Digital 9 Infrastructure Plc · LSE:DGI9
Digital 9 Infrastructure — H1 2022 Earnings Presentation
31 slides from Digital 9 Infrastructure's earnings presentation, September 2022
Slide 1: Interim Results Presentation
See Change. Digital 9 Infrastructure plc Interim Results Presentation Critical infrastructure for our connected world, with long-term, contracted, inflation-protected income for the period ended 30 June 2022
Slide 2: Presentation and Agenda
PRESENTATION AND AGENDA THE PRESENTATION TEAM AGENDA Highlights 3 Financial Overview 9 Valuation 15 Thor Johnsen Isobel Gunn-Brown Andre Karihaloo Head Of Digital Infrastructure Chief Financial Officer Investment Director Portfolio 18 Thor is the Fund Manager for Isobel is ACCA qualified and has And
Slide 3: Financial Highlights
FINANCIAL HIGHLIGHTS 30 June 2022 Pro-forma 105.13 pence £223m IFRS NAV per share Pro-forma EBITDA1 53% 186% Operating cash dividend cover Pro-forma cash dividend cover2 13.7% 13.2x Cost of equity EV / EBITDA multiple2 1Represents LTM to 30 June 2022 EBITDA for subsea and Host, FY21 reported EBITDA
Slide 4: Operational Highlights – H1 FY22
OPERATIONAL HIGHLIGHTS – H1 FY22 29% 45% 10% 2 Increase in H1 FY22 Increase in H1 FY22 Increase in H1 FY22 New systems live revenue vs H1 FY21 EBITDA vs H1 FY21 revenue vs H1 FY21 in H1 2022 D9 announced follow-on investment of $93m Completed 2 crossing and landing in Jan-2022 over a 12-to-18-month
Slide 5: Investment Strategy
INVESTMENT STRATEGY Critical infrastructure for our connected world, with long-term, contracted, Portfolio as at 30 June 20222 inflation-protected income. Target 10% total shareholder return with 6 pence dividend 1 Pro-forma portfolio3 Brain of the internet: processing & storage Subsea Only 10% of e
Slide 6: Highlights from IPO to September 2022
HIGHLIGHTS FROM IPO TO SEPTEMBER 2022 £905m Equity Raised £375m RCF £1,059m Invested3 6p p.a. Dividend Paid £310m Pipeline £300m £175m £275m £95m £300m £60m £75m £310m4 near-term pipeline Investment Trust IPO Placing offer at Placing offer at Placing offer at Revolving Credit Placing offer Revolving
Slide 7: Proforma Portfolio Overview (including Ficolo and Arqiva)
PROFORMA PORTFOLIO OVERVIEW (INCLUDING FICOLO AND ARQIVA) Critical infrastructure for our connected world, with long-term, contracted, inflation-protected income in major currencies 7.7 years 69% 99% £223m Weighted average contract term for Recurring revenues with some form of Exposure to major curr
Slide 8: Illustrative Portfolio Cashflow per Share
ILLUSTRATIVE PORTFOLIO CASHFLOW PER SHARE1 Pro-forma cashflow1 cover almost 2x target 6 pence dividend Bridge to underlying asset cashflow and adjustment to run- rate EBITDA2 53.34% OCF coverage 39.61% OCF coverage Note: This slide is illustrative only and shows potential routes to the generation of
Slide 9: Financial Overview
FINANCIAL OVERVIEW
Slide 10: Financial Highlights as at June 2022
FINANCIAL HIGHLIGHTS as at 30 June 2022 105.13 pence 6 pence £897 million £825 million IFRS NAV Dividend per share Market IFRS Investment per share (annualised) Capitalisation Valuation The NAV as at 30 June 2022 was 105.13 pence per Market capitalisation of £897 million as at 30 June Dividends decl
Slide 11: Statement of Comprehensive Income
STATEMENT OF COMPREHENSIVE INCOME – Period from 1 January 2022 to 30 June 2022 6-month period to 9-month period to £’m 30 June 2022 31 December 2021 £75.5m Unrealised fair value gain on financial 30.0 45.5 FAIR VALUE GAIN ON INVESTMENTS assets Fair value movement since acquisition: Distributions fro
Slide 12: Statement of Financial Position
STATEMENT OF FINANCIAL POSITION £’m 30 June 2022 31 December 2021 Investments at fair value through £824.6m profit & loss 824.6 746.2 Investments held at fair value including total acquisitions of £642m; remaining amount is Trade and other receivables - 0.3 cash held by subsidiaries Cash and cash eq
Slide 13: Net Asset Value Bridge
Price per share (pence) 110.0 108.0 106.0 104.0 102.0 100.0 98.0 96.0 NET ASSET VALUE BRIDGE NAV per share 31 Dec 2021 Income Operating costs Revaluation Equity raise Jan 2022 Dividends NAV per share 30Jun 2022 13
Slide 14: Fund Trajectory
FUND TRAJECTORY 13.4% Total Return since IPO to 30 June 2022; Annualised 10.7% 115 13.40% 15% 110 10% NAV per Cumulative Dividend Paid per Share 6.00p Cumulative Total Return 3.00p 105 5% 100 104.62p 105.13p 0% 103.34p 98.00p 95 -5% IPO 31 Mar-21 Jun-21 Dec-21 Jun-22 NAV per Share Cumulative Dividen
Slide 15: Valuation
VALUATION
Slide 16: Portfolio Valuation
PORTFOLIO VALUATION 10.6% IFRS valuation uplift since December 2021 from £746m to £852m: Aqua Comms increasing by 12% and Verne by 4%1 Cashflow forecasts based on management projections from long-range plans developed annually Aqua Comms and Verne revalued, with other assets held at cost: EMIC-1 (de
Slide 17: Portfolio Valuation – Comparable Metrics
PORTFOLIO VALUATION – COMPARABLE METRICS D9 Implied pro forma portfolio EV / EBITDA trading multiple of 13.2x Pro forma portfolio D9 - pro forma DC Wireless Broadcast composition2 EV / EBITDA multiples1 30x 25.5x 24.8x 25x Subsea 22% 21.6x 21.4x Data Centre 44% 20x Wireless 34% 15x 13.2x 10.2x 10x 5
Slide 18: Portfolio
PORTFOLIO
Slide 19: Portfolio Management: Creating Shareholder Value
PORTFOLIO MANAGEMENT: CREATING SHAREHOLDER VALUE 1. Significant opportunity for accretive investment in growth platforms Subsea Fibre Global Data Centre to Data Centre Hub Connectivity Nordic Data Centres Leading European 100% renewable & low–cost power data centre platform Sea Edge Connectivity and
Slide 20: Asset Investment Strategy: Nordic Data Centre Platform
ASSET INVESTMENT STRATEGY: NORDIC DATA CENTRE PLATFORM Shifting energy-intensive, latency-insensitive data sets to geographies with low-cost green power £462m valuation Sustainable Customers Scalable “It is more sustainable and affordable 1.19 80%+ 5.9x to export data than power.” Weighted PUE1, bel
Slide 21: Growth Platform Building Block - Data Centre
GROWTH PLATFORM BUILDING BLOCK - DATA CENTRE Illustrative Nordic Data Centres Platform Growth Example & Assumptions $6.5 million ~$260m Growth Capex POWER OF THE 1 [40]MW Expansion (Average cost per MW built for current constructions) PLATFORM $1.1 million ~5.9x 2 [40]MW Expansion (Average EBITDA ge
Slide 22: Asset Investment Strategy: Metro Edge Data Centres and Landing Stations
ASSET INVESTMENT STRATEGY: METRO EDGE DATA CENTRES AND LANDING STATIONS Providing critical interconnectivity and low-latency solutions in dense urban centres £61m valuation 11MW £45m 6MW metro edge data centre 6MW Acquisition EV at c. Data centre landing station, with Installed capacity in central L
Slide 23: Asset Investment Strategy: Subsea Fibre Platform
ASSET INVESTMENT STRATEGY: SUBSEA FIBRE PLATFORM Providing the backbone to the internet in the Northern Hemisphere and Asia £226m valuation Asset Operating Length Total system FPs Terabits per Landing points # since (km) Fibre Pairs (FP) owned sec per FP 98% Of international internet 32,000km 1 AEC-
Slide 24: Asset Investment Strategy: Fixed Wireless Access Platform
ASSET INVESTMENT STRATEGY: FIXED WIRELESS ACCESS PLATFORM Providing reliable internet to Dublin’s underserved high-end business broadband market £51m valuation €60m 10.6x Investment EV/FY21 Adjusted EBITDA • Leading enterprise broadband provider in Greater Dublin, 100% owned by D9 • Owns and operate
Slide 25: Outlook
7 - / OUTLOOK
Slide 26: Asset Investment Strategy: Wireless IoT Platform and Broadcast
ASSET INVESTMENT STRATEGY: WIRELESS IOT PLATFORM AND BROADCAST £300m equity The only UK provider of TV and Radio broadcasting and a leading Internet of Things (IoT) platform investment Media Investment Utilities & IoT Distribution Exclusive operation of the UK’s only national terrestrial television
Slide 27: Asset Investment Strategy: Wireless (IoT and Broadcast)
ASSET INVESTMENT STRATEGY: WIRELESS (IOT AND BROADCAST) Strong cash generation from media distribution and growth from smart utilities, with ~8 years contract length FY21 FY21 Segment Description Market Position Contract Lengths Key Customers Revenue EBITDA1 TV Broadcast Provides regulated transmiss
Slide 28: Arqiva Summary Historical Financials and Debt
ASSET INVESTMENT STRATEGY: WIRELESS (IoT AND BROADCAST) Summary historical financials Asset-level Debt (Non-Recourse to D9) £m; As of June 30, 2021 As of June 30, 2021 Shareholding Arqiva Net Debt £m x EBITDA FY21 Senior debt 1,052 3.2x Media distribution 520 Revenue Junior notes 625 1.9x Smart util
Slide 29: Pipeline: People, Purpose, Platform
PIPELINE: PEOPLE, PURPOSE, PLATFORM1 No. of Bilateral Near term £’m % assets £’m Data centre 130 42% 3 130 Ficolo Subsea fibre 50 16% 1 50 Verne Global Terrestrial 130 42% 2 80 Wireless - - - - Aqua Comms Total 310 6 260 SeaEdge UK1 Host Ireland No. of Bilateral Volta Medium term £’m % assets £’m Ar
Slide 30: Summary
SUMMARY Digital Infrastructure: the infrastructure of the internet $400 billion per year Growing >$400 billion per annum asset opportunity Infrastructure asset class Investing in subsea cables, data centres, terrestrial fibre and wireless networks 4 attractive best in class asset platforms – Subsea
Slide 31: Thank You for Attending
INVESTMENTS WITH PURPOSE FOR PROFIT DIGITAL 9 BY PEOPLE INFRASTRUCTURE FROM TRIPLE POINT / THANK YOU FOR ATTENDING
Digital 9 Infrastructure — H1 2022 Earnings Presentation on 6ix