Digital Realty Trust, Inc. · NYSE:DLR
Digital Realty Trust — Q2 2020 Earnings Presentation
25 slides from Digital Realty Trust's earnings presentation, Jul 30, 2020
Slide 1: Global. Connected. Sustainable. 2Q20 Financial Results
Global. Connected. Sustainable. 2Q20 FINANCIAL RESULTS JULY 2020 Digital Realty the trusted foundation | powering your digital ambitions
Slide 2: Navigating the Future
Navigating the Future Sustainable Growth for Customers, Shareholders and Employees GLOBAL CONNECTED SUSTAINABLE Selling GLOBALLY… Supporting LOCALLY AMERICAS EMEA APAC A Digital Realty and Brookfield Infrastructure JV DIGITAL REALTY | 2Q20 FINANCIAL RESULTS | JULY 30, 2020 | 2
Slide 3: Prioritizing Health and Safety Amid Global Pandemic
Prioritizing Health and Safety Amid Global Pandemic Maintaining Resiliency Employees and Vendors • Minimized on-site data center staffing and increased safety protocols • Coordinated with suppliers to verify response plans and service continuity capacity • Consistent, robust communications cadence C
Slide 4: Serving a Social Purpose
Serving a Social Purpose Delivering Sustainable Growth for All Stakeholders ENVIRONMENTAL SOCIAL GOVERNANCE Enhanced Board diversity 2020 Published Second $1 million+ philanthropic effort Annual ESG Report supporting COVID-19 pandemic relief with the addition of in June 2020 and racial justice effor
Slide 5: Expanding Global Platform Supporting Customer Growth
Hong Seoul Expanding Global Platform Kong Supporting Customer Growth Frankfurt Mexico Paris City Paris| Late 2021 Seoul| Late 2021 Mexico| 2021 Marseille| 2020 Hong Kong| Mid 2021 Marseille Frankfurt Strategic International Development Greater Presence in Asia, Europe and Latin America 5 ~350 MW 6 C
Slide 6: Combining Leading Platforms in EMEA
Combining Leading Platforms in EMEA Further Solidifying Global Connection with Customers PAR8, the first of four planned data centers in Interxion’s new Paris Digital Park Customers Communities of Interest Growth Deal referral wins with deployments Interxion: A Digital Realty Company, Capitalizing o
Slide 7: Data Gravity Driving Data Center Demand
Data Gravity Driving Data Center Demand PlatformDIGITAL Poised to Capitalize Multi-Tenant Data Center Digital Transformation (1) (MTDC) Demand Global MTDC Platform Leader (4) NEW ENTRANT CHALLENGERS MATURITY LEADERS 175 EDGECONNEX 87% CORESITE EQUINIX LATENCY THROUGHPUT SERVICES DATA APPS Zettabytes
Slide 8: Financial Results
Financial Results DIGITAL REALTY | 2Q20 FINANCIAL RESULTS | JULY 30, 2020 | 8
Slide 9: Combination Creates Powerful Global Platform
Combination Creates Powerful Global Platform Expanded Customer Base and Reach Poised for Growth Global Presence Customers and Communities Growth 280 4,000+ $2 Bn Data Centers Customers of Development 45 160,000+ 224 MW Metros Cross-Connects of Construction 86% 29% 59% Total Occupancy of Revenue from
Slide 10: Digital Transformation Driving Steady Demand
Digital Transformation Driving Steady Demand Global Full-Product Spectrum Provides Broadest Solutions HISTORICAL BOOKINGS ANNUALIZED GAAP BASE RENT $ in millions Space & Power Interconnection $150 $100 $50 $0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2Q20 BOOKINGS 0-1 MW > 1 MW OTHER (1
Slide 11: Attracting New Logos
Data Communities of Interest Analytics Attracting New Logos 124 New Logos in 2Q20 Higher Education $12 mm Interconnection Bookings Semiconductor Manufacturer $34 mm Bookings in EMEA, APAC, LatAm DIGITAL REALTY | 2Q20 FINANCIAL RESULTS | JULY 30, 2020 | 11
Slide 12: Top-Line Step Function: Healthy Backlog
Top-Line Step Function Healthy Backlog Sets a Solid Foundation BACKLOG ROLL-FORWARD (1) COMMENCEMENT TIMING (2) $ in millions $ in millions Digital Realty Backlog Interxion Backlog Digital Realty Backlog Interxion Backlog $15 $18 $29 $15 $6 $18 $42 $117 $63 $44 $21 $251 $210 $122 $129 1Q20 Backlog S
Slide 13: Cycling Through Peak Vintage Renewals
Cycling Through Peak Vintage Renewals Narrowing the Gap on Cash Re-Leasing Spreads 2Q20 RE-LEASING SPREADS 0-1 MW > 1 MW OTHER (1) TOTAL RENTAL RATE CHANGE RENTAL RATE CHANGE RENTAL RATE CHANGE RENTAL RATE CHANGE -1.6% -6.5% 0.6% -2.8% CASH CASH CASH CASH 8.3% 3.5% 7.6% 7.2% GAAP GAAP GAAP GAAP Sign
Slide 14: Effective Economic Risk Mitigation Strategies
Effective Economic Risk Mitigation Strategies Benefits of Scale and Diversification on Display EXPOSURE BY REVENUE (1) CUSTOMER CONCENTRATION BY REVENUE (2) USD CAD GBP EURO JPY HKD SGD AUD LATAM Content Potential At-Risk 1% 16% Enterprise 7% Financial 4% 22% Cloud 8% 2% 29% 63% Other Enterprise < 1
Slide 15: Four Quarter Two-Step: Beat, Dip, Shuffle, Bounce
Four Quarter Two-Step Beat, Dip, Shuffle, Bounce 2020E CORE FFO PER SHARE 1Q20 2Q20 NOI Growth Strategic Capital COVID-19 3Q20 4Q20 Management Deferred OpEx Note: Based on management estimates; actual performance may differ materially. Core FFO and NOI are non-GAAP financial measures. For descriptio
Slide 16: Prudent Balance Sheet Management
Prudent Balance Sheet Management Pro Forma Credit Metrics in Line with Target Net Debt to Adjusted EBITDA (1) Fixed Charge Coverage Ratio (2) 0.5x 0.3x 5.7x 4.9x 5.2x 4.6x 4% 0% Floating Rate Floating Rate Debt Debt (3) 2Q20 Pro Forma 2Q20 2Q20 Pro Forma 2Q20 Reported Adjustments (3) As Adjusted (3)
Slide 17: Matching the Duration of Assets and Liabilities
Matching the Duration of Assets and Liabilities Clear Runway on the Left, No Bar Too Tall on the Right DEBT MATURITY SCHEDULE AS OF JUNE 30, 2020 (1)(2) DEBT PROFILE (U.S. $ in billions) 98% Unsecured 6.7 3.0 % Unsecured Secured YEARS Weighted Avg. Weighted Avg. Maturity (1)(2) Coupon (1) $1.7 96% F
Slide 18: Consistent Execution on Strategic Vision
Consistent Execution on Strategic Vision Delivering Current Results, Seeding Future Growth SUCCESSFUL 2Q20 INITIATIVES 1. Strengthening Connections with Customers Reached high-water mark for bookings and backlog $144 mm 2Q20 Total Bookings 2. Exceeding Expectations Beat quarterly consensus estimates
Slide 19: Appendix
Appendix DIGITAL REALTY | 2Q20 FINANCIAL RESULTS | JULY 30, 2020 | 19
Slide 20: Robust Long-Term Demand, Lumpy Near-Term Signings
Robust Long-Term Demand, Lumpy Near-Term Signings Diverse Customer Base HISTORICAL BOOKINGS TRAILING FOUR-QUARTER AVERAGE ANNUALIZED GAAP BASE RENT $ in millions Space & Power Interconnection $100 $75 $50 $25 $0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2Q20 TRAILING FOUR-QUARTER AVERAG
Slide 21: Firm Fundamentals: Robust Demand, Rational Supply
Firm Fundamentals Robust Demand, Rational Supply NORTH AMERICA EMEA APAC 2,714 3,206 1,442 1,250 935 1,032 2Q19 2Q20 2Q19 2Q20 2Q19 2Q20 MEGAWATTS COMMISSIONED (1)(2) MEGAWATTS COMMISSIONED (1)(2) MEGAWATTS COMMISSIONED (1)(2) 90% 88% 90% 77% 88% 85% DIGITAL DIGITAL DIGITAL REGION REGION REGION REAL
Slide 22: 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 23: 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 24: Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent Digital Realty Trust, Inc. and Subsidiaries Digital Realty Trust, Inc. and Subsidiaries onciliation of Net Income Available to Common Stockholders to Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted
Slide 25: Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent Total Debt/Total Enterprise Value QE 6/30/20 Debt Service Ratio (LQA Adjusted EBITDA/GAAP interest expense plus capitalized interest (i) Market value of common equity $ 39,319,974 and less bridge facility fees) (ii) Liquidation value