DuPont Fabros Technology, Inc. Reports Third Quarter 2015 Results

FREE Breaking News Alerts from StreetInsider.com!

E-mail Address

StreetInsider.com Top Tickers, 8/15/2026

1. AMAT
2. GLOB
3. SPY
4. RDDT
5. HTFL
6. SNDK
7. WDAY
8. ADYEN:NA
9. ADYYF
10. DVLT

ACC7 Phase I and CH2 Phase I 100% leased and commenced Midpoint of Normalized FFO guidance increases $0.03 per share and AFFO increases $0.04 per share

October 29, 2015 7:01 AM EDT

WASHINGTON, Oct. 29, 2015 /PRNewswire/ -- DuPont Fabros Technology, Inc. (NYSE: DFT) is reporting results for the quarter ended September 30, 2015.  All per share results are reported on a fully diluted basis.

Highlights

  • As of October 29, 2015, our operating portfolio was 97% leased and 93% commenced as measured by computer room square feet ("CRSF") and 95% leased and 91% commenced as measured by critical load (in megawatts, or "MW").
  • Quarterly Highlights:
    • Placed CH2 Phase I into service totaling 7.40 MW and 45,000 CRSF, now 100% leased.
    • Commenced two leases totaling 2.56 MW and 14,386 CRSF.
    • Increased capacity under the line of credit from $560 million to $700 million.
  • Subsequent to the third quarter 2015:
    • Leased 26.53 MW and 162,496 CRSF consisting of:
      • The entire 10.40 MW and 53,397 CRSF of our ACC2 facility.
      • The space formerly occupied by our bankrupt customer.  This is comprised of four leases totaling 4.13 MW and 38,852 CRSF. 
      • Three additional leases totaling 12.00 MW and 70,247 CRSF, resulting in ACC7 Phase I and CH2 Phase I being 100% leased and commenced.
  • Extended one lease totaling 1.49 MW and 8,461 CRSF.

Christopher Eldredge, President and Chief Executive Officer, said, "Evidence of customer demand for DFT's data centers is strong. Our leasing activity is on track for the best year in the company's history. We have fully leased the first phases of our new developments in Ashburn, VA and Chicago at a 13% GAAP return-on-investment, exceeding our target yield by 100 basis points. We re-leased 10.4 MW of space in ACC2 within 30 days of its vacancy. This momentum, coupled with our full sales pipeline, gives us confidence in the prospects for the 39 MW of new data center capacity we have under development."

Third Quarter 2015 Results

For the quarter ended September 30, 2015, earnings were $0.29 per share, equal to earnings per share in the third quarter of 2014. Revenues increased 9%, or $9.8 million, to $115.3 million for the third quarter of 2015 over the third quarter of 2014.  The increase in revenues was primarily due to new leases commencing, partially offset by the impact of our customer in bankruptcy.

Normalized FFO for the quarter ended September 30, 2015 was $0.62 per share compared to $0.60 per share for the third quarter of 2014.  Normalized FFO per share adds back the $0.01 per share recognized in the third quarter of 2015 for severance and equity accelerations and the $0.02 per share of loss on early extinguishment of debt in the third quarter of 2014.  Normalized FFO increased $0.02 per share, or 3%, from the prior year quarter primarily due to the following:

  • Increased operating income excluding depreciation of $0.08 per share which excludes the negative impact from the bankrupt customer, partially offset by
  • Revenue of $0.03 per share not recognized from the bankrupt customer and
  • Increased interest expense of $0.03 per share due to a higher level of outstanding debt related to development financing.

Adjusted FFO ("AFFO") for the quarter ended September 30, 2015 was $0.68 per share compared to $0.64 per share in the third quarter of 2014.  AFFO increased $0.04 per share, or 6% from the prior year.  The increase was primarily due to the following:

  • Increased Normalized FFO of $0.02 per share and
  • Increased add-back of straight-line revenue as a result of $0.02 per share of rent received from the bankrupt customer being applied to their straight-line receivable balance.

On October 20, 2015, Anexio Data Centers ("Anexio") purchased Net Data Centers' ("Net") east coast business for $4.5 million in cash and other consideration. The operations of this business are located in four of our data center facilities: ACC4 and ACC5 in Ashburn, Virginia; VA3 in Reston, Virginia and NJ1 in Piscataway, New Jersey.  In connection with this purchase, Anexio has entered into new leases with us at each of these locations.

On February 23, 2015, Net filed a voluntary petition for relief under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Central District of California, Los Angeles Division (the "Court"), Case No. 2:15-bk-12690-BB. At that time, Net leased and occupied space at our ACC4, ACC5, VA3 and NJ1 data center facilities. Specifically, Net leased 6.26 MW and 38,852 CRSF in the aggregate from us. The Net leases were rejected as of June 30, 2015, with Net remaining in possession pursuant to a revenue sharing arrangement with us.  As of October 29, 2015, Net has paid us $3.6 million under this revenue sharing agreement.  This agreement was terminated upon the sale of Net's east coast business.

Anexio has leased 4.13 MW and 38,852 CRSF in the aggregate from us, which results in our having an additional 2.13 MW available for lease, which is comprised of 0.93 MW in ACC4, 0.07 MW in ACC5 and 1.13 MW in NJ1.  The term of each lease commenced on October 20, 2015 and runs through December 31, 2023.  The rent of the new leases compared to the rejected Net leases results in a 33.9% reduction in cash base rent and an 18.1% reduction in GAAP base rent.

We also have a $6.5 million note receivable from Net, of which $5.1 million is reserved and represents 79% of the outstanding note balance. We will continue to monitor this reserve each quarter.

First Nine Months 2015 Results

For the nine months ended September 30, 2015, earnings were $0.82 per share compared to $0.91 per share for the first nine months of 2014.  The first nine months of 2015 were negatively impacted by the customer who filed for bankruptcy, resulting in $0.10 per share of revenue not being recognized and $0.03 of non-cash write-offs when this customer rejected its leases.  Also, we recognized charges of $0.08 per share for severance expense and equity accelerations. Excluding these items, earnings per share for the nine months ended September 30, 2015 increased $0.12 per share, or 13%.  Revenues increased 9%, or $26.9 million, to $336.5 million for the first nine months of 2015 compared to the first nine months of 2014.  The increase in revenues was primarily due to new leases commencing, an increase in a la carte revenue and an increase in recoveries from tenants due to higher real estate taxes, partially offset by impact of the customer in bankruptcy noted above.

Normalized FFO for the nine months ended September 30, 2015 was $1.85 per share compared to $1.80 per share for the first nine months of 2014.  Normalized FFO adds back the $0.08 per share recognized in the first nine months of 2015 for the severance expense and equity accelerations noted above and the $0.02 per share loss on early extinguishment debt for the first nine months of 2014.  Normalized FFO increased $0.05 per share, or 3%, from the prior year period primarily due to the following:

  • Increased operating income excluding depreciation of $0.22 per share which excludes the negative impact from the bankrupt customer, partially offset by
  • Revenue of $0.10 per share not recognized from bankrupt customer,
  • Write-off of $0.02 per share of straight-line receivables and intangible assets related to the bankrupt customer, and
  • Increased interest expense of $0.05 per share due to a higher level of outstanding debt related to development financing.  

AFFO for the nine months ended September 30, 2015 was $2.03 per share compared to $1.88 per share in the first nine months of 2014.  AFFO increased $0.15 per share, or 8% from the prior year.  The increase was primarily due to the following:

  • Increased Normalized FFO of $0.05 per share,
  • Increased add-back of straight-line revenue as a result of rent received from bankrupt customer not recognized as revenue and increased cash rents totaling $0.09 per share,
  • Add-back of non-cash write-offs of straight-line receivables and intangible assets of $0.02 per share, partially offset by
  • Lower stock compensation expense add-back of $0.01 per share.   

Portfolio Update

During the third quarter 2015, we:

  • Commenced two leases totaling 2.56 MW and 14,386 CRSF. One of these leases was at CH2 Phase I for 1.42 MW and 8,886 CRSF and the other was at ACC5 for 1.14 MW and 5,500 CRSF.
  • Extended one lease at ACC5 totaling 0.57 MW and 2,700 CRSF. This lease was scheduled to expire in 2016 and was extended by 5.0 years to now expire in 2021. Compared to the rate in effect at the time of renewal, cash base rent will be 3.0% higher upon the expiration of the original lease term.  GAAP base rent will be 24.2% higher immediately.

Subsequent to the third quarter, we:

  • Signed eight leases with a weighted average lease term of 6.1 years totaling 26.53 MW and 162,496 CRSF.
    • Two of these leases were with one customer at ACC7 totaling 6.00 MW and 34,409 CRSF.  One of the leases was in Phase I (3.00 MW) which commenced in October 2015 and one pre-lease is in Phase II (3.00 MW) which is projected to commence in the fourth quarter of 2015 upon the opening of Phase II.  ACC7 Phase I is now 100% leased with these leases and ACC7 Phase II is 67% pre-leased.
    • One lease was at CH2 Phase I totaling 6.00 MW and 35,838 CRSF.  This lease commenced in October 2015.  CH2 Phase I is now 100% leased with this lease.
    • One lease was for the entire 10.4 MW and 53,397 CRSF at ACC2, the space recently vacated by Yahoo!.  This lease is expected to commence in the first quarter of 2016.  Compared to the lease rates in effect at the expiration of Yahoo's! lease, cash base rents for the new lease will be 41.4% lower and GAAP base rents will be 12.6% lower.  Total rents including operating expense recovery will be 31.4% lower for cash and 9.6% lower for GAAP.  We believe that this magnitude of decline is specific to the ACC2 data center facility and will not be applicable to the remaining portfolio.  ACC2 is the Company's smallest data center facility and, primarily for that reason, has the highest cost of operations and cooling.  Although base rent had to be decreased to make ACC2 market-competitive, on a total cost of occupancy basis - the total of base rent, operating costs and cooling -  ACC2's new customer will pay as much at ACC2 as a super wholesale customer would pay at ACC7.
    • Four leases were with the purchaser of Net Data Centers, Anexio, at ACC4, ACC5, NJ1 and VA3, totaling 4.13 MW and 38,852 CRSF in the aggregate, as described above.
  • Extended one lease at ACC7 Phase I totaling 1.49 MW and 8,461 CRSF. This lease was scheduled to expire in 2017 and was extended 4.2 years to now expire in 2021. Compared to the rate in effect at the time of renewal, cash base rent will be 10.0% lower upon the expiration of the original lease term.  GAAP base rent will be 2.1% lower immediately.

Year to date, we:

  • Signed 15 leases with a weighted average lease term of 6.5 years totaling 40.99 MW and 239,096 CRSF that are expected to generate approximately $49.4 million of annualized GAAP base rent revenue which is equivalent to a GAAP rate of $101 per kW per month.
  • Commenced 15 leases totaling 31.44 MW and 182,523 CRSF.
  • Extended the maturity of seven leases totaling 12.24 MW and 69,081 CRSF by a weighted average of 3.0 years.  Compared to the rates in effect when the extension was executed, cash base rents will be an average of 5.4% higher upon the expiration of the original lease terms.  GAAP base rents will be an average of 4.5% higher immediately.  The average GAAP rate related to these extensions was $110 per kW per month.

Development Update

We are currently developing ACC7 Phase II (8.9 MW), ACC7 Phase III (11.9 MW), CH2 Phase II (5.7 MW) and CH2 Phase III (12.5 MW).  We anticipate that ACC7 Phase II, which is 67% pre-leased, will be placed into service in the fourth quarter of 2015, ACC7 Phase III and CH2 Phase II will be placed into service in the second quarter of 2016, and that CH2 Phase III will be placed into service the third quarter of 2016.

In the third quarter, we purchased a parcel of land totaling 9.7 acres adjacent to our CH1 data center for $8.6 million.  This land is being held for the future development of CH3.

Balance Sheet and Liquidity

We increased the capacity of our line of credit from $560 million to $700 million in July 2015.  No other terms of the line of credit changed.  All $700 million is available as of October 29, 2015.

The Board approved a common stock repurchase program of $120 million for 2015, of which we purchased $31.9 million in the first quarter of 2015 at an average price of $31.80.  No shares were purchased in the second or third quarter of 2015.  There is $88.1 million remaining under this program for the remainder of 2015.

Dividend

Our third quarter 2015 dividend of $0.42 per share was paid on October 15, 2015 to shareholders of record as of October 2, 2015.  The anticipated 2015 annualized dividend of $1.68 per share represents an estimated AFFO payout ratio of 63% at the midpoint of our current 2015 guidance.

Fourth Quarter and Full Year 2015 Guidance

We are increasing the mid-point of our 2015 Normalized FFO guidance range by $0.03 per share.  The new range is $2.45 to $2.47 per share compared to last quarter's range of $2.38 to $2.48 per share.  The increase in the mid-point is due to the following:

  • $0.01 per share from positive leasing results and
  • $0.02 per share from lower interest expense primarily due to increased capitalized interest.

Our Normalized FFO guidance range is $0.60 to $0.62 per share for the fourth quarter of 2015.  The mid-point of this range is $0.01 lower than Normalized FFO per share in the third quarter of 2015.  This is due to the following:

  • $0.05 per share of decreased revenue from Yahoo! vacating ACC2 and the new lease at ACC2 not commencing until the first quarter of 2016, partially offset by
  • $0.03 per share of increased operating income excluding depreciation from new lease commencements including the re-lease of the Net Data Centers space, partially offset by increased sales and marketing expenses, and
  • $0.01 per share from lower interest expense primarily due to increased capitalized interest. 

We increased the mid-point of our 2015 AFFO guidance range by $0.04 per share.  The new range is $2.63 to $2.67 per share compared to last quarter's range of $2.56 to $2.66 per share.  This is primarily due to increased Normalized FFO.

Our AFFO guidance range is $0.60 to $0.64 per share for the fourth quarter of 2015.  The mid-point of the range is $0.06 per share lower than third quarter 2015 AFFO per share.  This is due to following:

  • Decrease in mid-point of Normalized FFO of $0.01 per share,
  • Decrease in the add-back of straight-line revenues of $0.03 per share, and
  • Increase in capitalized leasing commissions of $0.02 per share due to the heavy volume of leases executed in October.

The assumptions underlying Normalized FFO and AFFO guidance can be found on the last page of this earnings release.

Third Quarter 2015 Conference Call and Webcast Information

We will host a conference call to discuss these results today, Thursday, October 29, 2015 at 1:00 p.m. ET. To access the live call, please visit the Investor Relations section of our website at www.dft.com or dial 1-877-300-9306 (domestic) or 1-412-902-6613 (international).  A replay will be available for seven days by dialing 1-877-344-7529 (domestic) or 1-412-317-0088 (international) using passcode 10068308.  The webcast will be archived on our website for one year at www.dft.com on the Presentations & Webcasts page.

About DuPont Fabros Technology, Inc.

DuPont Fabros Technology, Inc. (NYSE: DFT) is a leading owner, developer, operator and manager of enterprise-class, carrier neutral, multi-tenant wholesale data centers.  The Company's facilities are designed to offer highly specialized, efficient and safe computing environments in a low-cost operating model.  The Company's customers outsource their mission critical applications and include national and international enterprises across numerous industries, such as technology, Internet content providers, media, communications, cloud-based, healthcare and financial services.  The Company's 12 data centers are located in four major U.S. markets, which total 2.9 million gross square feet and 257 megawatts of available critical load to power the servers and computing equipment of its customers.  DuPont Fabros Technology, Inc., a real estate investment trust (REIT), is headquartered in Washington, DC.  For more information, please visit www.dft.com.

Forward-Looking Statements

Certain statements contained in this press release may be deemed to be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  The matters described in these forward-looking statements include expectations regarding future events, results and trends and are subject to known and unknown risks, uncertainties and other unpredictable factors, many of which are beyond our control. We face many risks that could cause our actual performance to differ materially from the results contemplated by our forward-looking statements, including, without limitation, the risk that the assumptions underlying our full year and third quarter 2015 guidance are not realized, the risks related to the leasing of available space to third-party customers, including delays in executing new leases, failure to negotiate leases on terms that will enable us to achieve our expected returns and declines in rental rates at new and existing facilities, risks related to the collection of accounts and notes receivable, the risk that we may be unable to obtain new financing on favorable terms to facilitate, among other things, future development projects, the risks commonly associated with construction and development of new facilities (including delays and/or cost increases associated with the completion of new developments), risks relating to obtaining required permits and compliance with permitting, zoning, land-use and environmental requirements, the risk that we will not declare and pay dividends as anticipated for 2015 and the risk that we may not be able to maintain our qualification as a REIT for federal tax purposes.  The periodic reports that we file with the Securities and Exchange Commission, including the annual report on Form 10-K for the year ended December 31, 2014 and the quarterly reports on Form 10-Q for the quarters ended June 30, 2015 and March 31, 2015 contain detailed descriptions of these and many other risks to which we are subject.  These reports are available on our website at www.dft.com.  Because of the risks described above and other unknown risks, our actual results, performance or achievements may differ materially from the results, performance or achievements contemplated by our forward-looking statements.  The information set forth in this news release represents our expectations and intentions only as of the date of this press release.  We assume no responsibility to issue updates to the contents of this press release.

 

DUPONT FABROS TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited and in thousands except share and per share data)

Three months ended September 30,

Nine months ended September 30,

2015

2014

2015

2014

Revenues:

Base rent

$

76,771

$

72,268

$

221,046

$

211,927

Recoveries from tenants

35,223

31,211

103,010

92,864

Other revenues

3,343

2,099

12,421

4,824

Total revenues

115,337

105,578

336,477

309,615

Expenses:

Property operating costs

33,209

29,127

94,362

87,004

Real estate taxes and insurance

5,348

4,108

16,387

10,986

Depreciation and amortization

26,433

24,799

77,645

71,671

General and administrative

4,422

4,561

13,233

12,669

Other expenses

2,947

1,517

15,752

3,989

Total expenses

72,359

64,112

217,379

186,319

Operating income

42,978

41,466

119,098

123,296

Interest income

10

6

51

113

Interest:

Expense incurred

(11,691)

(9,032)

(29,042)

(24,563)

Amortization of deferred financing costs

(904)

(805)

(2,240)

(2,271)

Loss on early extinguishment of debt

—

(1,363)

—

(1,701)

Net income

30,393

30,272

87,867

94,874

Net income attributable to redeemable noncontrolling interests – operating partnership

(4,520)

(4,501)

(12,901)

(14,315)

Net income attributable to controlling interests

25,873

25,771

74,966

80,559

Preferred stock dividends

(6,811)

(6,811)

(20,433)

(20,433)

Net income attributable to common shares

$

19,062

$

18,960

$

54,533

$

60,126

Earnings per share – basic:

Net income attributable to common shares

$

0.29

$

0.29

$

0.83

$

0.91

Weighted average common shares outstanding

65,041,159

65,507,879

65,190,737

65,448,034

Earnings per share – diluted:

Net income attributable to common shares

$

0.29

$

0.29

$

0.82

$

0.91

Weighted average common shares outstanding

65,561,891

66,298,221

65,918,976

66,025,002

Dividends declared per common share

$

0.42

$

0.35

$

1.26

$

1.05

 

 

DUPONT FABROS TECHNOLOGY, INC.

RECONCILIATIONS OF NET INCOME TO NAREIT FFO, NORMALIZED FFO AND AFFO (1)

(unaudited and in thousands except share and per share data)

Three months endedSeptember 30,

Nine months endedSeptember30,

2015

2014

2015

2014

Net income

$

30,393

$

30,272

$

87,867

$

94,874

Depreciation and amortization

26,433

24,799

77,645

71,671

Less: Non real estate depreciation and amortization

(202)

(195)

(503)

(552)

NAREIT FFO

56,624

54,876

165,009

165,993

Preferred stock dividends

(6,811)

(6,811)

(20,433)

(20,433)

NAREIT FFO attributable to common shares and common units

49,813

48,065

144,576

145,560

Severance expense and equity acceleration

546

—

6,124

—

Loss on early extinguishment of debt

—

1,363

—

1,701

Normalized FFO attributable to common shares and common units

50,359

49,428

150,700

147,261

Straight-line revenues, net of reserve

4,260

2,280

13,410

4,296

Amortization and write-off of lease contracts above and below market value

(585)

(598)

(763)

(1,795)

Compensation paid with Company common shares

1,326

1,545

3,955

4,645

Non real estate depreciation and amortization

202

195

503

552

Amortization of deferred financing costs

904

805

2,240

2,271

Improvements to real estate

(1,185)

(1,063)

(2,433)

(2,083)

Capitalized leasing commissions

(14)

(322)

(2,026)

(1,899)

AFFO attributable to common shares and common units

$

55,267

$

52,270

$

165,586

$

153,248

NAREIT FFO attributable to common shares and common units per share - diluted

$

0.61

$

0.59

$

1.78

$

1.78

Normalized FFO attributable to common shares and common units per share - diluted

$

0.62

$

0.60

$

1.85

$

1.80

AFFO attributable to common shares and common units per share - diluted

$

0.68

$

0.64

$

2.03

$

1.88

Weighted average common shares and common units outstanding - diluted

81,066,670

81,862,208

81,429,886

81,608,159

(1)  Funds from operations, or FFO, is used by industry analysts and investors as a supplemental operating performance measure for REITs. We calculate FFO in accordance with the definition that was adopted by the Board of Governors of the National Association of Real Estate Investment Trusts, or NAREIT. FFO, as defined by NAREIT, represents net income determined in accordance with GAAP, excluding extraordinary items as defined under GAAP, impairment charges on depreciable real estate assets and gains or losses from sales of previously depreciated operating real estate assets, plus specified non-cash items, such as real estate asset depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. We also present FFO attributable to common shares and OP units, which is FFO excluding preferred stock dividends. FFO attributable to common shares and OP units per share is calculated on a basis consistent with net income attributable to common shares and OP units and reflects adjustments to net income for preferred stock dividends.

We use FFO as a supplemental performance measure because, in excluding real estate related depreciation and amortization and gains and losses from property dispositions, it provides a performance measure that, when compared period over period, captures trends in occupancy rates, rental rates and operating expenses. We also believe that, as a widely recognized measure of the performance of equity REITs, FFO may be used by investors as a basis to compare our operating performance with that of other REITs. However, because FFO excludes real estate related depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effects and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited.

While FFO is a relevant and widely used measure of operating performance of equity REITs, other equity REITs may use different methodologies for calculating FFO and, accordingly, FFO as disclosed by such other REITs may not be comparable to our FFO. Therefore, we believe that in order to facilitate a clear understanding of our historical operating results, FFO should be examined in conjunction with net income as presented in the consolidated statements of operations. FFO should not be considered as an alternative to net income or to cash flow from operating activities (each as computed in accordance with GAAP) or as an indicator of our liquidity, nor is it indicative of funds available to meet our cash needs, including our ability to pay dividends or make distributions.

We present FFO with adjustments to arrive at Normalized FFO.  Normalized FFO is FFO attributable to common shares and units excluding severance expense and equity accelerations, gain or loss on early extinguishment of debt and gain or loss on derivative instruments.   We also present FFO with supplemental adjustments to arrive at Adjusted FFO ("AFFO"). AFFO is Normalized FFO excluding straight-line revenue, compensation paid with Company common shares, below market lease amortization and write-offs net of above market lease amortization and write-offs, non real estate depreciation and amortization, amortization of deferred financing costs, improvements to real estate and capitalized leasing commissions.  AFFO does not represent cash generated from operating activities in accordance with GAAP and therefore should not be considered an alternative to net income as an indicator of our operating performance or as an alternative to cash flow provided by operations as a measure of liquidity and is not necessarily indicative of funds available to fund our cash needs including our ability to pay dividends. In addition, AFFO may not be comparable to similarly titled measurements employed by other companies. We use AFFO in management reports to provide a measure of REIT operating performance that can be compared to other companies using AFFO.

 

DUPONT FABROS TECHNOLOGY, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands except share data)

September 30, 2015

December 31, 2014

(unaudited)

ASSETS

Income producing property:

Land

$

92,840

$

83,793

Buildings and improvements

2,799,849

2,623,539

2,892,689

2,707,332

Less: accumulated depreciation

(571,996)

(504,869)

Net income producing property

2,320,693

2,202,463

Construction in progress and land held for development

330,200

358,965

Net real estate

2,650,893

2,561,428

Cash and cash equivalents

67,836

29,598

Rents and other receivables, net

8,605

8,113

Deferred rent, net

128,955

142,365

Lease contracts above market value, net

6,251

8,054

Deferred costs, net

38,510

38,495

Prepaid expenses and other assets

47,670

48,295

Total assets

$

2,948,720

$

2,836,348

LIABILITIES AND STOCKHOLDERS' EQUITY

Liabilities:

Line of credit

$

—

$

60,000

Mortgage notes payable

115,000

115,000

Unsecured term loan

250,000

250,000

Unsecured notes payable, net of discount

848,074

600,000

Accounts payable and accrued liabilities

30,273

26,973

Construction costs payable

21,534

32,949

Accrued interest payable

6,623

10,759

Dividend and distribution payable

39,688

39,981

Lease contracts below market value, net

4,471

7,037

Prepaid rents and other liabilities

69,758

65,174

Total liabilities

1,385,421

1,207,873

Redeemable noncontrolling interests – operating partnership

399,050

513,134

Commitments and contingencies

—

—

Stockholders' equity:

Preferred stock, $.001 par value, 50,000,000 shares authorized:

Series A cumulative redeemable perpetual preferred stock, 7,400,000 issued and outstanding at September 30, 2015 and December 31, 2014

185,000

185,000

Series B cumulative redeemable perpetual preferred stock, 6,650,000 issued and outstanding at September 30, 2015 and December 31, 2014

166,250

166,250

Common stock, $.001 par value, 250,000,000 shares authorized, 65,381,914 shares issued and outstanding at September 30, 2015 and 66,061,804 shares issued and outstanding at December 31, 2014

65

66

Additional paid in capital

812,934

764,025

Retained earnings

—

—

Total stockholders' equity

1,164,249

1,115,341

Total liabilities and stockholders' equity

$

2,948,720

$

2,836,348

 

DUPONT FABROS TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

Nine months ended September 30,

2015

2014

Cash flow from operating activities

Net income

$

87,867

$

94,874

Adjustments to reconcile net income to net cash provided by operating activities

Depreciation and amortization

77,645

71,671

Loss on early extinguishment of debt

—

1,701

Straight-line revenues, net of reserve

13,410

4,296

Amortization of deferred financing costs

2,240

2,271

Amortization and write-off of lease contracts above and below market value

(763)

(1,795)

Compensation paid with Company common shares

7,990

4,645

Changes in operating assets and liabilities

Rents and other receivables

(492)

2,623

Deferred costs

(2,045)

(1,904)

Prepaid expenses and other assets

1,741

(7,088)

Accounts payable and accrued liabilities

3,407

2,814

Accrued interest payable

(4,136)

(8,048)

Prepaid rents and other liabilities

4,526

5,752

Net cash provided by operating activities

191,390

171,812

Cash flow from investing activities

Investments in real estate – development

(154,165)

(188,443)

Land acquisition costs

(8,600)

—

Interest capitalized for real estate under development

(8,557)

(7,889)

Improvements to real estate

(2,433)

(2,083)

Additions to non-real estate property

(622)

(292)

Net cash used in investing activities

(174,377)

(198,707)

Cash flow from financing activities

Line of credit:

Proceeds

120,000

—

Repayments

(180,000)

—

Unsecured term loan:

Proceeds

—

96,000

Unsecured notes payable:

Proceeds

248,012

—

Payments of financing costs

(4,730)

(3,794)

Equity compensation (payments) proceeds

(7,611)

2,303

Common stock repurchases

(31,912)

—

Dividends and distributions:

Common shares

(82,665)

(62,374)

Preferred shares

(20,433)

(20,433)

Redeemable noncontrolling interests – operating partnership

(19,436)

(14,822)

Net cash provided by (used in) financing activities

21,225

(3,120)

Net increase (decrease) in cash and cash equivalents

38,238

(30,015)

Cash and cash equivalents, beginning

29,598

38,733

Cash and cash equivalents, ending

$

67,836

$

8,718

Supplemental information:

Cash paid for interest

$

41,735

$

40,500

Deferred financing costs capitalized for real estate under development

$

584

$

459

Construction costs payable capitalized for real estate under development

$

21,534

$

35,860

Redemption of operating partnership units

$

598

$

3,000

Adjustments to redeemable noncontrolling interests - operating partnership

$

(106,959)

$

38,266

 

DUPONT FABROS TECHNOLOGY, INC.

Operating Properties

As of October 1, 2015

Property

Property Location

Year Built/Renovated

GrossBuilding Area (2)

Computer RoomSquare Feet("CRSF") (2)

CRSF %Leased (3)

CRSF %Commenced (4)

CriticalLoad MW (5)

CriticalLoad % Leased (3)

CriticalLoad % Commenced (4)

Stabilized (1)

ACC2 (6)

Ashburn, VA

2001/2005

87,000

53,000

—

%

—

%

10.4

—

%

—

%

ACC3

Ashburn, VA

2001/2006

147,000

80,000

100

%

100

%

13.9

100

%

100

%

ACC4 (7)

Ashburn, VA

2007

347,000

172,000

100

%

100

%

36.4

100

%

100

%

ACC5 (7)

Ashburn, VA

2009-2010

360,000

176,000

96

%

96

%

36.4

96

%

96

%

ACC6

Ashburn, VA

2011-2013

262,000

130,000

100

%

100

%

26.0

100

%

100

%

CH1

Elk Grove Village, IL

2008-2012

485,000

231,000

100

%

100

%

36.4

100

%

100

%

NJ1 Phase I (7)

Piscataway, NJ

2010

180,000

88,000

70

%

70

%

18.2

59

%

59

%

SC1

Santa Clara, CA

2011-2015

360,000

173,000

100

%

100

%

36.6

100

%

100

%

VA3 (7)

Reston, VA

2003

256,000

147,000

94

%

94

%

13.0

95

%

95

%

VA4

Bristow, VA

2005

230,000

90,000

100

%

100

%

9.6

100

%

100

%

Subtotal – stabilized

2,714,000

1,340,000

93

%

93

%

236.9

92

%

92

%

Completed, not Stabilized

ACC7 Phase I (8)

Ashburn, VA

2014

126,000

67,000

75

%

75

%

12.9

77

%

77

%

CH2 Phase I (9)

Elk Grove Village, IL

2015

94,000

45,000

20

%

20

%

7.4

19

%

19

%

Subtotal – not stabilized

220,000

112,000

53

%

53

%

20.3

56

%

56

%

Total Operating Properties

2,934,000

1,452,000

90

%

90

%

257.2

89

%

89

%

(1)

Stabilized operating properties are either 85% or more leased and commenced or have been in service for 24 months or greater.

(2)

Gross building area is the entire building area, including CRSF (the portion of gross building area where our customers' computer servers are located), common areas, areas controlled by us (such as the mechanical, telecommunications and utility rooms) and, in some facilities, individual office and storage space leased on an as available basis to our customers.

(3)

Percentage leased is expressed as a percentage of CRSF or critical load, as applicable, that is subject to an executed lease. Leases executed as of October 1, 2015 represent $297 million of base rent on a GAAP basis and $310 million of base rent on a cash basis over the next twelve months. Both amounts include $18 million of revenue from management fees over the next twelve months.

(4)

Percentage commenced is expressed as a percentage of CRSF or critical load, as applicable, where the lease has commenced under generally accepted accounting principles.

(5)

Critical load (also referred to as IT load or load used by customers' servers or related equipment) is the power available for exclusive use by customers expressed in terms of megawatt, or MW, or kilowatt, or kW (1 MW is equal to 1,000 kW).

(6)

As of October 29, 2015, ACC2 was 100% leased on a critical load and CRSF basis.

(7)

In October 2015, new leases were executed with the purchaser of Net Data Centers' operations at our ACC4, ACC5, NJ1 Phase I and VA3 facilities. The new leases at ACC4, ACC5 and NJ1 Phase I are for the same amount of CRSF as the Net Data Centers leases, but are for a reduced amount of critical load. Giving effect to these decreases, ACC4, ACC5 and NJ1 Phase I were 97%, 96% and 52% leased and commenced on a critical load basis, respectively as of October 29, 2015.  VA3 remains 95% leased and commenced on a critical load basis.

(8)

As of October 29, 2015, ACC7 Phase I was 100% leased and commenced on a critical load and CRSF basis.

(9)

As of October 29, 2015, CH2 Phase I was 100% leased and commenced on a critical load and CRSF basis.

 

DUPONT FABROS TECHNOLOGY, INC.

Lease Expirations

As of October 1, 2015

The following table sets forth a summary schedule of lease expirations at our operating properties for each of the ten calendar years beginning with 2015. The information set forth in the table below assumes that customers exercise no renewal options and takes into account customers' early termination options in determining the life of their leases under GAAP.

Year of Lease Expiration

Numberof Leases Expiring (1)

CRSF ofExpiring Commenced Leases (in thousands) (2)

% ofLeased CRSF

Total kWof Expiring Commenced Leases (2)

% ofLeased kW

% ofAnnualized Base Rent (3)

Month-to-month (4)

4

39

3.0

%

6,249

2.7

%

2.4

%

2015

—

—

—

%

—

—

%

—

%

2016

2

9

0.7

%

1,679

0.7

%

1.0

%

2017

13

84

6.5

%

13,905

6.1

%

6.0

%

2018

21

180

13.8

%

34,017

14.9

%

14.8

%

2019

20

291

22.4

%

51,740

22.7

%

23.0

%

2020

15

182

14.0

%

32,404

14.2

%

13.8

%

2021

11

160

12.3

%

26,138

11.5

%

11.8

%

2022

7

89

6.8

%

15,509

6.8

%

6.6

%

2023

3

29

2.2

%

4,386

1.9

%

1.7

%

2024

8

112

8.6

%

19,279

8.4

%

9.9

%

After 2024

9

127

9.7

%

22,856

10.1

%

9.0

%

Total

113

1,302

100

%

228,162

100

%

100

%

(1)

Represents 38 customers with 113 lease expiration dates.

(2)

CRSF is that portion of gross building area where customers locate their computer servers. One MW is equal to 1,000 kW.

(3)

Annualized base rent represents the monthly contractual base rent (defined as cash base rent before abatements) multiplied by 12 for commenced leases as of October 1, 2015.

(4)

Comprised of four leases with our bankrupt customer that were terminated on October 20, 2015 when a new customer leased all of the CRSF and 4.13 MW. The new leases expire in 2023.

 

 

DUPONT FABROS TECHNOLOGY, INC.

Top 15 Customers

As of October 1, 2015

The following table presents our top 15 customers based on annualized monthly contractual base rent at our operating properties as of October 1, 2015:

Customer

Number of Buildings

Number of Markets

Remaining Term

% ofAnnualized Base Rent (1)

1

Microsoft

6

3

6.0

22.7

%

2

Facebook

4

1

4.8

19.9

%

3

Rackspace

3

2

9.8

10.3

%

4

Yahoo! (2)

2

2

2.5

7.5

%

5

Fortune 1000 leading Software as a Service (SaaS) Provider, Not Rated

4

2

6.9

6.5

%

6

Fortune 25 Investment Grade Rated Company

2

2

2.9

5.4

%

7

Server Central

1

1

5.9

2.8

%

8

Net Data Centers (3)

4

2

MTM

2.4

%

9

Dropbox

1

1

3.3

1.8

%

10

IAC

1

1

3.6

1.8

%

11

Symantec

2

1

1.7

1.5

%

12

Fortune 25 Investment Grade Rated Company

2

2

5.4

1.3

%

13

Zynga

1

1

0.6

1.3

%

14

UBS

1

1

9.8

1.2

%

15

Sanofi Aventis

2

1

5.8

1.1

%

Total

87.5

%

(1)

Annualized base rent represents monthly contractual base rent (defined as cash base rent before abatements) multiplied by 12 for commenced leases as of October 1, 2015.

(2)

Comprised of a lease at ACC4 which is 6.9% of annualized base rent that has been fully subleased to another DFT customer and a lease at NJ1 which is 0.6% of annualized base rent.

(3)

Comprised of four month-to-month leases with our bankrupt customer that were terminated on October 20, 2015 when a new customer leased all of the CRSF and 4.13 of the MW. The new leases expire in 2023.

 

 

DUPONT FABROS TECHNOLOGY, INC.

Same Store Analysis

($ in thousands)

Same Store Properties

Three Months Ended

Nine Months Ended

30-Sep-15

30-Sep-14

% Change

30-Jun-15

% Change

30-Sep-15

30-Sep-14

% Change

Revenue:

Base rent

$

73,398

$

72,029

1.9

%

$

70,626

3.9

%

$

214,552

$

211,688

1.4

%

Recoveries from tenants

34,595

31,211

10.8

%

34,256

1.0

%

101,973

92,864

9.8

%

Other revenues

494

461

7.2

%

486

1.6

%

1,456

1,376

5.8

%

Total revenues

108,487

103,701

4.6

%

105,368

3.0

%

317,981

305,928

3.9

%

Expenses:

Property operating costs

31,232

28,613

9.2

%

28,686

8.9

%

90,293

86,489

4.4

%

Real estate taxes and insurance

5,111

3,990

28.1

%

6,928

(26.2)

%

15,810

10,861

45.6

%

Other expenses

10

18

N/M         

30

N/M         

55

95

(42.1)

%

Total expenses

36,353

32,621

11.4

%

35,644

2.0

%

106,158

97,445

8.9

%

Net operating income (1)

72,134

71,080

1.5

%

69,724

3.5

%

211,823

208,483

1.6

%

Straight-line revenues, net of reserve

4,394

2,517

N/M         

4,339

1.3

%

12,224

4,533

N/M         

Amortization of lease contracts above and below market value

(585)

(598)

(2.2)

%

415

N/A         

(763)

(1,795)

(57.5)

%

Cash net operating income (1)

$

75,943

$

72,999

4.0

%

$

74,478

2.0

%

$

223,284

$

211,221

5.7

%

Note: Same Store Properties represent those properties placed into service on or before January 1, 2014 and excludes ACC7.

Same Store, Same Capital Properties

Three Months Ended

Nine Months Ended

30-Sep-15

30-Sep-14

% Change

30-Jun-15

% Change

30-Sep-15

30-Sep-14

% Change

Revenue:

Base rent

$

62,998

$

64,906

(2.9)

%

$

61,032

3.2

%

$

186,769

$

193,344

(3.4)

%

Recoveries from tenants

26,266

26,838

(2.1)

%

26,337

(0.3)

%

80,265

80,344

(0.1)

%

Other revenues

464

435

6.7

%

457

1.5

%

1,366

1,289

6.0

%

Total revenues

89,728

92,179

(2.7)%

87,826

2.2

%

268,400

274,977

(2.4)

%

Expenses:

Property operating costs

24,681

24,500

0.7

%

23,302

5.9

%

73,568

75,162

(2.1)

%

Real estate taxes and insurance

3,219

3,198

0.7

%

3,350

(3.9)

%

9,463

8,707

8.7

%

Other expenses

9

17

N/M         

14

N/M         

35

77

(54.5)

%

Total expenses

27,909

27,715

0.7

%

26,666

4.7

%

83,066

83,946

(1.0)

%

Net operating income (1)

61,819

64,464

(4.1)

%

61,160

1.1

%

185,334

191,031

(3.0)

%

Straight-line revenues, net of reserve

4,329

2,871

N/M         

4,716

(8.2)

%

12,723

5,205

N/M         

Amortization of lease contracts above and below market value

(585)

(598)

(2.2)

%

415

N/A         

(763)

(1,795)

(57.5)

%

Cash net operating income (1)

$

65,563

$

66,737

(1.8)

%

$

66,291

(1.1)

%

$

197,294

$

194,441

1.5

%

Note: Same Store, Same Capital properties represent those properties placed into service on or before January 1, 2014 and have less than 10% of additional critical load developed after January 1, 2014. Excludes SC1 and ACC7. (1) See next page for a reconciliation of Net Operating Income and Cash Net Operating Income to GAAP measures.

 

 

DUPONT FABROS TECHNOLOGY, INC.

Same Store Analysis - Reconciliations of Operating Income

to Net Operating Income and Cash Net Operating Income (1)

($ in thousands)

Reconciliation of Operating Income to Same Store Net Operating Income and Cash Net Operating Income

Three Months Ended

Nine Months Ended

30-Sep-15

30-Sep-14

30-Jun-15

30-Sep-15

30-Sep-14

Operating income

$

42,978

$

41,466

$

40,898

$

119,098

$

123,296

Add-back: non-same store operating loss

4,464

5,395

3,718

18,970

14,128

Same Store:

Operating income

47,442

46,861

44,616

138,068

137,424

Depreciation and amortization

24,692

24,219

25,108

73,755

71,059

Net operating income

72,134

71,080

69,724

211,823

208,483

Straight-line revenues, net of reserve

4,394

2,517

4,339

12,224

4,533

Amortization of lease contracts above and below market value

(585)

(598)

415

(763)

(1,795)

Cash net operating income

$

75,943

$

72,999

$

74,478

$

223,284

$

211,221

Reconciliation of Operating Income to Same Store, Same Capital Net Operating Income and Cash Net Operating Income

Three Months Ended

Nine Months Ended

30-Sep-15

30-Sep-14

30-Jun-15

30-Sep-15

30-Sep-14

Operating income

$

42,978

$

41,466

$

40,898

$

119,098

$

123,296

Add-back: non-same store operating (income) loss

(2,110)

1,564

(1,397)

2,452

3,521

Same Store:

Operating income

40,868

43,030

39,501

121,550

126,817

Depreciation and amortization

20,951

21,434

21,659

63,784

64,214

Net operating income

61,819

64,464

61,160

185,334

191,031

Straight-line revenues, net of reserve

4,329

2,871

4,716

12,723

5,205

Amortization of lease contracts above and below market value

(585)

(598)

415

(763)

(1,795)

Cash net operating income

$

65,563

$

66,737

$

66,291

$

197,294

$

194,441

(1)

Net Operating Income ("NOI") represents total revenues less property operating costs, real estate taxes and insurance, and other expenses (each as reflected in the consolidated statements of operations) for the properties included in the analysis. Cash Net Operating Income ("Cash NOI") is NOI less straight-line revenues, net of reserve and amortization of lease contracts above and below market value for the properties included in the analysis.

We use NOI and Cash NOI as supplemental performance measures because, in excluding depreciation and amortization and gains and losses from property dispositions, each provides a performance measure that, when compared period over period, captures trends in occupancy rates, rental rates and operating expenses. However, because NOI and Cash NOI exclude depreciation and amortization and capture neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of our properties, all of which have real economic effects and could materially impact our results from operations, the utility of NOI and Cash NOI as a measure of our performance is limited.

Other REITs may not calculate NOI and Cash NOI in the same manner we do and, accordingly, our NOI and Cash NOI may not be comparable to the NOI and Cash NOI of other REITs. NOI and Cash NOI should not be considered as an alternative to operating income (as computed in accordance with GAAP).

 

 

DUPONT FABROS TECHNOLOGY, INC.

Development Projects

As of September 30, 2015

($ in thousands)

Property

PropertyLocation

GrossBuilding Area (1)

CRSF (2)

CriticalLoad MW (3)

EstimatedTotal Cost (4)

Constructionin Progress & Land Held for Development (5)

CRSF %Pre- leased

CriticalLoad % Pre- leased

Current Development Projects

ACC7 Phase II (6)

Ashburn, VA

98,000

51,000

8.9

   $74,000 - $78,000

$

65,532

33

%

33

%

ACC7 Phase III

Ashburn, VA

126,000

68,000

11.9

   102,000 - 106,000

50,277

—

%

—

%

CH2 Phase II

Elk Grove Village, IL

74,000

35,000

5.7

   60,000 - 64,000

45,694

—

%

—

%

298,000

154,000

26.5

  236,000 - 248,000

161,503

Future Development Projects/Phases

ACC7 Phase IV

Ashburn, VA

96,000

52,000

7.9

38,937

38,937

CH2 Phase III (7)

Elk Grove Village, IL

168,000

80,000

12.5

  142,000 - 146,000

71,888

NJ1 Phase II

Piscataway, NJ

180,000

88,000

18.2

39,212

39,212

444,000

220,000

38.6

$220,149 -  $224,149

150,037

Land Held for Development

ACC8

Ashburn, VA

100,000

50,000

10.4

4,243

CH3 (8)

Elk Grove Village, IL

214,000

119,000

22.0

8,525

SC2 (9)

Santa Clara, CA

150,000

69,000

16.0

5,892

464,000

238,000

48.4

18,660

Total

1,206,000

612,000

113.5

$

330,200

(1)

Gross building area is the entire building area, including CRSF (the portion of gross building area where our customers' computer servers are located), common areas, areas controlled by us (such as the mechanical, telecommunications and utility rooms) and, in some facilities, individual office and storage space leased on an as available basis to our customers.  The respective amounts listed for each of the "Land Held for Development" sites are estimates.

(2)

CRSF is that portion of gross building area where customers locate their computer servers. The respective amounts listed for each of the "Land Held for Development" sites are estimates.

(3)

Critical load (also referred to as IT load or load used by customers' servers or related equipment) is the power available for exclusive use by customers expressed in terms of MW or kW (1 MW is equal to 1,000 kW).  The respective amounts listed for each of the "Land Held for Development" sites are estimates.

(4)

Current development projects include land, capitalization for construction and development and capitalized interest and operating carrying costs, as applicable, upon completion. Future development projects/phases include land, shell and underground work through the opening of the phase(s) that are either under current development or in service.

(5)

Amount capitalized as of September 30, 2015. Future development projects/phases include land, shell and underground work through the opening of the phase(s) that are either under current development or in service.

(6)

As of October 29, 2015, ACC7 Phase II is 67% pre-leased on a critical load and CRSF basis.

(7)

CH2 Phase III was placed into development in October 2015, and the estimate listed above is for the completion of this phase.

(8)

Amounts listed for gross building area, CRSF and critical load are current estimates.

(9)

Amounts listed for gross building area, CRSF and critical load are current estimates. We are currently evaluating the best use for this land. Options include a stand-alone data center, an additional phase of SC1 or a powered base shell.

 

DUPONT FABROS TECHNOLOGY, INC.

Debt Summary as of September 30, 2015

($ in thousands)

September 30, 2015

Amounts

% of Total

Rates

Maturities

(years)

Secured

$

115,000

9

%

1.7

%

2.5

Unsecured

1,100,000

91

%

4.9

%

5.9

Total

$

1,215,000

100

%

4.6

%

5.6

Fixed Rate Debt:

Unsecured Notes due 2021

$

600,000

49

%

5.9

%

6.0

Unsecured Notes due 2023 (1)

250,000

21

%

5.6

%

7.7

Fixed Rate Debt

850,000

70

%

5.8

%

6.5

Floating Rate Debt:

Unsecured Credit Facility

—

—

%

—

%

2.6

Unsecured Term Loan

250,000

21

%

1.7

%

3.8

ACC3 Term Loan

115,000

9

%

1.7

%

2.5

Floating Rate Debt

365,000

30

%

1.7

%

3.4

Total

$

1,215,000

100

%

4.6

%

5.6

Note:      We capitalized interest and deferred financing cost amortization of $2.8 million and $9.1 million               during the three and nine months ended September 30, 2015, respectively.

(1)          Principal amount shown excludes original issue discount of $2.0 million.

 

Debt Principal Repayments as of September 30, 2015

($ in thousands)

Year

Fixed Rate

Floating Rate

Total

% of Total

Rates

2016

$

—

$

3,750

(3)

$

3,750

0.3

%

1.7

%

2017

—

8,750

(3)

8,750

0.7

%

1.7

%

2018

—

102,500

(3)

102,500

8.4

%

1.7

%

2019

—

250,000

(4)

250,000

20.6

%

1.7

%

2020

—

—

—

—

—

2021

600,000

(1)

—

600,000

49.4

%

5.9

%

2022

—

—

—

—

—

2023

250,000

(2)

—

250,000

20.6

%

5.6

%

Total

$

850,000

$

365,000

$

1,215,000

100

%

4.6

%

(1)

The 5.875% Unsecured Notes due 2021 mature on September 15, 2021.

(2)

The 5.625% Unsecured Notes due 2023 mature on June 15, 2023. Principal amount shown excludes original issue discount of $2.0 million.

(3)

The ACC3 Term Loan matures on March 27, 2018 with no extension option. Quarterly principal payments of $1.25 million begin on April 1, 2016, increase to $2.5 million on April 1, 2017 and continue through maturity.

(4)

The Unsecured Term Loan matures on July 21, 2019 with no extension option.

 

 

DUPONT FABROS TECHNOLOGY, INC.

Selected Unsecured Debt Metrics(1)

9/30/15

12/31/14

Interest Coverage Ratio (not less than 2.0)

4.7

6.1

Total Debt to Gross Asset Value (not to exceed 60%)

34.6%

30.8%

Secured Debt to Total Assets (not to exceed 40%)

3.3%

3.5%

Total Unsecured Assets to Unsecured Debt (not less than 150%)

259%

314%

(1)

These selected metrics relate to DuPont Fabros Technology, LP's outstanding unsecured notes.  DuPont Fabros Technology, Inc. is the general partner of DuPont Fabros Technology, LP.

 

Capital Structure as of September 30, 2015

(in thousands except per share data)

Line of Credit

$

—

Mortgage Notes Payable

115,000

Unsecured Term Loan

250,000

Unsecured Notes

850,000

Total Debt

1,215,000

33.2

%

Common Shares

81

%

65,382

Operating Partnership ("OP") Units

19

%

15,419

Total Shares and Units

100

%

80,801

Common Share Price at September 30, 2015

$

25.88

Common Share and OP Unit Capitalization

$

2,091,130

Preferred Stock ($25 per share liquidation preference)

351,250

Total Equity

2,442,380

66.8

%

Total Market Capitalization

$

3,657,380

100.0

%

 

 

DUPONT FABROS TECHNOLOGY, INC.

Common Share and OP Unit

Weighted Average Amounts Outstanding

Q3 2015

Q3 2014

YTD Q32015

YTD Q32014

Weighted Average Amounts Outstanding for EPS Purposes:

Common Shares - basic

65,041,159

65,507,879

65,190,737

65,448,034

Effect of dilutive securities

520,732

790,342

728,239

576,968

Common Shares - diluted

65,561,891

66,298,221

65,918,976

66,025,002

Weighted Average Amounts Outstanding for FFO,

Normalized FFO and AFFO Purposes:

Common Shares - basic

65,041,159

65,507,879

65,190,737

65,448,034

OP Units - basic

15,419,237

15,563,987

15,419,566

15,583,157

Total Common Shares and OP Units

80,460,396

81,071,866

80,610,303

81,031,191

Effect of dilutive securities

606,274

790,342

819,583

576,968

Common Shares and Units - diluted

81,066,670

81,862,208

81,429,886

81,608,159

Period Ending Amounts Outstanding:

Common Shares

65,381,914

OP Units

15,419,237

Total Common Shares and Units

80,801,151

 

 

DUPONT FABROS TECHNOLOGY, INC.

2015 Guidance

The earnings guidance/projections provided below are based on current expectations and are forward-looking.

Expected Q4 2015per share

Expected 2015per share

Net income per common share and common unit - diluted

   $0.27 to $0.29

  $1.09 to $1.11

Depreciation and amortization, net

0.33

1.28

NAREIT FFO per common share and common unit - diluted (1)

  $0.60 to $0.62

  $2.37 to $2.39

Severance expense and equity accelerations

—

0.08

Normalized FFO per common share and common unit - diluted (1)

  $0.60 to $0.62

  $2.45 to $2.47

Straight-line revenues, net of reserve

0.02

0.18

Amortization of lease contracts above and below market value

—

(0.01)

Compensation paid with Company common shares

0.02

0.07

Non real estate depreciation and amortization

—

(0.01)

Amortization of deferred financing costs

0.01

0.04

Improvements to real estate

(0.02) to (0.03)

(0.04) to (0.05)

Capitalized leasing commissions

(0.01) to (0.02)

 

(0.03) to (0.04)

AFFO per common share and common unit - diluted (1)

 $0.60 to $0.64

 $2.63 to $2.67

 

2015 Debt Assumptions

July 30, 2015 Guidance

October 29, 2015 Guidance

Weighted average debt outstanding

$1,165.0 million

$1,165.0 million

Weighted average interest rate (one month LIBOR avg. 0.19%)

4.48%

4.47%

Total interest costs

$52.2 million

$52.1 million

Amortization of deferred financing costs

4.2 million

3.9 million

      Interest expense capitalized

(10.7) million

(11.6) million

      Deferred financing costs amortization capitalized

(0.7) million

(0.8) million

Total interest expense after capitalization

$45.0 million

$43.6 million

2015 Other Guidance Assumptions

July 30, 2015 Guidance

October 29, 2015 Guidance

Total revenues

$435 to $445 million

         $440 to $445 million

Base rent (included in total revenues)

$292 to $300 million

          $295 to $300 million

General and administrative expense

$18 to $19 million

$18 million

Investments in real estate - development (2)

$180 to $200 million

$200 to $220 million

Improvements to real estate excluding development

$5 million

$4 million

Preferred stock dividends

$27 million

$27 million

Annualized common stock dividend

$1.68 per share

$1.68 per share

Weighted average common shares and OP units - diluted

82.0 million

82.0 million

Common share repurchase

$31.9 million

$31.9 million

Acquisitions of income producing properties

No amounts budgeted

No amounts budgeted

(1)

For information regarding FFO and Normalized FFO, see "Reconciliations of Net Income to FFO, Normalized FFO and AFFO" in this earnings release.

(2)

Represents cash spend expected in 2015 for the SC1 Phase IIB, CH2 Phase I, CH2 Phase II, CH2 Phase III, ACC7 Phase II and ACC7 Phase III developments.

 

Note: This press release supplement contains certain non-GAAP financial measures that we believe are helpful in understanding our business, as further discussed within this press release supplement.  These financial measures, which include NAREIT Funds From Operations, Normalized Funds From Operations, Adjusted Funds From Operations, Net Operating Income, Cash Net Operating Income, NAREIT Funds From Operations per share, Normalized Funds From Operations per share and Adjusted Funds From Operations per share, should not be considered as an alternative to net income, operating income, earnings per share or any other GAAP measurement of performance or as an alternative to cash flows from operating, investing or financing activities.  Furthermore, these non-GAAP financial measures are not intended to be a measure of cash flow or liquidity.  Information included in this supplemental package is unaudited.

 

To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/dupont-fabros-technology-inc-reports-third-quarter-2015-results-300168341.html

SOURCE DuPont Fabros Technology, Inc.


Serious News for Serious Traders! Try StreetInsider.com Premium Free!

You May Also Be Interested In





Related Categories

Press Releases

Related Entities

UBS, Dividend, Bankruptcy, Stock Buyback, Earnings, Definitive Agreement