Digital Realty Trust, Inc. · NYSE:DLR
Digital Realty Trust — Investor Presentation (March 2024)
59 slides from Digital Realty Trust's investor presentation, March 2024
Slide 1: Global. Connected. Sustainable.
Global. Connected. Sustainable. INVESTOR PRESENTATION March 2024 The meeting place for companies, technologies and data
Slide 2: Business Update
Business Update Executing on our Strategic Priorities 2
Slide 3: Spotlight on Ashburn
Northern Virginia Spotlight on Ashburn Digital Loudoun Campus ~100 MWs Available for Lease Bldg 7 Bldg S Bldg M TOTAL MWs Available Thru 2025 48 40 8 96 ACC Additional MWs Available 48 8 - 56 in 2026+ Digital Loudoun III 632 MW White Space IT Load In-Place (1) M1 M2 Digital Loudoun IV 1+ GW Digital
Slide 4: Same-Capital Cash NOI Bridge: 2023 to 2024 Guidance
Same-Capital Cash NOI Bridge: 2023 to 2024 Guidance Normalized 2023 Growth is In Line with Normalized 2024 Guidance 2022 to 2023 Same-Capital Cash NOI Growth (1) 2024 Same-Capital Cash NOI Growth Guidance 2023 Guidance (2) 2024 Guidance (3) 3.0% – 4.0% 2.0% – 3.0% 7.5% 4.5 - 5.5% 4.5% 2.0 - 3.0% (2.
Slide 5: Net Debt to Adjusted EBITDA
Net Debt to Adjusted EBITDA(1) Diverse Menu Options, Minimizing Cost 6.2x 5.8x Announced or Completed Transactions in 2024: • Blackstone JV: $700M Buy-in • Cyxtera Resolution: 4 DC Sales & 2 Lease Buyouts • GI JV: Tops Up Interest in two assets from 65% to 80% 4Q23 Blackstone Buy-In Cyxtera & GI ATM
Slide 6: Mitsubishi Development Joint Venture Summary
Mitsubishi Development Joint Venture Summary Enables DLR to Re-Invest in Additional Data Center Capacity 100% Preleased to S&P 100 Investment Grade Company 35% 2 Data Centers in Dallas Metro 65% Ownership Ownership with initial 16 MW and option up to 48 MW Fees $800M ~$200M Enhance DLR Potential Pro
Slide 7: Digital Realty Overview
Digital Realty Overview Introduction 7
Slide 8: 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+ 220,000+ 50+ 300+ Customers (1) Cross connects (1) Metros (1) Data Centers (1) EQUITY & ENTERPRISE VALUE TOP PUBLICLY TRADED U.S. REIT $43 Bn $61 Bn 6th 2016 EQUITY MARKET ENTERPRISE LARGEST ADDE
Slide 9: Consistent Execution Against Strategic Priorities
Consistent Execution Against Strategic Priorities As of December 31, 2023 Global Expansion 1 Strengthen our Customer Value Proposition 2 Integrate & Innovate for our Customers 3 Diversifying and Bolstering Capital Sources o Executing Meeting o Building new o Partnering with Place strategy with appli
Slide 10: 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 237 MW delivered in 2023 ~2,500 MW total capacity in place >3,000 MW buildable IT capacity Geographically Diversified (1) 6% 10% North America EMEA 52% APAC 32% Latin Americ
Slide 11: 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 54 Cross 60 70 74 78 164 211 220 Connects (in 000s) European Telx DuPont Fabros Ascenty Interxion Teraco Portfolio Acquisition A Leading North America U.S. Provider of Colocation, Eight Highly-Con
Slide 12: Connected Campus Strategy
Connected Campus Strategy Solving for the Complete Deployment: Land and Expand 12
Slide 13: Global Connectivity Hubs
Global Connectivity Hubs Network Density that Promotes Innovation and Collaboration Amsterdam Atlanta Chicago 28+ 220K+ Science Park 56 Marietta St. 350 E. Cermak METROS CROSS-CONNECTS Globally Where Our GLOBALLY Internet Gateways Are Located Frankfurt Johannesburg London Hanauer Landstraße JB1 Isan
Slide 14: PlatformDIGITAL's Full Spectrum of Data Center Solutions
PlatformDIGITAL’s Full Spectrum of Data Center Solutions Provides Customers with a Secure Meeting Place CHICAGO CAMPUS NEW YORK CAMPUS DALLAS CAMPUS FRANKFURT CAMPUS 350 E. CERMAK 111 8th AVENUE 2323 BRYAN STREET HANAUER LANDSTRAßE Connect@Scale suites, Connect@Scale suites, Connect@Scale suites, Co
Slide 15: PlatformDIGITAL and ServiceFabric Designed for an Accelerating Digital Economy
PlatformDIGITAL® and ServiceFabric Designed for an Accelerating Digital Economy Enabling Enterprises to Harness Data Growth 15
Slide 16: The Digital Realty Difference
The Digital Realty Difference Digital Realty offers an open and flexible platform with a broad range of data center solutions that enables your business growth Our interconnection product suite simplifies cloud and ecosystem reach (including 3rd party data centers) Our portal capabilities enable dyn
Slide 17: ServiceFabric Connect Use Cases
ServiceFabric Connect Use Cases: Multi-Cloud Connectivity and Beyond Multi-Cloud Redundant Inter-metro/ Connectivity Disaster Service-chain Connectivity Cloud Inter-region to Ecosystems Recovery Multiple Connectivity Connectivity in 3rd Party Set-up Services Facilities One port to Redundant Connect
Slide 18: ServiceFabric Connect: Private Connections Made Easy
ServiceFabric Connect: Private Connections Made Easy 1 Establish a Port Customers establish a port which supports multiple virtual private connections Metro 2 Connect Customers establish direct, private connections to multiple Cloud Service Providers, Network Providers, SaaS Providers and other part
Slide 19: ServiceFabric Connect
ServiceFabric Connect Available in 35 Metros North America EMEA APAC 15 Metros 15 Metros 7 Metros Regional • 10G / 100G native ServiceFabric • 10G native ServiceFabric ports • 10G / 100G native Launch ports • 100G backbone ServiceFabric ports Capabilities • 100G backbone • Available from 75 sites •
Slide 20: Conservative Financial Strategy
Conservative Financial Strategy Committed to an Investment Grade Balance Sheet Supported by Multiple Funding Sources 20
Slide 21: Proven Track Record of Sustainable Growth
Proven Track Record of Sustainable Growth Disciplined Financial Management 2018 4Q23 Better/ Worse Change Properties / Data Centers (1) 214 309 44% Total Enterprise Value (2) $35 billion $61 billion 74% SIZE & DIVERSIFICATION RMZ Rank 5th 6th (3) Down One IG-equivalent AAA-rated Fortune 50 Top
Slide 22: Consistent Access to Capital
Consistent Access to Capital Portfolio Growth Financed by Match-Funding Access to Capital in Multiple Currencies Enables Digital Realty to Match-Fund across its Global Portfolio FULL MENU OF WELL-KNOWN, SEASONED ISSUER CAPITAL OPTIONS EQUITY RAISED SINCE 2009 ACROSS MULTIPLE CURRENCIES Unsecured S
Slide 23: 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) 6.9x 7.1x 6.8x 29% 6.4x 6.2x 6.2x 5.9x 5.8x 5.8x 5.7x 5.7x 4.9x Debt 4.4x 4.2x 4.1x 4.0x D
Slide 24: Significant De-Levering
Significant De-Levering Capital Recycling and ATM Issuance Bolster Liquidity Net Debt to Adjusted EBITDA(1) $4 Billion (2) Pro Forma Liquidity 1.3x Total Reduction in Leverage Stable December 14 5.8x 2023 (2) Pro Forma Leverage Credit Outlook May 5 <$1 Billion Debt Maturities in 2024 2023 Negative (
Slide 25: Executed on our Strategy to Diversify and Bolster Capital Sources
Executed on our Strategy to Diversify and Bolster Capital Sources ~$10 Billion of Net Proceeds Sourced through Hyperscale and Development JVs, and Asset Sales 1 Development JVs 2 Stabilized JVs 3 Non-Core / Land Dispos ► ~$7 Billion of Development JV ► $2.2 Billion of Stabilized JV ► $635 Million of
Slide 26: 4Q23 Financial Results
Financial Results 4Q23 Financial Results Note: Certain data in this section was originally posted to the Company’s website on February 15, 2024 and has not been updated to reflect changes occurring after that date. 26
Slide 27: High-Quality, Diversified Customer Base
High-Quality, Diversified TOP 20 CUSTOMERS Customer Base Customer Rank Locations % of Customer Rank Locations % of ARR (1) ARR (1) • Top customers have a 1. Fortune 50 Software Company 71 10.9% 11. Fortune 500 SaaS Provider 13 1.6% presence in 42 different 2. Social Content Platform 25 5.5% 12. 48 1
Slide 28: Connected Data Communities
Connected Data Communities Strong Interconnection Revenue 4Q23 Results 2023 Full-Year Results 134 506 new logos new logos $53M $204M total 4Q bookings from total 2023 bookings from 0-1 MW + Interconnection 0-1 MW + Interconnection 48% 44% of total 4Q bookings from of total 2023 bookings from 0-1 MW
Slide 29: Record Backlog
BACKLOG ROLL-FORWARD (1) COMMENCEMENT TIMING (2) Record Backlog $ in millions $ in millions Bodes Well for Future Growth $97M $84M $92M $75M $495M $27M $495M $482M $145M $22M • Record Backlog $120M of $495 Million $421M $426M $322M $426M • Two-Thirds to $285M Commence in 2024 3Q23 Backlog Signed Com
Slide 30: 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 25% 4.0% – 6.0% 2024 Guidance (2) for cash rental rate on • Shorter term 0-1 MW 20% renewals leases provide near term opportunities to 15% drive price increases 10% 4.6 years
Slide 31: Strong Pricing Environment
Strong Pricing 4Q23 RENEWAL SPREADS Environment Robust Renewal Spreads 0-1 MW > 1 MW OTHER (1) TOTAL RENTAL RATE CHANGE RENTAL RATE CHANGE RENTAL RATE CHANGE RENTAL RATE CHANGE 5.9% 12.8% 4.4% 8.2% • Highest Cash Renewal CASH CASH CASH CASH Spreads since 2015 5.6% 20.0% 18.6% 10.6% GAAP GAAP GAAP GA
Slide 32: Revenue Exposure by Currency
EXPOSURE BY REVENUE (1) 50% 25% 6% 6% 4% 3% 2% 2% 1% 1% <1% Revenue Exposure USD EURO GBP SGD ZAR BRL JPY CHF CAD AUD OTHER by Currency 1% 6% <1% <1% FX Slight Tailwind in the 25% 2% Fourth Quarter 50% <1% 2% <1% <1% 5% <1% • Local Operations Funded 3% <1% in Local Currencies act as 4% 1% a Natural
Slide 33: Matching the Duration of Assets and Liabilities
$ Matching the Duration of Assets and Liabilities ₣ Modest Near-Term Maturities, Well-Laddered Debt Schedule DEBT PROFILE DEBT MATURITY SCHEDULE AS OF DECEMBER 31, 2023 (1)(2) (U.S. $ in billions) $2.7 Unsecured $3.3 97% Secured 4.4 YEARS 2.7 % Unsecured Weighted Avg. € Weighted Avg. Maturity (1)(2)
Slide 34: Healthy Demand Across Regions and Products
HISTORICAL BOOKINGS Healthy Demand ANNUALIZED GAAP BASE RENT $ in millions Across Regions and Products $150.0 AI lifts demand $100.0 • Strong 0-1MW + $50.0 Interconnection signings • Record High >1 MW $0.0 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 average leasing rate 4Q23 BOOKINGS 0-1 MW IN
Slide 35: 2024 Financial Guidance
2024 Financial Guidance (1) Actual 2023 Full Year 2024 Total Revenue $5,477 $5,550 – $5,650 Adjusted EBITDA $2,750 $2,800 – $2,900 Rental Rates on Renewals Leases (Cash) 6.8% 4.0% – 6.0% Year-End Portfolio Occupancy 81.7% +100 – 200 bps Same-Capital Cash NOI Growth 7.5% 2.0% – 3.0% Core FFO per Shar
Slide 36: 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 36
Slide 37: 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 any
Slide 38: Serving a Social Purpose
Serving a Social Purpose Delivering Growth for All Stakeholders Social Governance Newsweek’s America’s Most Aligned ownership requirements to Responsible Companies of 2023 amend bylaws consistent with SEC 2023 standard Top 100 ranking on JUST Capital Enhanced Board diversity to 44% female America’s
Slide 39: Positioned for Long-Term Sustainable Growth
Positioned for Long-Term Sustainable Growth 2024 Setting the Stage to Meet Next Wave of Customer Demand Balance Accelerating Platform & Sheet Opportunity Capacity to Positioned Ahead Drive For Growth Returns Over $12 Billion(1) of Capital and Continued Growth in the Global Footprint in Core Commitme
Slide 40: Appendix
Presenter Name 15/09/22 Appendix
Slide 41: 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 42: 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 43: Reconciliation of Non-GAAP Items
Reconciliation of Digital Realty Trust, Inc. and Subsidiaries Non-GAAP Items Reconciliation of Net Income Available to Common Stockholders to Funds From Operations (FFO) (in thousands, except per share and unit data) (unaudited) To Their Closest GAAP Three Months Ended December 31, 2023 December 31,
Slide 44: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items Digital Realty Trust, Inc. and Subsidiaries To Their Closest GAAP Reconciliation of Funds From Operations (FFO) to Core Funds From Operations (CFFO) (in thousands, except per share and unit data) Equivalent (unaudited) Three Months Ended Twelve Months Ended December
Slide 45: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Net Income Available to Common Stockholders to Earnings To Their Closest GAAP Before Interest, Taxes, Depreciation and Amortization (EBITDA) and Adjusted EBITDA (in thousands) Equivalent (unaudited) Three
Slide 46: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Same Capital Cash Net Operating Income (in thousands) (unaudited) To Their Closest GAAP Three Months Ended December 31, 2022 December 31, 2021 Twelve Months Ended December 31, 2022 December 31, 2021 Equiva
Slide 47: Reconciliation of Non-GAAP Items
Reconciliation of Digital Realty Trust, Inc. and Subsidiaries Reconciliation of Same Capital Cash Net Operating Income (in thousands) Non-GAAP Items (unaudited) Three Months Ended Twelve Months Ended To Their Closest GAAP December 31, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Equiva
Slide 48: Reconciliation of Non-GAAP Items
Reconciliation of Non-GAAP Items To Their Closest GAAP Equivalent 48
Slide 49: Reconciliation of Net Debt/LQA Adjusted EBITDA
Reconciliation of Net Debt/LQA Adjusted EBITDA in 000’s QE 3/31/22 Net Debt/LQA Adjusted EBITDA - As Adjusted QE 3/31/22 Non-GAAP Items Net Debt as of March 31, 2022 $ 15,184,306 Total debt at balance sheet carrying value $ 14,388,215 Less: Gross Proceeds from Forward Equity (947,405) Add: DLR share
Slide 50: Reconciliation of Net Debt/LQA Adjusted EBITDA
Reconciliation of Net Debt/LQA Adjusted EBITDA in 000’s QE 6/30/22 Net Debt/LQA Adjusted EBITDA - As Adjusted QE 6/30/22 Non-GAAP Items Total debt at balance sheet carrying value $ 14,294,307 Net Debt as of June 30, 2022 $ 15,104,319 Less: Gross Proceeds from Forward Equity (939,787) Add: DLR share
Slide 51: Reconciliation of Net Debt/LQA Adjusted EBITDA
Reconciliation of Net Debt/LQA Adjusted EBITDA QE 9/30/22 Fixed Charged Ratio (LQA Adjusted EBITDA/total fixed charges) QE 9/30/22 Non-GAAP Items Total debt at balance sheet carrying value $ 15,758,509 Add: DLR share of unconsolidated joint venture debt 794,087 GAAP interest expense plus capitalized
Slide 52: Reconciliation of Non-GAAP Items
Net Debt/LQA Adjusted EBITDA QE 12/31/22 Total debt at balance sheet carrying value $ 16,596,803 Reconciliation of Add: DLR share of unconsolidated joint venture debt 906,210 Add: Capital lease obligations, net 325,228 Non-GAAP Items Less: Unrestricted cash (315,949) Net Debt as of September 30, 202
Slide 53: 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 54: 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 55: 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 56: 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 57: 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 58: Net Debt/LQA Adjusted EBITDA
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 59: Thank you
r Thank you FN DIGITAL Lv REALTY.
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