Maryland | 001-35789 | 46-0691837 | ||
(State of incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
Exhibit No. | Description | |
Date: August 1, 2018 | CYRUSONE INC. | |||
By: | /s/ Robert M. Jackson | |||
Robert M. Jackson | ||||
Executive Vice President, General Counsel | ||||
and Secretary |
Category | 2Q’18 | % Change vs. 2Q’17 |
Revenue | $196.9 million | 18% |
Net income | $105.9 million | n/m |
Adjusted EBITDA | $110.6 million | 22% |
Normalized FFO | $80.7 million | 19% |
Net income per diluted share | $1.06 | n/m |
Normalized FFO per diluted share | $0.81 | 5% |
• | Leased 52 megawatts (“MW”) and 305,000 colocation square feet (“CSF”) in the second quarter, totaling $65 million in annualized GAAP revenue, all company records |
– | Leasing results also included company records for number of leases signed (506), weighted average lease term (11.9 years on a CSF-weighted basis), and total interconnection revenue signed ($2.8 million annualized) |
– | Includes leases totaling more than 10 MW signed with two hyperscale customers based in China |
• | Backlog of $85 million in annualized GAAP revenue as of the end of the second quarter, representing nearly $850 million in total contract value |
• | Completed construction of a 350-foot telecommunications tower at the Aurora I facility, creating the first on-campus wireless access and supporting both microwave and millimeter wireless antenna colocation services for financial ecosystem customers |
• | Acquired 68 acres of land in Mesa, Arizona, and subsequent to the end of the quarter, acquired a 154,000 square foot shell in Northern Virginia with up to 33 MW of power capacity |
– | Transactions support the company’s continued growth in two of the strongest data center markets in the U.S. |
Category | Previous 2018 Guidance(1) | Revised 2018 Guidance(1) |
Total Revenue | $810 - 825 million | $820 - 830 million |
Lease and Other Revenues from Customers | $735 - 745 million | $725 - 730 million |
Metered Power Reimbursements | $75 - 80 million | $95 - 100 million |
Adjusted EBITDA | $460 - 470 million | $454 - 459 million |
Normalized FFO per diluted common share | $3.18 - 3.28 | $3.25 - 3.30 |
Capital Expenditures | $850 - 900 million | $850 - 900 million |
Development | $845 - 890 million | $845 - 890 million |
Recurring | $5 - 10 million | $5 - 10 million |
• | Cowen Communications Infrastructure Summit on August 6-7 in Boulder, CO |
• | Morgan Stanley Telecom & Media Corporate Access Day on August 9 in New York City |
• | Raymond James Park City Summit on August 14-15 in Park City, UT |
• | BMO Capital Markets Real Estate Conference on September 20-21 in Chicago, IL |
• | Bank of America Merrill Lynch Global Real Estate Conference on September 25-26 in New York City |
• |
• | Best-in-Class Sales Force |
• | Flexible Solutions that Scale as Customers Grow |
• | Massively Modular® Engineering with Data Hall Builds in 10-14 Weeks |
• | Focus on Operational Excellence and Superior Customer Service |
• | Proven Leading-Edge Technology Delivering Power Densities up to 900 Watts per Square Foot |
• | National IX Replicates Enterprise Data Center Architecture |
Corporate Headquarters | Senior Management | |
2101 Cedar Springs Road, Ste. 900 | Gary Wojtaszek, President and CEO | Jonathan Schildkraut, EVP & Chief Strategy Officer |
Dallas, Texas 75201 | Diane Morefield, EVP & Chief Financial Officer | Kellie Teal-Guess, EVP & Chief People Officer |
Phone: (972) 350-0060 | Kevin Timmons, EVP & Chief Technology Officer | Robert Jackson, EVP General Counsel & Secretary |
Website: www.cyrusone.com | Tesh Durvasula, EVP & Chief Commercial Officer | John Hatem, EVP Design, Construction & Operations |
Firm | Analyst | Phone Number |
Bank of America Merrill Lynch | Michael J. Funk | (646) 855-5664 |
Barclays | Amir Rozwadowski | (212) 526-4043 |
BMO Capital Markets | Ari Klein | (212) 885-4103 |
Citi | Mike Rollins | (212) 816-1116 |
Cowen and Company | Colby Synesael | (646) 562-1355 |
Credit Suisse | Sami Badri | (212) 538-1727 |
Deutsche Bank | Matthew Niknam | (212) 250-4711 |
Guggenheim Securities, LLC | Robert Gutman | (212) 518-9148 |
Jefferies | Jonathan Petersen | (212) 284-1705 |
J.P. Morgan | Richard Choe | (212) 622-6708 |
KeyBanc Capital Markets | Jordan Sadler | (917) 368-2280 |
MoffettNathanson | Nick Del Deo, CFA | (212) 519-0025 |
Morgan Stanley | Simon Flannery | (212) 761-6432 |
MUFG Securities | Stephen Bersey | (212) 405-7032 |
RBC Capital Markets | Jonathan Atkin | (415) 633-8589 |
Raymond James | Frank G. Louthan IV | (404) 442-5867 |
Stifel | Erik Rasmussen | (212) 271-3461 |
SunTrust Robinson Humphrey | Greg Miller | (212) 303-4169 |
UBS | John C. Hodulik, CFA | (212) 713-4226 |
Wells Fargo | Eric Luebchow | (312) 630-2386 |
William Blair | Jim Breen, CFA | (617) 235-7513 |
Three Months | |||||||||||
June 30, | March 31, | June 30, | Growth % | ||||||||
2018 | 2018 | 2017 | Yr/Yr | ||||||||
Revenue | $ | 196.9 | $ | 196.6 | $ | 166.9 | 18 | % | |||
Net operating income | 128.0 | 128.8 | 107.3 | 19 | % | ||||||
Net income (loss) | 105.9 | 43.5 | (0.8 | ) | n/m | ||||||
Funds from Operations ("FFO") - NAREIT defined | 175.7 | 110.2 | 58.1 | n/m | |||||||
Normalized Funds from Operations ("Normalized FFO") | 80.7 | 82.2 | 67.9 | 19 | % | ||||||
Weighted average number of common shares outstanding - diluted | 99.4 | 96.6 | 88.5 | 12 | % | ||||||
Income (loss) per share - basic | $ | 1.07 | $ | 0.45 | $ | (0.01 | ) | n/m | |||
Income (loss) per share - diluted | $ | 1.06 | $ | 0.45 | $ | (0.01 | ) | n/m | |||
Normalized FFO per diluted common share | $ | 0.81 | $ | 0.85 | $ | 0.77 | 5 | % | |||
Adjusted EBITDA | 110.6 | 109.5 | 90.8 | 22 | % | ||||||
Adjusted EBITDA as a % of Revenue | 56.2 | % | 55.7 | % | 54.4 | % | 1.8 pts |
As of | |||||||||||
June 30, | March 31, | June 30, | Growth % | ||||||||
2018 | 2018 | 2017 | Yr/Yr | ||||||||
Balance Sheet Data | |||||||||||
Gross investment in real estate | $ | 4,145.6 | $ | 3,954.6 | $ | 3,532.8 | 17 | % | |||
Accumulated depreciation | (900.3 | ) | (836.4 | ) | (679.6 | ) | 32 | % | |||
Total investment in real estate, net | 3,245.3 | 3,118.2 | 2,853.2 | 14 | % | ||||||
Cash and cash equivalents | 116.2 | 228.7 | 40.8 | n/m | |||||||
Market value of common equity | 5,784.3 | 5,066.4 | 5,089.5 | 14 | % | ||||||
Long-term debt | 2,200.0 | 2,200.0 | 1,857.7 | 18 | % | ||||||
Net debt | 2,098.7 | 1,987.2 | 1,829.4 | 15 | % | ||||||
Total enterprise value | 7,883.0 | 7,053.6 | 6,918.9 | 14 | % | ||||||
Net debt to LQA Adjusted EBITDA | 4.7x | 4.5x | 5.0x | (0.3)x | |||||||
Dividend Activity | |||||||||||
Dividends per share | $ | 0.46 | $ | 0.46 | $ | 0.42 | 10 | % | |||
Portfolio Statistics | |||||||||||
Data centers | 43 | 45 | 40 | 8 | % | ||||||
Stabilized CSF (000) | 3,097 | 3,024 | 2,380 | 30 | % | ||||||
Stabilized CSF % leased | 92 | % | 92 | % | 93 | % | (1) pt | ||||
Total CSF (000) | 3,369 | 3,348 | 2,575 | 31 | % | ||||||
Total CSF % leased | 88 | % | 86 | % | 89 | % | (1) pt | ||||
Total NRSF (000) | 5,842 | 5,824 | 4,783 | 22 | % | ||||||
Three Months | Six Months | |||||||||||||||||||||
Ended June 30, | Change | Ended June 30, | Change | |||||||||||||||||||
2018 | 2017 | $ | % | 2018 | 2017 | $ | % | |||||||||||||||
Revenue: | ||||||||||||||||||||||
Lease and other revenues from customers | $ | 172.4 | $ | 151.1 | $ | 21.3 | 14 | % | $ | 347.6 | $ | 285.3 | $ | 62.3 | 22 | % | ||||||
Metered power reimbursements | 24.5 | 15.8 | 8.7 | 55 | % | 45.9 | 30.9 | 15.0 | 49 | % | ||||||||||||
Revenue | $ | 196.9 | $ | 166.9 | $ | 30.0 | 18 | % | 393.5 | 316.2 | 77.3 | 24 | % | |||||||||
Operating expenses: | ||||||||||||||||||||||
Property operating expenses | 68.9 | 59.6 | 9.3 | 16 | % | 136.7 | 111.9 | 24.8 | 22 | % | ||||||||||||
Sales and marketing | 4.4 | 4.3 | 0.1 | 2 | % | 9.7 | 9.2 | 0.5 | 5 | % | ||||||||||||
General and administrative | 18.6 | 17.3 | 1.3 | 8 | % | 37.9 | 33.1 | 4.8 | 15 | % | ||||||||||||
Depreciation and amortization | 77.6 | 63.7 | 13.9 | 22 | % | 152.2 | 119.4 | 32.8 | 27 | % | ||||||||||||
Transaction, acquisition, integration and other related expenses | 0.4 | 1.7 | (1.3 | ) | (76 | )% | 2.3 | 2.5 | (0.2 | ) | (8 | )% | ||||||||||
Asset impairments | — | 3.6 | (3.6 | ) | n/m | — | 3.6 | (3.6 | ) | n/m | ||||||||||||
Total operating expenses | 169.9 | 150.2 | 19.7 | 13 | % | 338.8 | 279.7 | 59.1 | 21 | % | ||||||||||||
Operating income | 27.0 | 16.7 | 10.3 | 62 | % | 54.7 | 36.5 | 18.2 | 50 | % | ||||||||||||
Interest expense | (22.8 | ) | (16.5 | ) | (6.3 | ) | 38 | % | (43.6 | ) | (30.1 | ) | (13.5 | ) | 45 | % | ||||||
Unrealized gain on marketable equity investment | 102.7 | — | 102.7 | n/m | 143.2 | — | 143.2 | n/m | ||||||||||||||
Loss on early extinguishment of debt | — | (0.3 | ) | 0.3 | n/m | (3.1 | ) | (36.5 | ) | 33.4 | n/m | |||||||||||
Net income (loss) before income taxes | 106.9 | (0.1 | ) | 107.0 | n/m | 151.2 | (30.1 | ) | 181.3 | n/m | ||||||||||||
Income tax expense | (1.0 | ) | (0.7 | ) | (0.3 | ) | 43 | % | (1.8 | ) | (1.1 | ) | (0.7 | ) | 64 | % | ||||||
Net income (loss) | $ | 105.9 | $ | (0.8 | ) | $ | 106.7 | n/m | $ | 149.4 | $ | (31.2 | ) | $ | 180.6 | n/m | ||||||
Income (loss) per share - basic | $ | 1.07 | $ | (0.01 | ) | $ | 1.08 | n/m | $ | 1.53 | $ | (0.37 | ) | $ | 1.90 | n/m | ||||||
Income (loss) per share - diluted | $ | 1.06 | $ | (0.01 | ) | $ | 1.07 | n/m | $ | 1.52 | $ | (0.37 | ) | $ | 1.89 | n/m |
June 30, | December 31, | Change | |||||||||
2018 | 2017 | $ | % | ||||||||
Assets | |||||||||||
Investment in real estate: | |||||||||||
Land | $ | 107.4 | $ | 104.6 | $ | 2.8 | 3 | % | |||
Buildings and improvements | 1,461.1 | 1,371.4 | 89.7 | 7 | % | ||||||
Equipment | 2,050.3 | 1,813.9 | 236.4 | 13 | % | ||||||
Gross operating real estate | 3,618.8 | 3,289.9 | 328.9 | 10 | % | ||||||
Less accumulated depreciation | (900.3 | ) | (782.4 | ) | (117.9 | ) | 15 | % | |||
Net operating real estate | 2,718.5 | 2,507.5 | 211.0 | 8 | % | ||||||
Construction in progress, including land under development | 452.6 | 487.1 | (34.5 | ) | (7 | )% | |||||
Land held for future development | 74.2 | 63.8 | 10.4 | 16 | % | ||||||
Total investment in real estate, net | 3,245.3 | 3,058.4 | 186.9 | 6 | % | ||||||
Cash and cash equivalents | 116.2 | 151.9 | (35.7 | ) | (24 | )% | |||||
Rent and other receivables, net | 87.7 | 87.2 | 0.5 | 1 | % | ||||||
Equity investment | 318.8 | 175.6 | 143.2 | 82 | % | ||||||
Goodwill | 455.1 | 455.1 | — | — | % | ||||||
Intangible assets, net | 190.5 | 203.0 | (12.5 | ) | (6 | )% | |||||
Other assets | 215.1 | 180.9 | 34.2 | 19 | % | ||||||
Total assets | $ | 4,628.7 | $ | 4,312.1 | $ | 316.6 | 7 | % | |||
Liabilities and equity | |||||||||||
Debt, net | $ | 2,179.5 | $ | 2,089.4 | $ | 90.1 | 4 | % | |||
Capital lease obligations | 14.9 | 10.1 | 4.8 | 48 | % | ||||||
Lease financing arrangements | 127.8 | 131.9 | (4.1 | ) | (3 | )% | |||||
Construction costs payable | 113.3 | 115.5 | (2.2 | ) | (2 | )% | |||||
Accounts payable and accrued expenses | 91.4 | 97.9 | (6.5 | ) | (7 | )% | |||||
Dividends payable | 46.5 | 41.8 | 4.7 | 11 | % | ||||||
Deferred revenue and prepaid rents | 127.1 | 111.6 | 15.5 | 14 | % | ||||||
Total liabilities | 2,700.5 | 2,598.2 | 102.3 | 4 | % | ||||||
Stockholders' equity | |||||||||||
Preferred stock, $.01 par value, 100,000,000 authorized; no shares issued or outstanding | — | — | — | — | % | ||||||
Common stock, $.01 par value, 500,000,000 shares authorized and 99,114,112 and 96,137,874 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 1.0 | 1.0 | — | — | % | ||||||
Additional paid in capital | 2,281.5 | 2,125.6 | 155.9 | 7 | % | ||||||
Accumulated deficit | (353.0 | ) | (486.9 | ) | 133.9 | (28 | )% | ||||
Accumulated other comprehensive income (loss) | (1.3 | ) | 74.2 | (75.5 | ) | n/m | |||||
Total stockholders’ equity | 1,928.2 | 1,713.9 | 214.3 | 13 | % | ||||||
Total liabilities and equity | $ | 4,628.7 | $ | 4,312.1 | $ | 316.6 | 7 | % |
For the three months ended: | June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||
2018 | 2018 | 2017 | 2017 | 2017 | |||||||||||
Revenue: | |||||||||||||||
Lease and other revenues from customers | $ | 172.4 | $ | 175.2 | $ | 161.6 | $ | 155.5 | $ | 151.1 | |||||
Metered power reimbursements | 24.5 | 21.4 | 18.9 | 19.8 | 15.8 | ||||||||||
Revenue | 196.9 | 196.6 | 180.5 | 175.3 | 166.9 | ||||||||||
Operating expenses: | |||||||||||||||
Property operating expenses | 68.9 | 67.8 | 60.2 | 63.0 | 59.6 | ||||||||||
Sales and marketing | 4.4 | 5.3 | 3.9 | 3.9 | 4.3 | ||||||||||
General and administrative | 18.6 | 19.3 | 16.4 | 17.5 | 17.3 | ||||||||||
Depreciation and amortization | 77.6 | 74.6 | 70.8 | 68.7 | 63.7 | ||||||||||
Transaction, acquisition, integration and other related expenses | 0.4 | 1.9 | 5.3 | 4.1 | 1.7 | ||||||||||
Asset impairments | — | — | — | 54.4 | 3.6 | ||||||||||
Total operating expenses | 169.9 | 168.9 | 156.6 | 211.6 | 150.2 | ||||||||||
Operating income | 27.0 | 27.7 | 23.9 | (36.3 | ) | 16.7 | |||||||||
Interest expense | (22.8 | ) | (20.8 | ) | (20.1 | ) | (17.9 | ) | (16.5 | ) | |||||
Unrealized gain on marketable equity investment | 102.7 | 40.5 | — | — | — | ||||||||||
Loss on early extinguishment of debt | — | (3.1 | ) | — | — | (0.3 | ) | ||||||||
Net income (loss) before income taxes | 106.9 | 44.3 | 3.8 | (54.2 | ) | (0.1 | ) | ||||||||
Income tax expense | (1.0 | ) | (0.8 | ) | (1.0 | ) | (0.9 | ) | (0.7 | ) | |||||
Net income (loss) | $ | 105.9 | $ | 43.5 | $ | 2.8 | $ | (55.1 | ) | $ | (0.8 | ) | |||
Income (loss) per share - basic | $ | 1.07 | $ | 0.45 | $ | 0.03 | $ | (0.61 | ) | $ | (0.01 | ) | |||
Income (loss) per share - diluted | $ | 1.06 | $ | 0.45 | $ | 0.03 | $ | (0.61 | ) | $ | (0.01 | ) |
June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||
2018 | 2018 | 2017 | 2017 | 2017 | |||||||||||
Assets | |||||||||||||||
Investment in real estate: | |||||||||||||||
Land | $ | 107.4 | $ | 104.6 | $ | 104.6 | $ | 102.8 | $ | 94.0 | |||||
Buildings and improvements | 1,461.1 | 1,400.8 | 1,371.4 | 1,344.0 | 1,291.7 | ||||||||||
Equipment | 2,050.3 | 1,959.5 | 1,813.9 | 1,721.2 | 1,525.3 | ||||||||||
Gross operating real estate | 3,618.8 | 3,464.9 | 3,289.9 | 3,168.0 | 2,911.0 | ||||||||||
Less accumulated depreciation | (900.3 | ) | (836.4 | ) | (782.4 | ) | (722.1 | ) | (679.6 | ) | |||||
Net operating real estate | 2,718.5 | 2,628.5 | 2,507.5 | 2,445.9 | 2,231.4 | ||||||||||
Construction in progress, including land under development | 452.6 | 435.3 | 487.1 | 429.4 | 569.1 | ||||||||||
Land held for future development | 74.2 | 54.4 | 63.8 | 58.7 | 52.7 | ||||||||||
Total investment in real estate, net | 3,245.3 | 3,118.2 | 3,058.4 | 2,934.0 | 2,853.2 | ||||||||||
Cash and cash equivalents | 116.2 | 228.7 | 151.9 | 24.7 | 40.8 | ||||||||||
Rent and other receivables, net | 87.7 | 93.1 | 87.2 | 89.2 | 88.7 | ||||||||||
Equity investment | 318.8 | 216.1 | 175.6 | — | — | ||||||||||
Goodwill | 455.1 | 455.1 | 455.1 | 455.1 | 455.1 | ||||||||||
Intangible assets, net | 190.5 | 196.8 | 203.0 | 209.7 | 216.3 | ||||||||||
Other assets | 215.1 | 190.3 | 180.9 | 171.1 | 162.5 | ||||||||||
Total assets | $ | 4,628.7 | $ | 4,498.3 | $ | 4,312.1 | $ | 3,883.8 | $ | 3,816.6 | |||||
Liabilities and equity | |||||||||||||||
Debt, net | $ | 2,179.5 | $ | 2,178.3 | $ | 2,089.4 | $ | 2,013.7 | $ | 1,832.5 | |||||
Capital lease obligations | 14.9 | 15.9 | 10.1 | 10.9 | 11.7 | ||||||||||
Lease financing arrangements | 127.8 | 131.3 | 131.9 | 133.3 | 134.0 | ||||||||||
Construction costs payable | 113.3 | 89.0 | 115.5 | 133.6 | 163.4 | ||||||||||
Accounts payable and accrued expenses | 91.4 | 66.7 | 97.9 | 71.5 | 73.2 | ||||||||||
Dividends payable | 46.5 | 46.4 | 41.8 | 39.6 | 39.4 | ||||||||||
Deferred revenue and prepaid rents | 127.1 | 116.1 | 111.6 | 104.8 | 96.5 | ||||||||||
Total liabilities | 2,700.5 | 2,643.7 | 2,598.2 | 2,507.4 | 2,350.7 | ||||||||||
Stockholders' equity | |||||||||||||||
Preferred stock, $.01 par value, 100,000,000 authorized; no shares issued or outstanding | — | — | — | — | — | ||||||||||
Common stock, $.01 par value, 500,000,000 shares authorized and 99,114,112 and 96,137,874 shares issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 1.0 | 1.0 | 1.0 | 0.9 | 0.9 | ||||||||||
Additional paid in capital | 2,281.5 | 2,268.0 | 2,125.6 | 1,826.0 | 1,821.9 | ||||||||||
Accumulated deficit | (353.0 | ) | (413.1 | ) | (486.9 | ) | (449.2 | ) | (355.7 | ) | |||||
Accumulated other comprehensive income (loss) | (1.3 | ) | (1.3 | ) | 74.2 | (1.3 | ) | (1.2 | ) | ||||||
Total stockholders' equity | 1,928.2 | 1,854.6 | 1,713.9 | 1,376.4 | 1,465.9 | ||||||||||
Total liabilities and equity | $ | 4,628.7 | $ | 4,498.3 | $ | 4,312.1 | $ | 3,883.8 | $ | 3,816.6 |
Six Months Ended June 30, 2018 | Six Months Ended June 30, 2017 | Three Months Ended June 30, 2018 | Three Months Ended June 30, 2017 | |||||||||
Cash flows from operating activities: | ||||||||||||
Net income (loss) | $ | 149.4 | $ | (31.2 | ) | $ | 105.9 | $ | (0.8 | ) | ||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||
Depreciation and amortization | 152.2 | 119.4 | 77.6 | 63.7 | ||||||||
Interest expense amortization, net | 1.8 | 2.2 | 1.1 | 1.3 | ||||||||
Stock-based compensation expense | 8.4 | 7.7 | 4.5 | 4.0 | ||||||||
Provision for bad debt expense | 0.4 | 0.3 | (0.1 | ) | 0.3 | |||||||
Unrealized gain on marketable equity investment | (143.2 | ) | — | (102.7 | ) | — | ||||||
Loss on early extinguishment of debt | 3.1 | 36.5 | — | 0.3 | ||||||||
Asset impairments | — | 3.6 | — | 3.6 | ||||||||
Other | — | 0.2 | — | — | ||||||||
Change in operating assets and liabilities: | ||||||||||||
Rent and other receivables, net and other assets | (36.8 | ) | (41.3 | ) | (18.8 | ) | (21.3 | ) | ||||
Accounts payable and accrued expenses | (3.1 | ) | 5.2 | 25.8 | 12.0 | |||||||
Deferred revenue and prepaid rents | 16.3 | 18.9 | 11.0 | 3.2 | ||||||||
Net cash provided by operating activities | 148.5 | 121.5 | 104.3 | 66.3 | ||||||||
Cash flows from investing activities: | ||||||||||||
Asset acquisitions, primarily real estate, net of cash acquired | — | (492.3 | ) | — | — | |||||||
Investment in real estate | (322.7 | ) | (485.0 | ) | (177.5 | ) | (302.5 | ) | ||||
Net cash used in investing activities | (322.7 | ) | (977.3 | ) | (177.5 | ) | (302.5 | ) | ||||
Cash flows from financing activities: | ||||||||||||
Issuance of common stock, net | 152.2 | 408.6 | 9.3 | 197.6 | ||||||||
Dividends paid | (86.6 | ) | (69.1 | ) | (45.6 | ) | (36.7 | ) | ||||
Proceeds from debt, net | 985.4 | 1,766.0 | (0.2 | ) | 565.1 | |||||||
Payments on debt | (902.7 | ) | (1,212.1 | ) | — | (467.3 | ) | |||||
Payments on capital lease obligations and lease financing arrangements | (5.1 | ) | (4.8 | ) | (2.5 | ) | (2.5 | ) | ||||
Tax payment upon exercise of equity awards | (4.7 | ) | (6.6 | ) | (0.3 | ) | (0.2 | ) | ||||
Net cash provided by financing activities | 138.5 | 882.0 | (39.3 | ) | 256.0 | |||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (35.7 | ) | 26.2 | (112.5 | ) | 19.8 | ||||||
Cash, cash equivalents and restricted cash at beginning of period | 151.9 | 14.6 | 228.7 | 21.0 | ||||||||
Cash, cash equivalents and restricted cash at end of period | $ | 116.2 | $ | 40.8 | $ | 116.2 | $ | 40.8 | ||||
Supplemental disclosure of cash flow information: | ||||||||||||
Cash paid for interest, net of amounts capitalized of $10.4 million and $8.1 million in 2018 and 2017, respectively | $ | 53.3 | $ | 27.5 | $ | 11.1 | $ | 9.2 | ||||
Non-cash investing and financing activities: | ||||||||||||
Construction costs and other payables | 113.3 | 163.4 | 113.3 | 163.4 | ||||||||
Dividends payable | 46.5 | 39.4 | 46.5 | 39.4 | ||||||||
Real estate additions from entering into and modifying capital leases | 6.6 | — | — | — | ||||||||
Transfer of land held for future development to construction in progress | 9.3 | 6.6 | (0.1 | ) | 2.6 | |||||||
Transfer of construction in progress to gross operating real estate | 337.7 | 415.6 | 159.0 | 110.3 |
Six Months Ended | Three Months Ended | ||||||||||||||||||||||||
June 30, | Change | June 30, | March 31, | December 31, | September 30, | June 30, | |||||||||||||||||||
2018 | 2017 | $ | % | 2018 | 2018 | 2017 | 2017 | 2017 | |||||||||||||||||
Net Operating Income | |||||||||||||||||||||||||
Revenue | $ | 393.5 | $ | 316.2 | $ | 77.3 | 24% | $ | 196.9 | $ | 196.6 | $ | 180.5 | $ | 175.3 | $ | 166.9 | ||||||||
Property operating expenses | 136.7 | 111.9 | 24.8 | 22% | 68.9 | 67.8 | 60.2 | 63.0 | 59.6 | ||||||||||||||||
Net Operating Income (NOI) | $ | 256.8 | $ | 204.3 | $ | 52.5 | 26% | $ | 128.0 | $ | 128.8 | $ | 120.3 | $ | 112.3 | $ | 107.3 | ||||||||
NOI as a % of Revenue | 65.3 | % | 64.6 | % | 65.0 | % | 65.5 | % | 66.6 | % | 64.1 | % | 64.3 | % | |||||||||||
Reconciliation of Net Income (Loss) to Adjusted EBITDA: | |||||||||||||||||||||||||
Net income (loss) | $ | 149.4 | $ | (31.2 | ) | $ | 180.6 | n/m | $ | 105.9 | $ | 43.5 | $ | 2.8 | $ | (55.1 | ) | $ | (0.8 | ) | |||||
Interest expense | 43.6 | 30.1 | 13.5 | 45% | 22.8 | 20.8 | 20.1 | 17.9 | 16.5 | ||||||||||||||||
Income tax expense | 1.8 | 1.1 | 0.7 | 64% | 1.0 | 0.8 | 1.0 | 0.9 | 0.7 | ||||||||||||||||
Depreciation and amortization | 152.2 | 119.4 | 32.8 | 27% | 77.6 | 74.6 | 70.8 | 68.7 | 63.7 | ||||||||||||||||
Asset impairments and loss on disposals | — | 3.8 | (3.8 | ) | n/m | — | — | 0.2 | 55.5 | 3.6 | |||||||||||||||
EBITDA (NAREIT definition)(a) | $ | 347.0 | $ | 123.2 | 223.8 | n/m | $ | 207.3 | $ | 139.7 | $ | 94.9 | $ | 87.9 | $ | 83.7 | |||||||||
Transaction, acquisition, integration and other related expenses | 2.3 | 2.3 | — | n/m | 0.4 | 1.9 | 5.1 | 3.0 | 1.7 | ||||||||||||||||
Legal claim costs | 0.3 | 0.8 | (0.5 | ) | (63)% | 0.1 | 0.2 | — | 0.3 | 0.6 | |||||||||||||||
Stock-based compensation expense | 8.4 | 7.7 | 0.7 | 9% | 4.5 | 3.9 | 3.1 | 3.9 | 4.0 | ||||||||||||||||
Severance and management transition costs | 0.7 | 0.5 | 0.2 | 40% | — | 0.7 | — | — | — | ||||||||||||||||
Loss on early extinguishment of debt | 3.1 | 36.5 | (33.4 | ) | n/m | — | 3.1 | — | — | 0.3 | |||||||||||||||
New accounting standards and regulatory compliance and the related system implementation costs | 1.5 | 0.5 | 1.0 | n/m | 1.0 | 0.5 | 1.1 | 0.8 | 0.5 | ||||||||||||||||
Unrealized gain on marketable equity investment | (143.2 | ) | — | (143.2 | ) | n/m | (102.7 | ) | (40.5 | ) | — | — | — | ||||||||||||
Adjusted EBITDA | $ | 220.1 | $ | 171.5 | 48.6 | 28% | $ | 110.6 | $ | 109.5 | $ | 104.2 | $ | 95.9 | $ | 90.8 | |||||||||
Adjusted EBITDA as a % of Revenue | 55.9 | % | 54.2 | % | 56.2 | % | 55.7 | % | 57.7 | % | 54.7 | % | 54.4 | % |
(a) | We calculate Earnings Before Interest, Taxes, Depreciation and Amortization for Real Estate (EBITDAre) as GAAP net income (loss) plus interest expense, income tax expense, depreciation and amortization plus or minus losses and gains on the disposition of depreciable property, plus asset impairments. While it is consistent with the definition of EBITDAre promulgated by the National Association of Real Estate Investment Trusts ("NAREIT"), our computation of EBITDAre may differ from the methodology for calculating EBITDAre used by other REITs. Accordingly, our EBITDAre may not be comparable to others. |
Three Months Ended | Six Months Ended | |||||||||||||||||||||
June 30, | Change | June 30, | Change | |||||||||||||||||||
2018 | 2017 | $ | % | 2018 | 2017 | $ | % | |||||||||||||||
Net Income (Loss) | $ | 105.9 | $ | (0.8 | ) | $ | 106.7 | n/m | $ | 149.4 | $ | (31.2 | ) | $ | 180.6 | n/m | ||||||
Sales and marketing expenses | 4.4 | 4.3 | 0.1 | 2 | % | 9.7 | 9.2 | 0.5 | 5 | % | ||||||||||||
General and administrative expenses | 18.6 | 17.3 | 1.3 | 8 | % | 37.9 | 33.1 | 4.8 | 15 | % | ||||||||||||
Depreciation and amortization expenses | 77.6 | 63.7 | 13.9 | 22 | % | 152.2 | 119.4 | 32.8 | 27 | % | ||||||||||||
Transaction, acquisition, integration and other related expenses | 0.4 | 1.7 | (1.3 | ) | (76 | )% | 2.3 | 2.5 | (0.2 | ) | (8 | )% | ||||||||||
Asset impairments | — | 3.6 | (3.6 | ) | (100 | )% | — | 3.6 | (3.6 | ) | (100 | )% | ||||||||||
Interest expense | 22.8 | 16.5 | 6.3 | 38 | % | 43.6 | 30.1 | 13.5 | 45 | % | ||||||||||||
Unrealized gain on marketable equity investment | (102.7 | ) | — | (102.7 | ) | n/m | (143.2 | ) | — | (143.2 | ) | n/m | ||||||||||
Loss on early extinguishment of debt | — | 0.3 | (0.3 | ) | (100 | )% | 3.1 | 36.5 | (33.4 | ) | (92 | )% | ||||||||||
Income tax expense | 1.0 | 0.7 | 0.3 | 43 | % | 1.8 | 1.1 | 0.7 | 64 | % | ||||||||||||
Net Operating Income | $ | 128.0 | $ | 107.3 | $ | 20.7 | 19 | % | $ | 256.8 | $ | 204.3 | $ | 52.5 | 26 | % |
Six Months Ended | Three Months Ended | |||||||||||||||||||||||||
June 30, | Change | June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||||||
2018 | 2017 | $ | % | 2018 | 2018 | 2017 | 2017 | 2017 | ||||||||||||||||||
Reconciliation of Net Income (Loss) to FFO and Normalized FFO: | ||||||||||||||||||||||||||
Net income (loss) | $ | 149.4 | $ | (31.2 | ) | $ | 180.6 | n/m | $ | 105.9 | $ | 43.5 | $ | 2.8 | $ | (55.1 | ) | $ | (0.8 | ) | ||||||
Real estate depreciation and amortization | 136.5 | 104.0 | 32.5 | 31 | % | 69.8 | 66.7 | 62.6 | 60.3 | 55.3 | ||||||||||||||||
Asset impairments | — | 3.6 | (3.6 | ) | n/m | — | — | — | 54.4 | 3.6 | ||||||||||||||||
Funds from Operations ("FFO") - NAREIT defined | $ | 285.9 | $ | 76.4 | $ | 209.5 | n/m | $ | 175.7 | $ | 110.2 | $ | 65.4 | $ | 59.6 | $ | 58.1 | |||||||||
Loss on early extinguishment of debt | 3.1 | 36.5 | (33.4 | ) | n/m | — | 3.1 | — | — | 0.3 | ||||||||||||||||
Unrealized gain on marketable equity investment | (143.2 | ) | — | (143.2 | ) | n/m | (102.7 | ) | (40.5 | ) | — | — | — | |||||||||||||
New accounting standards and regulatory compliance and the related system implementation costs | 1.5 | 0.5 | 1.0 | n/m | 1.0 | 0.5 | 1.1 | 0.8 | 0.5 | |||||||||||||||||
Amortization of customer relationship intangibles | 12.3 | 11.9 | 0.4 | 3 | % | 6.2 | 6.1 | 6.6 | 6.6 | 6.7 | ||||||||||||||||
Transaction, acquisition, integration and other related expenses | 2.3 | 2.5 | (0.2 | ) | (8 | )% | 0.4 | 1.9 | 5.3 | 4.1 | 1.7 | |||||||||||||||
Severance and management transition costs | 0.7 | 0.5 | 0.2 | 40 | % | — | 0.7 | — | — | — | ||||||||||||||||
Legal claim costs | 0.3 | 0.8 | (0.5 | ) | (63 | )% | 0.1 | 0.2 | — | 0.3 | 0.6 | |||||||||||||||
Normalized Funds from Operations (Normalized FFO) | $ | 162.9 | $ | 129.1 | $ | 33.8 | 26 | % | $ | 80.7 | $ | 82.2 | $ | 78.4 | $ | 71.4 | $ | 67.9 | ||||||||
Normalized FFO per diluted common share | $ | 1.66 | $ | 1.49 | $ | 0.17 | 11 | % | $ | 0.81 | $ | 0.85 | $ | 0.84 | $ | 0.79 | $ | 0.77 | ||||||||
Weighted average diluted common shares outstanding | 98.1 | 86.5 | 11.6 | 13 | % | 99.4 | 96.6 | 93.5 | 90.9 | 88.5 | ||||||||||||||||
Additional Information: | ||||||||||||||||||||||||||
Amortization of deferred financing costs and bond premium | 1.8 | 2.2 | (0.4 | ) | (18 | )% | 1.1 | 0.7 | 0.9 | 1.2 | 1.2 | |||||||||||||||
Stock-based compensation expense | 8.4 | 7.7 | 0.7 | 9 | % | 4.5 | 3.9 | 3.1 | 3.9 | 4.0 | ||||||||||||||||
Non-real estate depreciation and amortization | 3.4 | 3.5 | (0.1 | ) | (3 | )% | 1.6 | 1.8 | 1.6 | 1.8 | 1.7 | |||||||||||||||
Straight line rent adjustments(a) | (13.0 | ) | (18.5 | ) | 5.5 | (30 | )% | (5.8 | ) | (7.2 | ) | (7.4 | ) | (6.4 | ) | (8.8 | ) | |||||||||
Deferred revenue, primarily installation revenue(b) | 5.6 | 6.4 | (0.8 | ) | (13 | )% | 2.4 | 3.2 | 3.8 | 12.9 | 6.1 | |||||||||||||||
Leasing commissions | (6.9 | ) | (7.7 | ) | 0.8 | (10 | )% | (3.7 | ) | (3.2 | ) | (3.5 | ) | (6.1 | ) | (3.8 | ) | |||||||||
Recurring capital expenditures | (4.7 | ) | (2.2 | ) | (2.5 | ) | n/m | (2.3 | ) | (2.4 | ) | (1.6 | ) | (0.6 | ) | (0.7 | ) |
(a) | Straight line rent adjustments: |
(b) | Deferred revenue, primarily installation revenue: |
(dollars in millions) | Shares or Equivalents Outstanding | Market Price as of June 30, 2018 | Market Value Equivalents (in millions) | |||||
Common shares | 99,114,112 | $ | 58.36 | $ | 5,784.3 | |||
Net Debt | 2,098.7 | |||||||
Total Enterprise Value (TEV) | $ | 7,883.0 |
June 30, | March 31, | |||||
(dollars in millions) | 2018 | 2018 | ||||
Long-term debt(a) | $ | 2,200.0 | $ | 2,200.0 | ||
Capital lease obligations | 14.9 | 15.9 | ||||
Less: | ||||||
Cash and cash equivalents | (116.2 | ) | (228.7 | ) | ||
Net Debt | $ | 2,098.7 | $ | 1,987.2 |
(dollars in millions) | ||||||
Long-term debt: | Amount | Interest Rate | Maturity Date | |||
Revolving credit facility | $ | — | L + 145bps | March 2023(a) | ||
Term loan | 700.0 | L + 140bps(b) | March 2023 | |||
Term loan | 300.0 | L + 170bps(c) | March 2025 | |||
5.000% senior notes due 2024, excluding bond premium | 700.0 | 5.000 | % | March 2024 | ||
5.375% senior notes due 2027, excluding bond premium | 500.0 | 5.375 | % | March 2027 | ||
Total long-term debt(d) | $ | 2,200.0 | 4.44 | % | ||
Weighted average term of debt: | 6.2 | years |
(a) | Assuming exercise of one-year extension option. |
(b) | Interest rate as of June 30, 2018: 3.50%. |
(c) | Interest rate as of June 30, 2018: 3.80%. |
(d) | Excludes adjustment for deferred financing costs. |
Interest Summary | Three Months Ended | ||||||||||
June 30, | March 31, | June 30, | Growth % | ||||||||
(dollars in millions) | 2018 | 2018 | 2017 | Yr/Yr | |||||||
Interest expense and fees | $ | 27.0 | $ | 25.2 | $ | 19.8 | 36 | % | |||
Amortization of deferred financing costs and bond premium | 1.1 | 0.7 | 1.2 | (8 | )% | ||||||
Capitalized interest | (5.3 | ) | (5.1 | ) | (4.5 | ) | 18 | % | |||
Total interest expense | $ | 22.8 | $ | 20.8 | $ | 16.5 | 38 | % |
As of June 30, 2018 | As of March 31, 2018 | As of June 30, 2017 | ||||||||||
Market | Colocation Space (CSF)(a) (000) | CSF Leased(b) | Colocation Space (CSF)(a) (000) | CSF Leased(b) | Colocation Space (CSF)(a) (000) | CSF Leased(b) | ||||||
Northern Virginia | 673 | 98 | % | 673 | 94 | % | 438 | 90 | % | |||
Dallas | 550 | 81 | % | 555 | 81 | % | 431 | 93 | % | |||
Phoenix | 509 | 92 | % | 509 | 91 | % | 216 | 100 | % | |||
Cincinnati | 402 | 93 | % | 404 | 92 | % | 404 | 92 | % | |||
Houston | 308 | 76 | % | 308 | 74 | % | 308 | 75 | % | |||
San Antonio | 300 | 100 | % | 273 | 100 | % | 240 | 100 | % | |||
New York Metro | 218 | 82 | % | 218 | 83 | % | 218 | 83 | % | |||
Chicago | 213 | 67 | % | 213 | 67 | % | 136 | 88 | % | |||
Austin | 106 | 72 | % | 106 | 73 | % | 106 | 64 | % | |||
Raleigh-Durham | 76 | 88 | % | 76 | 88 | % | 65 | 80 | % | |||
International | 13 | 76 | % | 13 | 76 | % | 13 | 77 | % | |||
Total | 3,369 | 88 | % | 3,348 | 86 | % | 2,575 | 89 | % | |||
Stabilized Properties(c) | 3,097 | 92 | % | 3,024 | 92 | % | 2,380 | 93 | % |
(a) | CSF represents the NRSF at an operating facility that is currently leased or readily available for lease as colocation space, where customers locate their servers and other IT equipment. |
(b) | CSF Leased is calculated by dividing CSF under signed leases for colocation space (whether or not the lease has commenced billing) by total CSF. |
(c) | Stabilized properties include data halls that have been in service for at least 24 months or are at least 85% leased. |
Category | Previous 2018 Guidance(1) | Revised 2018 Guidance(1) |
Total Revenue | $810 - 825 million | $820 - 830 million |
Lease and Other Revenues from Customers | $735 - 745 million | $725 - 730 million |
Metered Power Reimbursements | $75 - 80 million | $95 - 100 million |
Adjusted EBITDA | $460 - 470 million | $454 - 459 million |
Normalized FFO per diluted common share | $3.18 - 3.28 | $3.25 - 3.30 |
Capital Expenditures | $850 - 900 million | $850 - 900 million |
Development | $845 - 890 million | $845 - 890 million |
Recurring | $5 - 10 million | $5 - 10 million |
Operating Net Rentable Square Feet (NRSF)(a) | Powered Shell Available for Future Development (NRSF)(k) (000) | Available Critical Load Capacity (MW)(l) | ||||||||||||||||||||
Stabilized Properties(b) | Metro Area | Annualized Rent(c) ($000) | Colocation Space (CSF)(d) (000) | CSF Occupied(e) | CSF Leased(f) | Office & Other(g) (000) | Office & Other Occupied(h) | Supporting Infrastructure(i) (000) | Total(j) (000) | |||||||||||||
Dallas - Carrollton | Dallas | $ | 74,229 | 305 | 89 | % | 89 | % | 82 | 51 | % | 111 | 498 | — | 38 | |||||||
Houston - Houston West I | Houston | 42,902 | 112 | 97 | % | 97 | % | 11 | 99 | % | 37 | 161 | 3 | 28 | ||||||||
Dallas - Lewisville* | Dallas | 35,409 | 114 | 88 | % | 89 | % | 11 | 95 | % | 54 | 180 | — | 21 | ||||||||
Cincinnati - 7th Street*** | Cincinnati | 35,231 | 197 | 94 | % | 94 | % | 6 | 100 | % | 175 | 378 | 46 | 16 | ||||||||
Northern Virginia - Sterling II | Northern Virginia | 35,162 | 159 | 100 | % | 100 | % | 9 | 100 | % | 55 | 223 | — | 30 | ||||||||
San Antonio III | San Antonio | 31,477 | 132 | 100 | % | 100 | % | 9 | 100 | % | 43 | 184 | — | 24 | ||||||||
Somerset I | New York Metro | 28,616 | 97 | 85 | % | 85 | % | 27 | 89 | % | 89 | 213 | 203 | 11 | ||||||||
Chicago - Aurora I | Chicago | 27,628 | 113 | 97 | % | 97 | % | 34 | 100 | % | 223 | 371 | 27 | 71 | ||||||||
Totowa - Madison** | New York Metro | 26,800 | 51 | 89 | % | 90 | % | 22 | 100 | % | 59 | 133 | — | 6 | ||||||||
Cincinnati - North Cincinnati | Cincinnati | 24,450 | 65 | 98 | % | 99 | % | 45 | 79 | % | 53 | 163 | 65 | 14 | ||||||||
Houston - Houston West II | Houston | 24,317 | 80 | 87 | % | 87 | % | 4 | 88 | % | 55 | 139 | 11 | 12 | ||||||||
Wappingers Falls I** | New York Metro | 23,073 | 37 | 90 | % | 90 | % | 20 | 99 | % | 15 | 72 | — | 3 | ||||||||
Northern Virginia - Sterling V | Northern Virginia | 22,914 | 276 | 73 | % | 95 | % | 11 | 100 | % | 121 | 408 | 64 | 39 | ||||||||
San Antonio I | San Antonio | 22,871 | 44 | 100 | % | 100 | % | 6 | 83 | % | 46 | 96 | 11 | 12 | ||||||||
Phoenix - Chandler II | Phoenix | 22,608 | 74 | 100 | % | 100 | % | 6 | 38 | % | 26 | 105 | — | 12 | ||||||||
Phoenix - Chandler I | Phoenix | 19,999 | 74 | 100 | % | 100 | % | 35 | 12 | % | 39 | 147 | 31 | 16 | ||||||||
Northern Virginia - Sterling I | Northern Virginia | 19,053 | 78 | 100 | % | 100 | % | 6 | 77 | % | 49 | 132 | — | 12 | ||||||||
Phoenix - Chandler III | Phoenix | 18,806 | 68 | 100 | % | 100 | % | 2 | — | % | 30 | 101 | — | 14 | ||||||||
Raleigh-Durham I | Raleigh-Durham | 17,651 | 76 | 88 | % | 88 | % | 13 | 100 | % | 82 | 171 | 246 | 12 | ||||||||
Houston - Galleria | Houston | 16,665 | 63 | 59 | % | 60 | % | 23 | 51 | % | 25 | 112 | — | 14 | ||||||||
Northern Virginia - Sterling III | Northern Virginia | 16,147 | 79 | 100 | % | 100 | % | 7 | 100 | % | 34 | 120 | — | 15 | ||||||||
Austin II | Austin | 15,715 | 44 | 95 | % | 95 | % | 2 | 100 | % | 22 | 68 | — | 5 | ||||||||
San Antonio II | San Antonio | 14,754 | 64 | 100 | % | 100 | % | 11 | 100 | % | 41 | 117 | — | 12 | ||||||||
Phoenix - Chandler VI | Phoenix | 14,452 | 148 | 96 | % | 98 | % | 6 | 100 | % | 32 | 186 | 10 | 24 | ||||||||
Florence | Cincinnati | 13,509 | 53 | 99 | % | 99 | % | 47 | 87 | % | 40 | 140 | — | 9 | ||||||||
Austin III | Austin | 12,331 | 62 | 54 | % | 56 | % | 15 | 83 | % | 21 | 98 | 67 | 6 | ||||||||
Phoenix - Chandler IV | Phoenix | 11,387 | 73 | 100 | % | 100 | % | 3 | 100 | % | 27 | 103 | — | 12 | ||||||||
Cincinnati - Hamilton* | Cincinnati | 10,652 | 47 | 76 | % | 76 | % | 1 | 100 | % | 35 | 83 | — | 10 | ||||||||
Northern Virginia - Sterling IV | Northern Virginia | 8,711 | 81 | 100 | % | 100 | % | 7 | 100 | % | 34 | 122 | — | 15 | ||||||||
London - Great Bridgewater** | International | 6,300 | 10 | 94 | % | 94 | % | — | — | % | 1 | 11 | — | 1 | ||||||||
Dallas - Midway** | Dallas | 5,357 | 8 | 100 | % | 100 | % | — | — | % | — | 8 | — | 1 | ||||||||
San Antonio IV | San Antonio | 5,285 | 60 | 45 | % | 100 | % | 4 | — | % | 27 | 91 | — | 12 | ||||||||
Cincinnati - Mason | Cincinnati | 5,269 | 34 | 100 | % | 100 | % | 26 | 98 | % | 17 | 78 | — | 4 | ||||||||
Stamford - Riverbend** | New York Metro | 5,250 | 20 | 23 | % | 23 | % | — | — | % | 8 | 28 | — | 2 | ||||||||
Houston - Houston West III | Houston | 4,641 | 53 | 25 | % | 34 | % | 10 | 100 | % | 32 | 95 | 209 | 6 | ||||||||
Norwalk I** | New York Metro | 3,942 | 13 | 96 | % | 96 | % | 4 | 68 | % | 41 | 58 | 87 | 2 | ||||||||
Chicago - Lombard | Chicago | 2,383 | 14 | 73 | % | 74 | % | 4 | 100 | % | 12 | 30 | 29 | 3 | ||||||||
Stamford - Omega** | New York Metro | 1,238 | — | — | % | — | % | 19 | 84 | % | 4 | 22 | — | — | ||||||||
Cincinnati - Blue Ash* | Cincinnati | 660 | 6 | 36 | % | 36 | % | 7 | 100 | % | 2 | 15 | — | 1 | ||||||||
Totowa - Commerce** | New York Metro | 567 | — | — | % | — | % | 20 | 38 | % | 6 | 26 | — | — | ||||||||
South Bend - Crescent* | Chicago | 542 | 3 | 41 | % | 41 | % | — | — | % | 5 | 9 | 11 | 1 | ||||||||
Singapore - Inter Business Park** | International | 383 | 3 | 22 | % | 22 | % | — | — | % | — | 3 | — | 1 | ||||||||
South Bend - Monroe | Chicago | 123 | 6 | 23 | % | 23 | % | — | — | % | 6 | 13 | 4 | 1 | ||||||||
Stabilized Properties - Total | $ | 729,461 | 3,097 | 88 | % | 92 | % | 576 | 77 | % | 1,835 | 5,508 | 1,124 | 543 | ||||||||
CyrusOne Inc. | ||||||||||||||||||||||
Data Center Portfolio | ||||||||||||||||||||||
As of June 30, 2018 | ||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
Operating Net Rentable Square Feet (NRSF)(a) | Powered Shell Available for Future Development (NRSF)(k) (000) | Available Critical Load Capacity (MW)(l) | ||||||||||||||||||||
Metro Area | Annualized Rent(c) ($000) | Colocation Space (CSF)(d) (000) | CSF Occupied(e) | CSF Leased(f) | Office & Other(g) (000) | Office & Other Occupied(h) | Supporting Infrastructure(i) (000) | Total(j) (000) | ||||||||||||||
Stabilized Properties - Total | $ | 729,461 | 3,097 | 88 | % | 92 | % | 576 | 77 | % | 1,835 | 5,508 | 1,124 | 543 | ||||||||
Pre-Stabilized Properties(b) | ||||||||||||||||||||||
Dallas - Carrollton (DH #6) | Dallas | 4,906 | 75 | 76 | % | 76 | % | — | — | % | 21 | 96 | — | 6 | ||||||||
Phoenix - Chandler V | Phoenix | 3,816 | 72 | 50 | % | 50 | % | 1 | 50 | % | 16 | 89 | 94 | 12 | ||||||||
Chicago - Aurora II (DH #1) | Chicago | 1,077 | 77 | 23 | % | 28 | % | 10 | — | % | 14 | 101 | 272 | 16 | ||||||||
Dallas - Carrollton (DH #7) | Dallas | 550 | 48 | 18 | % | 21 | % | — | — | % | — | 48 | — | 6 | ||||||||
All Properties - Total | $ | 739,809 | 3,369 | 85 | % | 88 | % | 587 | 75 | % | 1,886 | 5,842 | 1,490 | 583 |
* | Indicates properties in which we hold a leasehold interest in the building shell and land. All data center infrastructure has been constructed by us and is owned by us. |
** | Indicates properties in which we hold a leasehold interest in the building shell, land, and all data center infrastructure. |
(a) | Represents the total square feet of a building under lease or available for lease based on engineers' drawings and estimates but does not include space held for development or space used by CyrusOne. |
(b) | Stabilized properties include data halls that have been in service for at least 24 months or are at least 85% leased. Pre-stabilized properties include data halls that have been in service for less than 24 months and are less than 85% leased. |
(c) | Represents monthly contractual rent (defined as cash rent including customer reimbursements for metered power) under existing customer leases as of June 30, 2018, multiplied by 12. For the month of June 2018, customer reimbursements were $100.8 million annualized and consisted of reimbursements by customers across all facilities with separately metered power. Customer reimbursements under leases with separately metered power vary from month-to-month based on factors such as our customers' utilization of power and the suppliers' pricing of power. From July 1, 2016 through June 30, 2018, customer reimbursements under leases with separately metered power constituted between 10.2% and 13.6% of annualized rent. After giving effect to abatements, free rent and other straight-line adjustments, our annualized effective rent as of June 30, 2018 was $746.4 million. Our annualized effective rent was greater than our annualized rent as of June 30, 2018 because our positive straight-line and other adjustments and amortization of deferred revenue exceeded our negative straight-line adjustments due to factors such as the timing of contractual rent escalations and customer prepayments for services. |
(d) | CSF represents the NRSF at an operating facility that is currently leased or readily available for lease as colocation space, where customers locate their servers and other IT equipment. |
(e) | Percent occupied is determined based on CSF billed to customers under signed leases as of June 30, 2018 divided by total CSF. Leases signed but that have not commenced billing as of June 30, 2018 are not included. |
(f) | Percent leased is calculated by dividing CSF under signed leases for colocation space (whether or not the lease has commenced billing) by total CSF. |
(g) | Represents the NRSF at an operating facility that is currently leased or readily available for lease as space other than CSF, which is typically office and other space. |
(h) | Percent occupied is determined based on Office & Other space being billed to customers under signed leases as of June 30, 2018 divided by total Office & Other space. Leases signed but not commenced as of June 30, 2018 are not included. |
(i) | Represents infrastructure support space, including mechanical, telecommunications and utility rooms, as well as building common areas. |
(j) | Represents the NRSF at an operating facility that is currently leased or readily available for lease. This excludes existing vacant space held for development. |
(k) | Represents space that is under roof that could be developed in the future for operating NRSF, rounded to the nearest 1,000. |
(l) | Critical load capacity represents the aggregate power available for lease and exclusive use by customers expressed in terms of megawatts. The capacity reported is for non-redundant megawatts, as we can develop flexible solutions to our customers at multiple resiliency levels. Does not sum to total due to rounding. |
NRSF Under Development(a) | Under Development Costs | ||||||||||||||||||
Facilities | Metropolitan Area | Estimated Completion Date | Colocation Space (CSF) (000) | Office & Other (000) | Supporting Infrastructure (000) | Powered Shell(b) (000) | Total (000) | Critical Load MW Capacity(c) | Actual to Date(d) | Estimated Costs to Completion(e) | Total | ||||||||
Northern Virginia - Sterling V | Northern Virginia | 3Q'18 | 107 | — | 24 | — | 131 | 24.0 | $ | 18 | $84-96 | $102-114 | |||||||
Dallas - Carrollton | Dallas | 3Q'18 | — | — | — | — | — | 6.0 | 3 | 14-16 | 17-19 | ||||||||
Dallas - Allen | Dallas | 3Q'18 | 79 | 27 | 60 | 175 | 341 | 6.0 | 45 | 17-23 | 62-68 | ||||||||
Aurora II | Chicago | 3Q'18 | — | 35 | — | — | 35 | — | — | 8-9 | 8-9 | ||||||||
Somerset II | New York Metro | 4Q'18 | 9 | — | — | — | 9 | 2.0 | — | 12-14 | 12-14 | ||||||||
San Antonio IV | San Antonio | 4Q'18 | — | 8 | — | — | 8 | — | — | 1-2 | 1-2 | ||||||||
Northern Virginia - Sterling VI | Northern Virginia | 1Q'19 | 206 | 30 | 52 | 71 | 359 | 48.0 | 9 | 238-264 | 247-273 | ||||||||
Phoenix - Chandler VII | Phoenix | 1Q'19 | — | — | — | 269 | 269 | — | — | 59-65 | 59-65 | ||||||||
Northern Virginia - Sterling VII | Northern Virginia | 3Q'19 | — | — | — | 93 | 93 | — | — | 33-37 | 33-37 | ||||||||
Total | 401 | 100 | 136 | 609 | 1,246 | 86.0 | $ | 75 | $466-526 | $541-601 |
(a) | Represents NRSF at a facility for which activities have commenced or are expected to commence in the next 2 quarters to prepare the space for its intended use. Estimates and timing are subject to change. |
(b) | Represents NRSF under construction that, upon completion, will be powered shell available for future development into operating NRSF. |
(c) | Critical load capacity represents the aggregate power available for lease and exclusive use by customers expressed in terms of megawatts. The capacity reported is for non-redundant megawatts, as we can develop flexible solutions to our customers at multiple resiliency levels. |
(d) | Actual to date is the cash investment as of June 30, 2018. There may be accruals above this amount for work completed, for which cash has not yet been paid. |
(e) | Represents management’s estimate of the total costs required to complete the current NRSF under development. There may be an increase in costs if customers require greater power density. |
As of | ||
Market | June 30, 2018 | |
Atlanta | 44 | |
Austin | 22 | |
Chicago | 23 | |
Cincinnati | 98 | |
Dallas | 33 | |
Houston | 20 | |
International | — | |
New York Metro | — | |
Northern Virginia | — | |
Phoenix(a) | 95 | |
Quincy, Washington | 48 | |
Raleigh-Durham | — | |
San Antonio | — | |
Total Available(a) | 383 | |
Book Value of Total Available(a) | $70 million |
(a) | Adjusted to reflect impact of Phoenix - Chandler VII shell construction, which commenced in July 2018. |
Period | Number of Leases(a) | Total CSF Signed(b) | Total kW Signed(c) | Total MRR Signed (000)(d) | Weighted Average Lease Term(e) |
2Q'18 | 506 | 305,000 | 51,919 | $5,453 | 143 |
Prior 4Q Avg. | 424 | 149,750 | 17,367 | $2,382 | 73 |
1Q'18 | 439 | 226,000 | 29,364 | $3,370 | 77 |
4Q'17 | 395 | 86,000 | 8,600 | $1,463 | 61 |
3Q'17 | 411 | 151,000 | 14,830 | $2,228 | 68 |
2Q'17 | 451 | 136,000 | 16,673 | $2,467 | 86 |
(a) | Number of leases represents each agreement with a customer. A lease agreement could include multiple spaces, and a customer could have multiple leases. |
(b) | CSF represents the NRSF at an operating facility that is leased as colocation space, where customers locate their servers and other IT equipment. |
(c) | Represents maximum contracted kW that customers may draw during lease period. Additionally, we can develop flexible solutions for our customers at multiple resiliency levels, and the kW signed is unadjusted for this factor. |
(d) | Monthly recurring rent is defined as the average monthly contractual rent during the term of the lease. It includes the monthly impact of installation charges of approximately $0.3 million in 2Q'18 and $0.2 million in each of the other quarters. |
(e) | Calculated on a CSF-weighted basis. |
(a) | Monthly recurring rent is defined as the average monthly contractual rent during the term of the lease. It includes the monthly impact of installation charges of approximately $0.3 million in 2Q'18, $0.2 million in 2Q'17-1Q'18 and $0.1 million in each of the other quarters. |
Principal Customer Industry | Number of Locations | Annualized Rent(b) (000) | Percentage of Portfolio Annualized Rent(c) | Weighted Average Remaining Lease Term in Months(d) | |||||
1 | Information Technology | 10 | $ | 139,078 | 18.8 | % | 89.4 | ||
2 | Information Technology | 4 | 39,827 | 5.4 | % | 78.4 | |||
3 | Information Technology | 10 | 36,756 | 5.0 | % | 42.9 | |||
4 | Financial Services | 1 | 19,349 | 2.6 | % | 153.0 | |||
5 | Research and Consulting Services | 3 | 15,977 | 2.2 | % | 30.4 | |||
6 | Telecommunication Services | 2 | 15,674 | 2.1 | % | 3.9 | |||
7 | Healthcare | 2 | 14,999 | 2.0 | % | 114.0 | |||
8 | Energy | 5 | 13,629 | 1.8 | % | 3.3 | |||
9 | Energy | 1 | 13,060 | 1.8 | % | 23.6 | |||
10 | Industrials | 4 | 11,366 | 1.5 | % | 14.0 | |||
11 | Information Technology | 3 | 9,995 | 1.4 | % | 46.9 | |||
12 | Telecommunication Services | 7 | 9,796 | 1.3 | % | 27.2 | |||
13 | Information Technology | 4 | 9,336 | 1.3 | % | 49.1 | |||
14 | Financial Services | 2 | 9,194 | 1.2 | % | 62.6 | |||
15 | Consumer Staples | 3 | 8,639 | 1.2 | % | 31.5 | |||
16 | Information Technology | 2 | 7,926 | 1.1 | % | 70.9 | |||
17 | Information Technology | 3 | 7,884 | 1.0 | % | 115.8 | |||
18 | Energy | 2 | 6,789 | 0.9 | % | 28.3 | |||
19 | Financial Services | 1 | 6,600 | 0.9 | % | 23.0 | |||
20 | Telecommunication Services | 10 | 6,467 | 0.9 | % | 12.9 | |||
$ | 402,343 | 54.4 | % | 66.6 |
(a) | Customers and their affiliates are consolidated. |
(b) | Represents monthly contractual rent (defined as cash rent including customer reimbursements for metered power) under existing customer leases as of June 30, 2018, multiplied by 12. For the month of June 2018, customer reimbursements were $100.8 million annualized and consisted of reimbursements by customers across all facilities with separately metered power. Customer reimbursements under leases with separately metered power vary from month-to-month based on factors such as our customers' utilization of power and the suppliers' pricing of power. From July 1, 2016 through June 30, 2018, customer reimbursements under leases with separately metered power constituted between 10.2% and 13.6% of annualized rent. After giving effect to abatements, free rent and other straight-line adjustments, our annualized effective rent as of June 30, 2018 was $746.4 million. Our annualized effective rent was greater than our annualized rent as of June 30, 2018 because our positive straight-line and other adjustments and amortization of deferred revenue exceeded our negative straight-line adjustments due to factors such as the timing of contractual rent escalations and customer prepayments for services. |
(c) | Represents the customer’s total annualized rent divided by the total annualized rent in the portfolio as of June 30, 2018, which was approximately $739.8 million. |
(d) | Weighted average based on customer’s percentage of total annualized rent expiring and is as of June 30, 2018, assuming that customers exercise no renewal options and exercise all early termination rights that require payment of less than 50% of the remaining rents. Early termination rights that require payment of 50% or more of the remaining lease payments are not assumed to be exercised because such payments approximate the profitability margin of leasing that space to the customer, such that we do not consider early termination to be economically detrimental to us. |
NRSF Under Lease(a) | Number of Customers(b) | Percentage of All Customers | Total Leased NRSF(c) (000) | Percentage of Portfolio Leased NRSF | Annualized Rent(d) (000) | Percentage of Annualized Rent | |||||||
0-999 | 679 | 69 | % | 147 | 3 | % | $ | 71,038 | 10 | % | |||
1,000-2,499 | 118 | 12 | % | 186 | 4 | % | 41,495 | 6 | % | ||||
2,500-4,999 | 71 | 7 | % | 253 | 5 | % | 44,939 | 6 | % | ||||
5,000-9,999 | 46 | 5 | % | 325 | 7 | % | 63,788 | 9 | % | ||||
10,000+ | 75 | 7 | % | 4,005 | 81 | % | 518,549 | 69 | % | ||||
Total | 989 | 100 | % | 4,917 | 100 | % | $ | 739,809 | 100 | % |
(a) | Represents all leases in our portfolio, including colocation, office and other leases. |
(b) | Represents the number of customers occupying data center, office and other space as of June 30, 2018. This may vary from total customer count as some customers may be under contract, but have yet to occupy space. |
(c) | Represents the total square feet at a facility under lease and that has commenced billing, excluding space held for development or space used by CyrusOne. A customer’s leased NRSF is estimated based on such customer’s direct CSF or office and light-industrial space plus management’s estimate of infrastructure support space, including mechanical, telecommunications and utility rooms, as well as building common areas. |
(d) | Represents monthly contractual rent (defined as cash rent including customer reimbursements for metered power) under existing customer leases as of June 30, 2018, multiplied by 12. For the month of June 2018, customer reimbursements were $100.8 million annualized and consisted of reimbursements by customers across all facilities with separately metered power. Customer reimbursements under leases with separately metered power vary from month-to-month based on factors such as our customers' utilization of power and the suppliers' pricing of power. From July 1, 2016 through June 30, 2018, customer reimbursements under leases with separately metered power constituted between 10.2% and 13.6% of annualized rent. After giving effect to abatements, free rent and other straight-line adjustments, our annualized effective rent as of June 30, 2018 was $746.4 million. Our annualized effective rent was greater than our annualized rent as of June 30, 2018 because our positive straight-line and other adjustments and amortization of deferred revenue exceeded our negative straight-line adjustments due to factors such as the timing of contractual rent escalations and customer prepayments for services. |
Year(a) | Number of Leases Expiring(b) | Total Operating NRSF Expiring (000) | Percentage of Total NRSF | Annualized Rent(c) (000) | Percentage of Annualized Rent | Annualized Rent at Expiration(d) (000) | Percentage of Annualized Rent at Expiration | |||||||||
Available | 925 | 16 | % | |||||||||||||
Month-to-Month | 673 | 134 | 2 | % | $ | 38,282 | 5 | % | $ | 40,982 | 5 | % | ||||
2018 | 981 | 249 | 4 | % | 60,099 | 8 | % | 60,294 | 7 | % | ||||||
2019 | 1,982 | 551 | 10 | % | 104,868 | 14 | % | 106,308 | 13 | % | ||||||
2020 | 1,385 | 523 | 9 | % | 77,030 | 11 | % | 79,537 | 10 | % | ||||||
2021 | 1,295 | 603 | 10 | % | 105,776 | 14 | % | 111,138 | 14 | % | ||||||
2022 | 263 | 522 | 9 | % | 59,869 | 8 | % | 69,291 | 9 | % | ||||||
2023 | 169 | 415 | 7 | % | 40,742 | 6 | % | 61,701 | 8 | % | ||||||
2024 | 43 | 241 | 4 | % | 35,563 | 5 | % | 44,438 | 5 | % | ||||||
2025 | 42 | 181 | 3 | % | 29,549 | 4 | % | 34,132 | 4 | % | ||||||
2026 | 27 | 577 | 10 | % | 82,958 | 11 | % | 89,484 | 11 | % | ||||||
2027 | 16 | 417 | 7 | % | 58,517 | 8 | % | 68,117 | 8 | % | ||||||
2028 - Thereafter | 24 | 503 | 9 | % | 46,555 | 6 | % | 52,788 | 6 | % | ||||||
Total | 6,900 | 5,842 | 100 | % | $ | 739,809 | 100 | % | $ | 818,209 | 100 | % |
(a) | Leases that were auto-renewed prior to June 30, 2018 are shown in the calendar year in which their current auto-renewed term expires. Unless otherwise stated in the footnotes, the information set forth in the table assumes that customers exercise no renewal options and exercise all early termination rights that require payment of less than 50% of the remaining rents. Early termination rights that require payment of 50% or more of the remaining lease payments are not assumed to be exercised. |
(b) | Number of leases represents each agreement with a customer. A lease agreement could include multiple spaces and a customer could have multiple leases. |
(c) | Represents monthly contractual rent (defined as cash rent including customer reimbursements for metered power) under existing customer leases as of June 30, 2018, multiplied by 12. For the month of June 2018, customer reimbursements were $100.8 million annualized and consisted of reimbursements by customers across all facilities with separately metered power. Customer reimbursements under leases with separately metered power vary from month-to-month based on factors such as our customers' utilization of power and the suppliers' pricing of power. From July 1, 2016 through June 30, 2018, customer reimbursements under leases with separately metered power constituted between 10.2% and 13.6% of annualized rent. After giving effect to abatements, free rent and other straight-line adjustments, our annualized effective rent as of June 30, 2018 was $746.4 million. Our annualized effective rent was greater than our annualized rent as of June 30, 2018 because our positive straight-line and other adjustments and amortization of deferred revenue exceeded our negative straight-line adjustments due to factors such as the timing of contractual rent escalations and customer prepayments for services. |
(d) | Represents the final monthly contractual rent under existing customer leases that had commenced as of June 30, 2018, multiplied by 12. |
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