34 slides from Iron Mountain Incorporated (delaware)'s earnings presentation, Feb 20, 2015
Slide 1: Earnings Commentary and Supplemental Information Fourth Quarter 2014
Earnings Commentary and Supplemental Information Fourth Quarter 2014 Unaudited
Slide 2: Safe Harbor Statement
Safe Harbor Statement 2 Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: This presentation contains certain forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws and is subject to the sa fe -
Slide 3: Table of Contents
All figures except per share and facility counts in 000s unless noted All figures in R$ unless noted Figures may not foot due to rounding Table of Contents 3 Investor Relations Contacts: Faten Freiha, 617-535-8404 Director, Investor Relations faten.freiha@ironmountain.com Melissa Marsden, 617-535-85
Slide 4: Earnings Commentary
Earnings Commentary 4 Reconciliation of Non-GAAP Measures: Throughout this document, Iron Mountain will discuss (1) Adjusted Operating Income Before Depreciation, Amortization, Intangible Impairments, (Gain) Loss on Disposal / Write-down of Property, Plant and Equipment, Net (Excluding Real Estate)
Slide 5: Earnings Commentary
Earnings Commentary 5 In support of its strategic plan, during 2014, the company: Improved customer retention and increased positive volume growth by 0.5% in the North American Records Management (RM) business and 12.3% in the International business, supporting global Records Management net volume g
Slide 6: Company Profile
Company Profile Iron Mountain is a global leader in enterprise storage with a high-return, real estate-based, business model, yielding revenues over $3 billion per annum. The company provides storage and information management services to a high-quality, diversified customer base across numerous ind
Slide 7: Financial Highlights
Financial Highlights 8 (1) Ordinary dividends per share for Q4 2014 and FY 2014 include a “catch-up” distribution of $0.255 per share or $53 million in total. The board declared a catch-up dividend because dividends in the first half of the year were declared and paid before the board had determined
Slide 8: Components of Year-over-Year Revenue Growth
Components of Year-over-Year Revenue Growth 9 Net Volume Growth Rate Records Management Volume Growth Q4-14 3.6% -1.9% -4.4% 5.9% 2.2% 1.7% Q3-14 5.5% -1.9% -4.5% 6.1% 2.1% 3.7% Q2-14 7.6% -2.0% -4.7% 6.1% 2.2% 5.9% Q1-14 6.7% -2.3% -4.5% 6.2% 2.1% 5.2% Q4-13 5.8% -2.5% -4.6% 6.3% 2.1% 4.5% Q3-13 3.
Slide 9: Guidance Summary
Guidance Summary 10 Financial Performance Outlook (1) YOY growth compared to 2014 constant dollar (C$) budget rates; includes 0% - 2% internal revenue growth (2) Assumes 212 million shares outstanding (3) AFFO (New Definition) is defined in the appendix (page 30) and further adjusts for Non-Real Est
Slide 10: FY 2014 Results Compared with Guidance
FY 2014 Results Compared with Guidance GrowthFY 2014 Results R$ 2014% Growth FY 2014 Guidance R$as of 9/30/2014 %Growth C$ $MM Operating Performance Operating Performance Revenue $3,118 3.1% 4.4% $3,100 - $3,150 1% - 5% Adjusted OIBDA(1) $926 3.5% 4.7% $925 - $945 2% - 5% Adjusted EPS – Fully Dilute
Slide 11: Quarterly Operating Performance
Quarterly Operating Performance 12 (1) Excludes certain costs and expenditures associated with the company’s conversion to a REIT Q4 Results (1) % Growth Q4 2013 Q4 2014 Reported - Impact of FX Rate Changes and Adjustments = Constant Currency - Impact of Acquisitions and Dispositions = Internal Grow
Slide 12: FY 2014 Operating Performance
FY 2014 Operating Performance 13 (1) Excludes certain costs and expenditures associated with the company’s conversion to a REIT FY Results (1) % Growth FY 2013 FY 2014 Reported - Impact of FX Rate Changes and Adjustments = Constant Currency - Impact of Acquisitions and Dispositions = Internal Growth
Slide 13: Consolidated Balance Sheets
Consolidated Balance Sheets 14 ASSETS 12/31/2013 12/31/2014 Current Assets: Cash and Cash Equivalents $120,526 $125,933 Restricted Cash 33,860 33,860 Accounts Receivable, Net 616,797 604,265 Other Current Assets 162,424 153,661 Total Current Assets 933,607 917,719 Property, Plant and Equipment: Prop
Slide 14: Consolidated Statements of Operations
Consolidated Statements of Operations 15 Q4 2013 Q4 2014 % Change FY 2013 FY 2014 % Change Revenues: Storage Rental $455,364 $465,401 2.2% $1,784,721 $1,860,243 4.2% Service 312,843 312,577 (0.1)% 1,239,902 1,257,450 1.4% Total Revenues $768,207 $777,978 1.3% $3,024,623 $3,117,693 3.1% Operating Exp
Slide 15: Reconciliation of Operating Income to Adjusted OIBDA
16 Reconciliation of Operating Income to Adjusted OIBDA (1) Includes realized and unrealized FX (gains) losses (2) Excludes realized and unrealized FX (gains) losses; FY 2013 includes $44 million loss on extinguishment of debt and FY 2014 includes $16 million Q4 2013 Q4 2014 % Change FY 2013 FY 2014
Slide 16: Reconciliation of Reported Earnings per Share to Adjusted Earnings per Share
17 Reconciliation of Reported Earnings per Share to Adjusted Earnings per Share(1) (1) The Adjusted EPS for the three and twelve months ended December 31, 2013 has been restated to reflect a structural tax rate of approximately 15% for comparability with 2014, the year in which the company’s convers
Slide 17: Reconciliation of Net Income Attributable to IRM to FFO & AFFO
18 Reconciliation of Net Income Attributable to IRM to FFO & AFFO (1) Includes realized and unrealized FX (gains) losses (2) Excludes realized and unrealized FX (gains) losses (3) Includes repatriation, recapture (including amended return impact) and other current tax expenses; excludes normalized c
Slide 18: Storage Net Operating Income (NOI)
19 Storage Net Operating Income (NOI) (1) Includes Fulfillment Services, Document Management Services, Intellectual Property Management, Data Center, Entertainment Services and other auxiliary services (2) Includes Building Maintenance, Property Taxes, Utilities and Insurance costs (3) Refer to ‘Com
Slide 19: Global Real Estate Portfolio
Global Real Estate Portfolio(1) 20 (1) Includes all real estate held in joint ventures (2) Adjustments to previous periods due to refinements to real estate basis and reclassification of multiple adjoining facilities into single buildings (3) Out of the 27 leased buildings additions and expansions,
Slide 20: Revenue from Rental Activities and Storage NOI per Racked Square Foot
Revenue from Rental Activities and Storage NOI per Racked Square Foot 21 (1) Square footage by region for the fourth quarter reflects a storage rental reclassification of 3 million square feet from Records Management to Other (2) Includes loading docks, unracked space, office space, common areas, as
Slide 21: Portfolio Utilization
Portfolio Utilization Records Management Storage Portfolio (CuFt MM) As of 12/31/2014 550 500 450 400 50 0 +13.4% Total IRM 378 +4.4% +1.5% +13.3% +9.9% 530 507 Asia Pacific Latin America Europe North America 384 650 600 550 500 100 450 50 0 Total IRM 636 580 83% 91% Asia Pacific 19 17 83% 94% Latin
Slide 22: Gross Book Value of Real Estate Assets
Gross Book Value of Real Estate Assets 23 (1) Includes warehouse equipment, vehicles, furniture, fixtures, computer hardware and software Real Estate Assets Storage Operations Land $197,927 Buildings & Building Improvements 1,393,479 Leasehold Improvements 432,242 Racking 1,453,372 Construction In P
Slide 23: Service Business Detail
Service Business Detail 24 (1) Includes Fulfillment Services, Document Management Services, Intellectual Property Management, Data Center, Consulting, Entertainment Services and other auxiliary services Q4 2014 FY 2014 Service Operations Revenue by Product Line Records Management $161,796 $642,372 D
Slide 24: Customer Data
Customer Data 25 (1) No single vertical within ‘Other’ comprises greater than 1% of North America Revenue Federal Healthcare Financial Legal Insurance Life Sciences Energy Business Services 36% Other 19% 3% 9% 16% 8% 4% 4% 3% North America FY 2014 Revenue by Vertical Iron Mountain provides storage a
Slide 25: Debt Schedule
Debt Schedule 26 (1) Includes $10 million of letters of credit and $3 million related to variances in FX rates (2) $306 million of the 8.375% bonds were called in December 2014 financed by the revolver Thereafter 2024 2023 2022 2021 $1,147 2020 2019 2018 $1,000 2017 2016 2015 2014 $600 $623 $279 $40
Slide 26: Capitalization
Capitalization 27 0.0 4.0 5.0 6.0 4.7x 5.0x 5.4x Net Lease Adjusted Leverage Ratio (1) Debt net of cash is calculated as total debt, including: total senior and subordinated notes of $4,359 million, capital leases of $203 million, other long-term debt of $65 million, and short-term portion of long-t
Slide 27: Lease Obligations
Lease Obligations(1) (1) Includes capital and operating lease obligations Weighted Average Remaining Lease Obligations (no exercise of extension options): 5.6 years Weighted Average Remaining Lease Obligations (exercise of all extension options): 12.4 years 2026 0.1% 2025 2.3% 2024 3.5% 2023 5.4% 20
Slide 28: Components of Value
Components of Value 29 (1) Trailing four quarter prior to rental expense (2) Includes Cash, Cash Equivalents, Restricted Cash, Accounts Receivable, Other Tangible Current Assets, Deferred Income Taxes and Prepaid Expenses (3) Includes Storage and Service Components Annualized NOI $ North America Rec
Slide 29: Appendix: Non-GAAP Measures
Appendix 30 Non-GAAP Measures Non-GAAP measures are supplemental metrics designed to enhance our disclosure and to provide additional information that we believe to be important for investors to consider when evaluating our financial performance. These non-GAAP measures should be considered in addit
Slide 30: Appendix: Non-GAAP Measures (continued)
Appendix Non-GAAP Measures (continued) Funds From Operations, or FFO (NAREIT), and FFO (Normalized) FFO is a non-GAAP financial measure commonly used in the REIT industry. FFO is defined by the National Association of Real Estate Investment Trusts (“NAREIT”) and us as net income excluding gains and
Slide 31: Appendix: Definitions
Appendix Definitions Building Investment – The cumulative sum of investment to date for all approved building projects in progress. Business Segments North American Records and Information Management Business (“RIM”) — Storage and information management services throughout the United States and Cana
Slide 32: Appendix: Definitions (continued)
Appendix 33 Definitions (continued) Capacity Measures Building Capacity – The maximum number of cubic feet of records or standard DPUs that can be stored in a given facility. Building Capacity Utilization – The number of cubic feet of records or standard DPUs in storage divided by the Building Capac
Slide 33: Appendix: Definitions (continued)
Appendix 34 Definitions (continued) Capital Expenditures Non-Real Estate (continued) Maintenance – These expenditures are primarily related to the purchase or replacement of customer-facing assets such as containers and shred bins, warehouse equipment, fixtures, computer hardware, or third-party or
Slide 34: Appendix: Definitions (continued)
Appendix 35 Definitions (continued) Lease Adjusted Leverage Ratio – The calculation for this ratio is EBITDA plus rent expense divided by net debt including the capitalized value of lease obligations. Net Volume Growth – New Records Management storage volume from existing customers, plus volume from