Digital Realty Trust, Inc. · NYSE:DLR
Digital Realty Trust — Q3 2013 Earnings Presentation
20 slides from Digital Realty Trust's earnings presentation, Oct 30, 2013
Slide 1: 3Q13 Earnings Conference Call Presentation
3Q13 Earnings Conference Call Presentation October 30, 2013 DIGITAL REALTY Data Center Solutions ROY i MAY Mit Xt SS ANN, AN ULL CL TL CLL WM AMAA ii N . ANN
Slide 2: Third highest lease signing quarter in the company's history
Third highest lease signing quarter in the company’s history Annualized GAAP Base Annualized GAAP Type of Space Total SF Signed Rent psf Base Rent Turn-Key FlexSM 265,327 $147 $39.1 million Custom Solutions 23,322 $173 $4.0 million Colocation 20,895 $165 $3.5 million Non-Technical 31,015 $23 $0.7 mi
Slide 3: Cash and GAAP rent % change by lease type
Turn-Key Flex SM Powered Base Building® Total Data Center 50% 40% 30% 20% 10% 0% -10% Cash Rent % Change GAAP Rent % Change
Slide 4: $59M of Stabilized NOI from leasing backlog expected to commence through FY14
$59M of Stabilized NOI from leasing backlog expected to commence through FY14 $ in millions $1,050 $1,000 $990 $7 $31 $952 $950 $13 $926 $24 $25 $15 $900 $850 $800 $750 3Q13 Annualized JV Dilution 3Q13 leases 4Q13 leasing FY14 leasing 2014 Contractual FY14 leasing 2015+ leasing 2015+ NOI (3) commenc
Slide 5: Digital Realty Inventory: surplus/shortfall in megawatts by market
in megawatts Surplus Shortfall Digital Realty Inventory 30 19 20 13 11 10 4 0 (2) Total U.S.: (3.2) (4) -10 -20 (21) (24) -30 Boston Chicago Dallas Houston N. Virginia NY Metro Phoenix Silicon Valley
Slide 6: Current supply and new construction in megawatts
in megawatts Current Supply New Construction 50 41 40 36 30 26 22 20 18 15 11 11 10 0 Boston Chicago Dallas Houston N. VA NY Metro Phoenix Silicon Valley
Slide 7: 2013 YTD signings have already surpassed full year 2012 activity
2013 YTD signings have already surpassed full year 2012 activity GAAP Annualized Base Rent in Millions TKF PBB Custom Solutions DC Master Lease Colo Non-Tech $160 $137 $120 $112 $112 $106 $107 $80 $64 $56 $40 $0 2007 2008 2009 2010 2011 2012 2013 YTD TKF Rates/PSF - $128 $153 $158 $172 $183 $162 $15
Slide 8: Digital Consulting Partners and Digital Services Partners
IT/Vertical Systems Consultants Digital Consulting Partners Integrators Digital Core Plus DIGITAL CORE Datacenter Space Advanced Power Fitouts Tools Tools Connectivity Value Equipment Added Resellers Leasing Managed Cloud Services Digital Services Partners Services Network Services
Slide 9: Continued focus on Large Enterprise
Continued focus on Large Enterprise Large Segment inside traditional verticals. Identified Ideal Customer Profiles to Enterprise drive account selection and retention. Heightened Focus with targets for deal velocity and regional MidMarket supply/demand fit. Optimized for Inside Sales and Alliance Pr
Slide 10: FFO per diluted share
FFO per diluted share $1.25 $1.22 $0.01 $0.04 $1.20 $0.07 $0.01 $0.01 $1.15 $0.07 $1.14 $0.01 $0.02 $1.10 $0.03 $1.10 $1.05 $1.00 2Q13 Reported 1Q13 OpEx 2Q13 Gain on 3Q13 Straight- 3Q13 Personal G&A and 3Q13 Reported JV dilution 3Q13 Straight- 3Q13 Personal Normalized Tax 3Q13 Reported FFO (1) capi
Slide 11: Core FFO per diluted share
Core FFO per diluted share $1.25 $1.20 $1.19 $0.01 $0.01 $0.01 $0.01 $1.16 $0.03 $0.01 $0.01 $1.15 $1.14 $1.10 $1.05 $1.00 2Q13 Core FFO (1) 1Q13 OpEx 3Q13 Straight-line 3Q13 Personal Net G&A, Interest 3Q13 Core FFO (1) JV Dilution 3Q13 Personal Normalized Tax 3Q13 Core FFO capitalization catch- ren
Slide 12: FFO per diluted share guidance
FFO per diluted share $4.85 $4.75 $0.07 $0.06 $0.03 $4.65 $0.01 $4.55 $0.08 $4.78 $4.45 $4.61 $4.35 $4.25 Mid-point of Prior 3Q13 straight-line Delayed leasing JV dilution Reduced Mid-point of Revised Incremental FY14E FFO 2013 FFO per rent expense adj commencements acquisitions 2013 FFO per JV dilu
Slide 13: Partner Prudential Real Estate Investors' Core Fund (PREI Fund)
Partner Prudential Real Estate Investors’ Core Fund (“PREI Fund”) Size / Proceeds $369 million(1) / $329 million(2) Formation Date September 27, 2013 Digital Realty 20% Ownership PREI Fund 80% Use of Proceeds Pay down debt and fund future investments Term Long-term hold(3) $185 milli
Slide 14: REIT Credit Comparables – BBB+ or Higher
REIT Credit Comparables – “BBB+” or Higher Digital Realty maintains a Flexible, Investment Grade Balance Sheet Net Debt / LQA EBITDA Total Debt + Preferred / Total Enterprise Value 50% 46% 44% 8.0x 7.3x 40% 6.2x 6.3x 6.4x 5.7x 40% 6.0x 5.3x 5.4x 36% 33% 4.0x 30% 26% 2.0x 25% 0.0x 20% FRT AVB KIM SPG
Slide 15: Appendix
G DIGITAL REALTY Data Center Solutions Appendix
Slide 16: Forward-looking statements
The information included in this presentation contains forward-looking statements. Such statements are based on management’s beliefs and assumptions made based on information currently available to management. Such forward-looking statements include statements relating to our expected development pl
Slide 17: Non-GAAP financial measures: Funds from Operations (FFO)
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 may differ from those of other REITs, and, therefor
Slide 18: EBITDA and Adjusted EBITDA definitions
Earnings Before Interest Taxes Depreciation and Amortization (EBITDA) and Adjusted EBITDA We believe that earnings before interest expense, income taxes, depreciation and amortization, or EBITDA and Adjusted EBITDA (as defined below), are useful supplemental performance measures because they allow i
Slide 19: Reconciliation of Net Income to Funds From Operations (FFO)
Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Net Income Available to Common Stockholders to Funds From Operations (FFO) Three Months Ended (in thousands, except per share and unit data) September 30, 2013 June 30, 2013 (unaudited) Three Months Ended FFO available to common stockhold
Slide 20: Reconciliation of Operating Income to NOI and projected FFO
Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Operating Income to Net Operating Income (NOI) A reconciliation of the range of 2013 projected net income to projected FFO and core FFO follows: (in thousands) (unaudited) Low - High Net income available to common stockholders per diluted