenues $265 $285 Digital IM FRE $80 $85 Digital Operating EBITDA (CLNY OP Share) $53 $58 Total Digital FRE / EBITDA $133 $
Slide 22: 2021 The Year Ahead
ColonyCapital 2021 The Year Ahead
Slide 23: Digital Transformation is Accelerating
23 Wellness CLNC Legacy OED / IM Digital Wellness CLNC Hotel Legacy OED / IM Digital Digital Transformation is Accelerating 58% Digital 4Q20 Actual Pro Forma(1) 67% Digital (1) Pro Forma AUM is representative of total company AUM following the completion of the hotel portfolio transaction (including
Slide 24: 2021: Four Key Digital Tailwinds
24 2021: Four Key Digital Tailwinds 5G CLOUD $1.1T in New Global Mobile Capex $88B in 2021 Cloud Infrastructure Capex Increasing to IOT EDGE Connected Devices 1.6M EDGE SERVERS ON THE EDGE IN 2028 Source: GSMA The Mobile Economy March 2020, Cisco Report, Source: Credit Suisse, September 2020; Cowen
Slide 25: Active Into An Improving Macro Backdrop
25 Active Into An Improving Macro Backdrop Digital Colony is well positioned to continue investing in high quality digital businesses into 2021 and beyond Digital Colony's ability to form and deploy capital into new themes and ideas across digital infrastructure is more powerful and relevant than ev
Slide 26: Continuing to Grow Our Digital IM Franchise
26 Continuing to Grow Our Digital IM Franchise Long-term contracted fee streams drive stable, predictable earnings that compound over time $13B Digital Bridge ▪ 6 separately capitalized companies ▪ Formed the original base for growth Credit • In house digital credit team • Intend to form capital aro
Slide 27: Investment Case Comes Together
27 Investment Case Comes Together CLNY 2.0 SHARE OUR VISION New management building the next great digital infrastructure platform, creating value for shareholders as it transforms a diversified REIT across many real estate verticals to a new focused digital REIT As a complex organization is streaml
Slide 28: Why Own CLNY Today
ColonyCapital Why Own CLNY Today
Slide 29: The Colony Difference
29 1. Fastest Growing digital REIT 2. Converged Vision for Network Infrastructure allowing investors to participate in the entire ecosystem 3. Leadership and experience matter: CLNY has the deepest bench in the sector, and this gives us a decided advantage as we invest, finance, and operate our busi
Slide 30: A Global Digital REIT Focused on Converged Networks
30 Colony Capital delivers a series of customer solutions focused on next-generation mobile and internet connectivity solutions through a converged network experience A Global Digital REIT Focused on Converged Networks Traditional Siloed Digital Infrastructure Approach Macro Site Data Centers Small
Slide 31: Diverse Global Portfolio of Digital Infrastructure Assets
31 Between the balance sheet and investment management, we have assembled a diverse global portfolio of digital infrastructure assets equating to $30.0B in AUM 31 Notes: All figures as of December 31, 2020 except otherwise noted. (1) CLNY balance sheet has a combined exposure to DCP I and DCP II of
Slide 32: The Deepest Team with a Singular Focus
32 The Deepest Team with a Singular Focus F IBER & SMALL CELL TEAMD A T A C ENTER TEAM TO WER TEAM Raul Martynek Senior Advisor CEO of DataBank Sureel Choksi Senior Advisor Board Member of Zayo and Scala; President and CEO of Vantage Brokaw Price Operating Partner A 20+ year veteran in the data cent
Slide 33: A Commitment to Our Shared Future
33 DCP integrates ESG analysis into the due diligence of potential investments. Reports include key company-level and macro ESG risks and opportunities A Commitment to Our Shared Future CLNY NET ZERO 2030 DEI PROGRESS TARGET NET ZERO GREENHOUSE GAS EMISSIONS BY 2030 ACROSS THE ENTIRE COLONY DIGITAL
Slide 34: Q&A Session
34 5 Q&A Session
Slide 35: Non-GAAP Reconciliations
35 Non-GAAP Reconciliations Total CLNY Core Digital Segments (5) for the Year Ended for the Three Months Ended for the Year Ended Core Funds from Operations (in thousands, except per share) December 31, 2020 September 30, 2020 December 31, 2019 December 31, 2020 December 31, 2020 September 30, 2020
Slide 36: Non-GAAP Reconciliations
36 Non-GAAP Reconciliations (1) CLNY’s share of the $5.7M one-time outperformance incentive was $4.9M, which is based on the partial year CLNY owned 100% of the Digital investment management business prior to the Wafra investment. Three Months Ended Twelve Months Ended (In thousands) December 31, 20
Slide 37: Important Note Regarding Non-GAAP Financial Measures
37 Important Note Regarding Non-GAAP Financial Measures This presentation includes certain “non-GAAP” supplemental measures that are not defined by generally accepted accounting principles, or GAAP, including the financial metrics defined below, of which the calculations may from methodologies utili
Slide 38: Colony Capital
ColonyCapital