Digital 9 Infrastructure PLC · LSE:DGI9
Digital 9 Infrastructure — FY2022 Earnings Presentation
28 slides from Digital 9 Infrastructure's earnings presentation, Mar 9, 2023
Slide 1: Full year 2022 results
See Change. Digital 9 Infrastructure plc Critical infrastructure for our connected world, Full year 2022 results with long-term, contracted, inflation-protected income
Slide 2: Presentation and Agenda
PRESENTATION AND AGENDA THE PRESENTATION TEAM AGENDA Highlights 3 Financial Review 5 Valuation & Portfolio Review 11 Ben Beaton Arnaud Jaguin Chris Flowers Outlook Investment Director 21 Fund Manager Finance Director Co-Managing Partner of Triple Former CFO and senior roles at Former Associate Direc
Slide 3: Highlights
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Slide 4: Key Updates
KEY UPDATES Total portfolio revenue 0.4x Invested or committed Diversified portfolio of 9 of £409m and EBITDA of Operating cash dividend c.£768m1 high-quality assets into 5 new acquisitions and pre- delivering strong performance in £206m2 cover line with expectation £226m3 EBITDA on a contracted wit
Slide 5: Financial Review
Financial Review
Slide 6: Financial Highlights as at 31 December 2022
FINANCIAL HIGHLIGHTS as at 31 December 2022 10.4% 109.76 pence £950 million 6.0 pence Total Return Annualised IFRS NAV per share IFRS NAV Dividend per share On a NAV performance basis, Total Return The NAV as at 31 December 2022 was since IPO was 23%, which represents the 109.76 pence per share, ref
Slide 7: Statement of Comprehensive Income
STATEMENT OF COMPREHENSIVE INCOME – PERIOD FROM 1 JANUARY 2022 TO 31 DECEMBER 2022 12-month period to 9-month period to £’m 31 December 2022 31 December 2021 £97.2m FAIR VALUE GAIN ON INVESTMENTS Unrealised fair value gain on financial 97.2 45.5 assets Fair value movement since acquisition: Distribu
Slide 8: Statement of Financial Position – 31 December 2022
STATEMENT OF FINANCIAL POSITION – 31 DECEMBER 2022 £’m 31 December 2022 31 December 2021 Investments at fair value through £949.6m 921.0 746.2 profit & loss IFRS NAV Trade and other receivables 1.4 0.3 Cash and cash equivalents 30.0 11.3 Total assets 952.4 757.8 109.76p Current liabilities (2.8) (1.
Slide 9: 4.9% NAV Increase Reflecting Strong Underlying Portfolio Gains
4.9% NAV INCREASE REFLECTING STRONG UNDERLYING PORTFOLIO GAINS 9
Slide 10: Cash and Fund-Level Financing
CASH AND FUND-LEVEL FINANCING £73 million of cash on a consolidated basis, with £44 million remaining undrawn of the £375 million RCF1 Margin Reduction & Covenants Net Debt / EBITDA Drawn RCF £331.2m • Interest rate payable can range between 3.25% and 3.75% per annum over Sterling Overnight Index Av
Slide 11: Valuation & Portfolio Review
Valuation & Portfolio Review
Slide 12: Portfolio Management: Creating Shareholder Value
PORTFOLIO MANAGEMENT: CREATING SHAREHOLDER VALUE Portfolio resourcing Portfolio integration Portfolio expansion Completed key senior hires Integrated Ficolo Oy and Deployed significant capital and optimised sector Volta under the Verne Global through 5 new acquisitions experience across the umbrella
Slide 13: Growing Underlying Asset Fair Value, New Assets and FX
GROWING UNDERLYING ASSET FAIR VALUE, NEW ASSETS AND FX, PARTLY OFFSET BY HIGHER OVERALL DISCOUNT RATE Evolution of portfolio gross asset value 23% IFRS valuation uplift since December 2021 from £746m to £921m: Aqua Comms net total return increasing by 18%, Verne by 8%, Arqiva by 18% and Elio Network
Slide 14: Slight Increase in Cost of Equity Despite Acquisition of Arqiva
SLIGHT INCREASE IN COST OF EQUITY DESPITE ACQUISITION OF ARQIVA AT LOWER COST OF CAPITAL Weighted average cost of equity shows a slight increase from Weighted average cost of equity and comparables1 12.56% (Dec-21) to 12.64% – key components: Risk premia have increased • Proxies for risk free rates,
Slide 15: Portfolio KPIs as at December 2022
PORTFOLIO KPIs as at 31 December 2022 Long-term, recurring, contracted and largely inflation-protected revenue base in major currencies 7.1 years 66% Over 99% £206m £226m Weighted average remaining contract Recurring revenues with some form of Exposure to major currencies1 Portfolio EBITDA Portfolio
Slide 16: Asset Investment Strategy: Subsea Fibre Platform
ASSET INVESTMENT STRATEGY: SUBSEA FIBRE PLATFORM EMIC-1 Providing the backbone to the internet in the Northern Hemisphere and Asia £257m Valuation Business Update Financial Highlights • In September 2022, completed the acquisition of Openbyte, supporting a carrier-neutral December 2022 LTM % growth
Slide 17: Asset Investment Strategy: Data Centre Platform
ASSET INVESTMENT STRATEGY: DATA CENTRE PLATFORM ICELAND | FINLAND | LONDON Shifting energy-intensive, latency-insensitive data sets to geographies with low-cost green power £535m Providing critical interconnectivity and low-latency solutions in dense urban centres Valuation Business Update Financial
Slide 18: Asset Investment Strategy: Wireless Platform (FWA)
ASSET INVESTMENT STRATEGY: WIRELESS PLATFORM (FWA) Providing reliable internet to Dublin’s underserved high-end business broadband market £59m Valuation Business Update Financial Highlights • Leading enterprise broadband provider in Greater Dublin, 100% owned by D9 December 2022 LTM % growth y-o-y •
Slide 19: Asset Investment Strategy: Wireless Platform (Broadcasting and IoT)
ASSET INVESTMENT STRATEGY: WIRELESS PLATFORM (BROADCASTING AND IoT) The only UK provider of national TV and Radio broadcasting £355m A leading Internet of Things (IoT) platform Valuation Business Update Financial Highlights • 48%1 stake acquired in October 2022 for £300m cash plus a c.£163m vendor l
Slide 20: Asset Investment Strategy: Terrestrial Fibre Platform
ASSET INVESTMENT STRATEGY: TERRESTRIAL FIBRE PLATFORM Revolutionary fibre-to-the-home product representing truly affordable broadband in Glasgow £3m Investment Business Update Financial Highlights • Fibre-to-the-home (“FTTH”) development opportunity in Glasgow December 2022 LTM % growth y-o-y • Prov
Slide 21: Outlook
Outlook
Slide 22: Dividend Cover Expected to Increase as Data Centre Platform Ramps Up
DIVIDEND COVER EXPECTED TO INCREASE AS DATA CENTRE PLATFORM RAMPS UP AND INFLATION NORMALISES EBITDA to OCF Bridge £'000 EBITDA 206,294 (-) Cash tax (428) DC Platform Ramp-up: + c.£21m (-) Δ Working Capital (13,825) Verne Global Iceland, Verne London, and Verne Global Finland, once fully ramped, are
Slide 23: Key Post Balance Sheet Events
KEY POST BALANCE SHEET EVENTS Significant progress on the $100m debt facility term sheet Recruitment of Head of Digital syndication of a minority stake in agreed Infrastructure progressing existing investee companies Working with a leading global Facility to be provided to one of the High quality ca
Slide 24: Key Takeaways
KEY TAKEAWAYS Strong portfolio performance, Strong growth pipeline ahead, Significant progress on and annual returns above reflected in £223m capex minority stake syndication target pipeline for 2023 Op. cash dividend cover to Agreed term sheet for $100m Reaffirming target aggregate increase progres
Slide 25: Appendix
Appendix
Slide 26: IFRS Valuation by Asset: Dec 21 to Dec 22
IFRS VALUATION BY ASSET: Dec 21 to Dec 22 £355m £329m £269m £235m £195m £132m £59m £56m £23m £16m £18m £6m - - - - - £3m Aqua Comms EMIC-1 Verne Global Iceland SEUK-1 Elio Networks Verne Global London Verne Global Finland Arqiva Giggle Fibre Q4 21 Q4 22 26
Slide 27: Disclaimer
DISCLAIMER THIS DOCUMENT IS STRICTLY CONFIDENTIAL AND IS BEING PROVIDED TO YOU SOLELY FOR GENERAL INFORMATION ONLY REGARDING DIGITAL 9 INFRASTRUCTURE PLC. INVESTORS SHOULD NOT SUBSCRIBE FOR OR PURCHASE SHARES ON THE BASIS OF INFORMATION CONTAINED IN THIS PRESENTATION OR IN RELIANCE ON THIS PRESENTAT
Slide 28: Thank You for Attending
U2? INFRASTRUCTURE THANK YOU FOR ATTENDING
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