Fourth Quarter & Full Year 2019 Financial Results 21 January 2020
Outline ◼ Key Highlights ◼ Financial Performance ◼ Capital Management ◼ Portfolio Update ◼ Outlook Important Notice: The past performance of Keppel DC REIT is not necessarily indicative of its future performance. Certain statements made in this presentation may not be based on historical information or facts and may be “forward - looking” statements due to a number of risks, uncertainties and assumptions. Representative examples of these factors include (without limitation) general industry and economic conditions, interest rate trends, cost of capital and capital availability, competition from similar developments, shifts in expected levels of property rental income, changes in operating expenses, including employee wages, benefits and training, property expenses and governmental and public policy changes, and the continued availability of financing in the amounts and terms necessary to support future business. Prospective investors and unitholders of Keppel DC REIT (“Unitholders”) are cautioned not to place undue reliance on these forward-looking statements, which are based on the current view of Keppel DC REIT Management Pte. Ltd., as manager of Keppel DC REIT (the “Manager”) on future events. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information, or opinions contained in this presentation. None of the Manager, the trustee of Keppel DC REIT or any of their respective advisors, representatives or agents shall have any responsibility or liability whatsoever (for negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. The information set out herein may be subject to updating, completion, revision, verification and amendment and such information may change materially. The value of units in Keppel DC REIT (“Units”) and the income derived from them may fall as well as rise. Units are not obligations of, deposits in, or guaranteed by, the Manager or any of its affiliates. An investment in Units is subject to investment risks, including the possible loss of the principal amount invested. Investors have no right to request the Manager to redeem their Units while the Units are listed. It is intended that Unitholders may only deal in their Units through trading on Singapore Exchange Securities Trading Limited (“SGX - ST”) . Listing of the Units on SGX-ST does not guarantee a liquid market for the Units. 2
Key Highlights for FY 2019 Low aggregate leverage Steady growth in Adjusted DPU, Stable income stream with increasing by 5.3% to 7.71 3 cents provides financial flexibility to healthy portfolio occupancy and pursue growth long WALE Adjusted DPU (cents) Portfolio Occupancy Aggregate Leverage 4 8.00 7.71 3 94.9% 30.7% +5.3% 7.32 6.97 2 as at 31 Dec 2019 as at 31 Dec 2019 7.00 6.68 1 6.51 Interest Coverage Portfolio WALE 6.00 13.3 times 8.6 years as at 31 Dec 2019 by leased area 5.00 FY2015 FY2016 FY2017 FY2018 FY2019 1. Exclude the impact of the pro-rata preferential offering and the one-off net property tax refund in 2016. 2. Exclude the one-off capital distribution for the month of December 2016 arising from the later completion of Keppel DC Singapore 3 in 2017. 3. Excluding the impact of the pro-rata preferential offering in October 2019. 4. Aggregate Leverage was computed based on gross borrowings as a percentage of the deposited properties, both of which do not take into consideration the lease liabilities 3 pertaining to land rent commitments and options.
Steady Growth Momentum Since IPO 12 Dec 2014 31 Dec 2019 2015 2016 2017 2018 2019 AUM: $1.0b AUM: $2.6b 2 17 assets IPO with 8 assets maincubes Keppel DC DC1 Intellicentre 2 Milan Data Centre across 8 countries across 6 countries Data Centre Singapore 3 Data Centre Cardiff Data Centre Keppel DC Keppel DC Keppel DC 31 Dec 2015 Singapore 5 Singapore 4 Dublin 2 AUM: $1.1b Intellicentre 3 31 Dec 2016 Kelsterbach East Data Centre AUM: $1.2b Data Centre 31 Dec 2017 AUM: $1.5b 31 Dec 2018 AUM: $2.0b 1 1.Exclude Intellicentre 3 East Data Centre which development is expected to be completed in 4Q 2020 4 2.Exclude Intellicentre 3 East Data Centre as well as Kelsterbach Data Centre which legal completion of the acquisition is expected in 2020
DPU-Accretive Acquisitions in Singapore and Germany ▪ Completed acquisitions of Keppel DC Singapore 4 and DC1 in 4Q 2019 ▪ Deepen presence in Germany with acquisition of Kelsterbach Data Centre, a purpose-built data centre facility located near the Frankfurt Airport 99% Interest in Keppel DC Singapore 4 100% Interest in DC1 100% interest in Kelsterbach Data Centre ▪ Five-storey purpose-built facility ▪ Fully leased on a triple-net basis ▪ Five-storey carrier-neutral and ▪ Triple-net master lease with remaining until end-2025 purpose-built colocation facility ▪ Acquisition expected to be completed ▪ Occupancy rate of 95.7% with IT power lease of 16.3 years as at 31 Dec 2019 in 2020 fully-committed as at 31 Dec 2019 5
Financial Performance 6
Distributable Income Distribution Per Unit (cents) +/(-) 4Q 4Q +/(-) FY FY ($’000) 2019 2018 % 2019 2018 % 8.00 Distributable Income to 7.61 31,464 26,126 20.4 113,245 96,096 17.8 +4.0% Unitholders 7.32 Comprising 7.00 Gross Revenue 52,981 48,043 10.3 194,826 175,535 11.0 Property Expenses (4,455) (5,576) (20.1) (17,543) (17,862) (1.8) 6.00 Net Property Income 48,526 42,467 14.3 177,283 157,673 12.4 FY 2018 FY 2019 Distribution per Unit 1,2 1.83 1.85 (1.1) 7.61 7.32 4.0 (DPU) (cents) Distribution for the period from 25 Sep to 31 Dec 2019 Adjusted DPU 3 (cents) 1.93 1.85 4.3 7.71 7.32 5.3 a) Taxable Income: 0.72 cents DPU b) Tax-exempt Income: 1.23 cents Distribution Yield 4 (%) 3.66 3.52 14bps Ex-Date 29 Jan 2020 1. Exclude an amount of capital expenditure that has been set aside. Book Closure 2. Keppel DC REIT paid an advanced distribution of 1.81 cents per Unit to eligible Unitholders on 27 Nov 2019 for 30 Jan 2020 Date the period from 1 Jul to 24 Sep 2019 in connection with the private placement launched on 16 Sep 2019. For the period from 25 Sep to 31 Dec 19, eligible unitholders will receive distribution of 1.95 cents per Unit. Keppel Payment Date 3 Mar 2020 DC REIT declares distributions on a half-yearly basis. 3. Excluding the impact of the pro-rata preferential offering in October 2019, the adjusted DPU for 4Q 2019 and FY 2019 would be 1.93 cents and 7.71 cents respectively. 7 4. Distribution yields were computed based on FY 2019 closing price of $2.080.
Balance Sheet Highlights As at As at +/(-) ($’000) 31 Dec 2019 31 Dec 2018 % Investment Properties 2,028,672 2,637,026 +30.0 Total Assets 2,259,144 2,927,994 +29.6 Gross Borrowings 1 673,952 870,388 +29.1 Total Liabilities 783,150 1,025,446 +30.9 Unitholders ’ Funds 1,444,839 1,868,018 +29.3 Units in Issue (’000) 1,632,395 1,351,578 +20.8 Net Asset Value (NAV) per Unit ($) 1.14 1.07 +6.5 Unit Price (Closing price of last trading day) ($) 1.350 2.080 +54.1 Premium to NAV (%) +26.2 +82.5 56.3pp 1.Gross borrowings relates to borrowings drawn down from loan facilities and the medium term note programme. 8
Aggregate Leverage As at As at +/(-) ($’000) 31 Dec 2019 31 Dec 2018 % Investment Properties 1 2,585,178 1,995,206 +29.6 (excluding lease liabilities commitments and options) Deposited Properties 1 2,187,396 2,838,306 +29.8 (excluding lease liabilities commitments and options) Gross Borrowings + Deferred Payment 673,952 870,388 +29.1 Aggregate Leverage 2 30.8% 30.7% (10bps) 1. Investment properties relates to carrying value and deposited properties relates to total assets as stipulated in the Property Fund Appendix in CIS Code, without considering lease liabilities pertaining to land rent commitments and options. 2. Aggregate Leverage was computed based on gross borrowings as a percentage of the deposited properties (Note 1). Taking into consideration lease liabilities pertaining to land rent commitments and options, the Aggregate Leverage will be 31.9% (2018: 31.9%). 9
Capital Management 10
Prudent Capital Management ◼ Maintaining low aggregate leverage: Provides flexibility and a healthy debt Debt Maturity Profile headroom for growth As at 31 Dec 2019 ◼ Raised $478.2m in gross proceeds through private placement and preferential offering of approx. 277.0m new Units 31.6% 13.7% 17.6% 6.8% 8.6% 7.7% 7.4% 2.8% 2.4% 1.4% 2020 2021 2022 2023 2024 2025 2026 SGD AUD GBP EUR As at 31 Dec 2019 ~$870.4m of external loans/notes Total debt 1. Computed based on gross borrowings as a percentage of (unencumbered) deposited properties, both of which do not consider the lease liabilities pertaining to land rent commitments and options. ~$190.6m of undrawn credit facilities Available facilities 2. Including amortisation of upfront debt financing costs and excluding lease charges. Aggregate Leverage 1 30.7% 3. Calculated as EBITDA over borrowing costs, after adjusting for non-cash items including but not limited to fair value changes in Average cost of debt 2 1.7% per annum investment properties and management fees paid in Units. Debt tenor 3.9 years Interest coverage 3 13.3 times 11
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