Digital Realty Trust, Inc. · NYSE:DLR
Digital Realty Trust — Investor Presentation (September 2024)
46 slides from Digital Realty Trust's investor presentation, September 2024
Slide 1: Global. Connected. Sustainable.
Global. Connected. Sustainable. INVESTOR PRESENTATION SEPTEMBER 2024 The meeting place for companies, technologies and data
Slide 2: Digital Realty Overview
r Digital Realty Overview L.
Slide 3: A Global Data Center and Connectivity Platform Supporting our Customers' Critical IT Architecture
A Global Data Center and Connectivity Platform Supporting our Customers’ Critical IT Architecture 5,000+ 223,000+ 50+ 300+ Customers (1) Cross connects (1) Metros (1) Data Centers (1) EQUITY & ENTERPRISE VALUE TOP PUBLICLY TRADED U.S. REIT $51 Bn $68 Bn 7th 2016 EQUITY MARKET ENTERPRISE LARGEST ADDE
Slide 4: Consistent Execution Against Strategic Priorities
Consistent Execution Against Strategic Priorities As of June 30, 2024 BOOKINGS 1 Strengthen our Customer Value Proposition 2 Innovate & Integrate for our Customers Building new applications 3 Diversifying and Bolstering Capital Sources Partnering with sources of Executing Meeting Place strateg
Slide 5: Assembling Strategic Pieces of the Global Puzzle
Assembling Strategic Pieces of the Global Puzzle 2015 2016 2017 2018 2020 2022 Metros 30 31 31 34 49 50 50+ Cross 60 70 74 78 164 211 223 Connects (in 000s) European Telx DuPont Fabros Ascenty Interxion Teraco Portfolio Acquisition A Leading North America U.S. Provider of Colocation, Eight Highly-Co
Slide 6: Offering a Global Data Center Platform
Offering a Global Data Center Platform Capacity Blocks in World’s Major Metros to Meet Growing Customer Demand Global Capacity 168 MW delivered in first half of 2024 ~2,500 MW total capacity in place >3,000 MW buildable IT capacity Geographically Diversified (1) 5% 10% 4% North America Europe 54% AP
Slide 7: Over 3 GW of Incremental Global Buildable IT Capacity
Over 3 GW of Incremental Global Buildable IT Capacity = >100MWs of Buildable IT Capacity = >50MWs of Buildable IT Capacity = <25MWs of Buildable IT Capacity AMERICAS EMEA APAC TOTAL Existing Capacity 1,600 MWs 750 MWs 300 MWs 2,650 MWs Buildable Capacity 2,100 MWs 1,200 MWs 400 MWs 3,700 MWs Total C
Slide 8: Experienced Management Team Solely Focused on Building and Operating Data Centers
Experienced Management Team Solely Focused on Building and Operating Data Centers DIGITAL REALTY LEADERSHIP TEAM Andy Power Matt Mercier Greg Wright Cindy Fiedelman Chris Sharp Jeannie Lee Colin McLean Jeff Tapley President & CEO Chief Financial Officer Chief Investment Officer Chief HR Officer Chie
Slide 9: Strong Secular Trends
Strong Secular Trends Artificial Intelligence Driving Next-Generation Demand 9
Slide 10: Multiple Secular Demand Drivers
Multiple Secular Demand Drivers Global Demand Across the Product Spectrum Artificial Cloud Enterprise Intelligence Digital Transformation Demand Driver 42% 50GW 20% CAGR Actively New Capacity Forecasted Data Center Demand Deploying AI (1) by 2028 (2) Growth through 2028 (2) Initial Scale Demand for
Slide 11: Global Data Insights Survey 2024 Takeaways
Global Data Insights Survey 2024 Takeaways Data-first strategies Data is pervasive Data localization Data drives the advance AI innovation and growing matters business agenda Apps 52% Services 79% Data of Data and AI Leaders of respondents cite lack Companies are planning to are actively executing a
Slide 12: AI Platform Readiness
AI Platform Readiness Industry Data As power-dense workloads grow, Digital Realty’s modular designs can accommodate advanced cooling solutions (1) Average Rack Density Increase and % of Racks above 30 kw Cooling Technology by Threshold of Rack Densities Enterprise & Enterprise & Colocation + AI / HP
Slide 13: Private Interconnections Enable Enterprise AI Applications
Private Interconnections Enable Enterprise AI Applications Private AI Exchange Powered by ServiceFabric helps enterprises alleviate data gravity barriers FUTURE-PROOFED ORCHESTRATION HD Colo accelerates 150 kW/rack ServiceFabric enables intelligent AI deployments in 34 markets across the global work
Slide 14: The PlatformDIGITAL Competitive Advantage
The PlatformDIGITAL® Competitive Advantage PlatformDIGITAL® Seeks to Generate Greater Customer Demand, Driving Significant Returns via a Differentiated Product Offering Hyperscale Enterprise / Colo Data Centers Data Centers Hyperscalers deploy cloud Enterprises can connect to the on-ramps which allo
Slide 15: Global Connectivity Hubs
Global Connectivity Hubs Network Density that Promotes Innovation and Collaboration 28+ METROS 223K+ CROSS-CONNECTS Globally Where Our GLOBALLY Internet Gateways Are Located 50+ 3,900+ ASSETS NETWORK INSTANCES With Over 1,000 GLOBALLY Cross-Connects Each Note: As of June 30, 2024. 15
Slide 16: The ServiceFabric Differentiating Factor
The ServiceFabricTM Differentiating Factor ServiceFabric Seeks to Allow the Customer to Establish Numerous, Seamless Virtual Private Connections BUILDING SERVICEFABRIC CONNECTIONS SERVICEFABRIC AT A GLANCE 150+ 375+ 38 Digital Realty Facilities 3rd Party Enabled Metros Globally Connected Globally Da
Slide 17: Disciplined Financial Strategy
Disciplined Financial Strategy Committed to an Investment Grade Balance Sheet Supported by Multiple Funding Sources 17
Slide 18: Proven Track Record of Sustainable Growth
Proven Track Record of Sustainable Growth Disciplined Financial Management 2018 2Q24 Better/ Worse Change Properties / Data Centers (1) 214 310 44% Total Enterprise Value (2) $35 billion $68 billion 83% SIZE & DIVERSIFICATION RMZ Rank 5th 7th (3) Down Two IG-equivalent AAA-rated Fortune 50 Top
Slide 19: Committed to Conservative Capital Structure
Committed to Conservative Capital Structure Growing Enterprise Value While Maintaining Target Credit Metrics CREDIT METRICS CAPITAL STRUCTURE Net Debt (1) / LQA Adjusted EBITDA (2) Fixed Charge Coverage (2)(3) 7.1x 6.8x 24% 6.2x 5.8x 5.4x 5.3x Debt 4.4x 4.5x 4.2x 4.1x 4.0x 4.1x Debt Preferred Equity
Slide 20: Matching the Duration of Assets and Liabilities
Matching the Duration of Assets and Liabilities Modest Near-Term Maturities, Well-Laddered Debt Schedule DEBT MATURITY SCHEDULE AS OF JUNE 30, 2024 (1)(2) DEBT PROFILE (U.S. $ in billions) $3.7 4.1 YEARS 2.8% Unsecured $3.3 Weighted Avg. Weighted Avg. Maturity (1)(2) Coupon (1)(3) 96% Secured Unsecu
Slide 21: Recent Financial Results
Recent Financial Results Note: Certain data in this section was originally posted to the Company’s website on July 25, 2024 and has not been updated to reflect changes occurring after that date. 21
Slide 22: AI Spurs Demand for Large Capacity Blocks
HISTORICAL BOOKINGS ANNUALIZED GAAP BASE RENT AI Spurs Demand $ in millions for Large $240 Capacity Blocks $180 Strong and Steady Leasing for 0-1MW + IX $120 • Record 1H24 with $417M Bookings $60 • 4th Consecutive Quarter 0-1MW+IX $0 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 Over $50M 2Q24 B
Slide 23: Increasing Demand Driving Rental Rate Growth
Increasing Demand Driving Rental Rate Growth Pricing Improvement Resulting in Higher Development Yields RENTAL RATES ON >1 MW BOOKINGS AMERICAS DEVELOPMENT YIELDS GAAP Base Rent Per Kilowatt Rising Rental Rates Driving Higher Stabilized Development Yields $153 11.7% $141 9.5% 9.0% $108 8.6% $105 7.9
Slide 24: Connected Data Communities
Connected Data Communities Strong 0-1MW + IX Revenue 2Q24 Results 148 Record New Logos $54M 2Q bookings from 0-1MW + Interconnection #3 Highest 0-1MW + IX Bookings in History 24
Slide 25: Strong Pricing Environment
Strong Pricing 2Q24 RENEWAL SPREADS Environment Renewal Spreads Driven 0-1 MW > 1 MW OTHER (1) TOTAL By 0-1MW Segment RENTAL RATE CHANGE RENTAL RATE CHANGE RENTAL RATE CHANGE RENTAL RATE CHANGE 3.8% 3.9% 16.3% 4.0% • ~58% of Total Renewals CASH CASH CASH CASH from 0-1MW 3.9% 12.1% 33.0% 7.5% GAAP GA
Slide 26: Lease Expirations Provide Re-Pricing Opportunities
Lease Expirations % of Lease Expirations by Annualized Base Rent (1) Provide Re-Pricing Opportunities 30% >1 MW 0-1 MW Other 5.0% – 7.0% • Shorter term 0-1 MW 25% Updated 2024 leases provide near Guidance (2) for cash rental rate on renewals term opportunities to 20% drive price increases 15% • Even
Slide 27: Record Commencements Bodes Well for Future Growth
Record BACKLOG ROLL-FORWARD (1) $ in millions COMMENCEMENT TIMING (3) $ in millions Commencements Bodes Well for $164M $176M Future Growth $154M $154M $539M $527M $117M $527M • Record $176 Million of $110M Commencements in $232M 2Q24 $203M • Near Record Backlog $478M $478M $478M $177M $165M 1Q24 Bac
Slide 28: High-Quality, Diversified Customer Base
High-Quality, TOP 20 CUSTOMERS Diversified Customer Base Customer Rank Locations % of Customer Rank Locations % of ARR (1) ARR (1) • Top customers have a 1. Fortune 50 Software Company 72 10.8% Fortune 25 Tech 11. Company 53 1.5% presence in 40 different 2. Social Content Platform 26 5.5% 12. 125 1.
Slide 29: Spotlight on Sustainability: Building for a Better Tomorrow
Spotlight on Sustainability: Building for a Better Tomorrow Helping Enterprises Cut Costs and Meet Their Sustainability Goals 29
Slide 30: Leading Data Center Partner for Sustainability
Leading Data Center Partner for Sustainability Science-Based Target Commitment to Reduce Global Emissions by 68% by 2030 RENEWABLE ENERGY GREEN BUILDINGS ENERGY EFFICIENCY GREEN BONDS Leading data center purchaser of More green building certified IT capacity More Energy Star certifications than Lead
Slide 31: Serving a Social Purpose
Serving a Social Purpose Delivering Growth for All Stakeholders SOCIAL GOVERNANCE Newsweek’s America’s Most Responsible 2024 Enhanced Board diversity to 44% female or Companies of 2023(1) ethnically diverse 2023 Launched Supply Chains ESG Program Top 100 ranking on JUST Capital America’s Most JUST C
Slide 32: Appendix
Presenter Name 15/09/22 Appendix
Slide 33: Management Statements on Non-GAAP Measures
Appendix Management Statements on Non-GAAP 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
Slide 34: Forward-Looking Statements
Appendix Forward-Looking Statements This information in this presentation contains forward-looking statements within the meaning of the federal securities laws, which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes an
Slide 35: Reconciliation of Non-GAAP Items
Reconciliation of Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Net Income Available to Common Stockholders to Funds From Operations (FFO) Non-GAAP Items (in thousands, except per share and unit data) (unaudited) To Their Closest GAAP Three Months Ended June 30, 2024 June 30, 2023 Eq
Slide 36: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Funds From Operations (FFO) to Core Funds From Operations (CFFO) To Their Closest GAAP (in thousands, except per share and unit data) (unaudited) Equivalent Three Months Ended June 30, 2024 June 30, 2023 F
Slide 37: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent 37
Slide 38: Reconciliation of Net Debt/LQA Adjusted EBITDA
Reconciliation of Net Debt/LQA Adjusted EBITDA Total debt at balance sheet carrying value $ QE 03/31/23 17,875,511 Non-GAAP Items Add: DLR share of unconsolidated joint venture debt Add: Capital lease obligations, net 1,123,360 335,910 To Their Closest GAAP Less: Unrestricted cash (361,380) Net Debt
Slide 39: Reconciliation of Non-GAAP Items
Total Debt/Total Enterprise Value QE 03/31/23 Debt Service Ratio (LQA Adjusted EBITDA/GAAP interest expense plus capitalized interest and less bridge Reconciliation of Market value of common equity(i) $ 29,272,861 facility fees) Liquidation value of preferred equity(ii) 755,000 Total GAAP interest e
Slide 40: Reconciliation of Non-GAAP Items
Total Debt/Total Enterprise Value QE 06/30/23 Debt Service Ratio (LQA Adjusted EBITDA/GAAP interest expense plus capitalized interest and less bridge facility (i) Market value of common equity $ 34,812,727 fees) Liquidation value of preferred equity(ii) 755,000 Total GAAP interest expense (including
Slide 41: Reconciliation of Non-GAAP Items
Total Debt/Total Enterprise Value QE 09/30/23 Reconciliation of Debt Service Ratio (LQA Adjusted EBITDA/GAAP interest expense plus capitalized interest and less bridge facility (i) Market value of common equity $ 37,434,562 fees) Liquidation value of preferred equity(ii) 755,000 Total GAAP interest
Slide 42: Reconciliation of Non-GAAP Items
Total Debt/Total Enterprise Value QE 12/31/23 Reconciliation of Debt Service Ratio (LQA Adjusted EBITDA/GAAP interest expense plus capitalized interest and less bridge (i) Market value of common equity $ 42,804,053 facility fees) Liquidation value of preferred equity(ii) 755,000 Total GAAP interest
Slide 43: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items To Their Closest GAAP Net Debt/LQA Adjusted EBITDA PF 12/31/23 Equivalent Net Debt as of December 31, 2023 Pro forma proceeds from asset sales, completion of JVs and issuance of shares through the ATM $ 17,377,488 program in January 2024 (1,246,000) Pro Forma Net Deb
Slide 44: Reconciliation of Non-GAAP Items
Total Debt/Total Enterprise Value QE 03/31/24 Debt Service Ratio (LQA Adjusted EBITDA/GAAP interest expense plus capitalized interest and less bridge facility (i) Reconciliation of Market value of common equity $ 45,950,001 fees) Liquidation value of preferred equity(ii) 755,000 Total GAAP interest
Slide 45: Reconciliation of Net Debt/LQA Adjusted EBITDA
Net Debt/LQA Adjusted EBITDA QE 06/30/24 Total debt at balance sheet carrying value $ 16,339,746 Reconciliation of Add: DLR share of unconsolidated joint venture debt 1,415,647 Add: Capital lease obligations, net 358,386 Less: Unrestricted cash (2,573,739) Non-GAAP Items Net Debt as of June 30, 2024
Slide 46: Thank you
r Thank you FN DIGITAL Lv REALTY.
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