FY18 FULL-YEAR RESULTS 31 AUGUST 2018 NEXTDC LIMITED ACN 143 582 521
FY18 HIGHLIGHTS UNDERLYING EBITDA 1 REVENUE UTILISATION $161.5m $62.6m 40MW + 31% + 28% + 28% CUSTOMERS PARTNERS INTERCONNECTIONS 972 470+ 8,671 + 26% 60+ NETWORKS + 37% 1. Excludes distribution income of $3.2m from NEXTDC’s 29.2% investment in Asia Pacific Data Centre Group (APDC), as well as $1. 8m of costs related to the current APDC wind-up proposal Note: All percentage increases are expressed relative to the FY17 results 2 NEXTDC FY18 Results
FY18 HIGHLIGHTS ▪ Revenue from continuing operations up $38.0m 1 (31%) 1 to $161.5m Solid ▪ Contracted utilisation up 8.7MW 1 (28%) 1 to 40.2MW revenue growth ▪ Interconnections up 2,329 (37%) 1 to 8,671, representing 6.5% of recurring revenue ▪ Underlying EBITDA up $13.6m 1,2 (28%) 1,2 to $62.6m 2 Strong ▪ Operating cash flows down $11.5m 1 (26%) 1 to $33.4m operating leverage ▪ Profit before tax down $1.9m 1 (15%) 1 to $10.9m ▪ Cash and term deposits of $418m at 30 June 2018 Capitalised ▪ Pro-forma cash and term deposits of $718m, following $300m Notes IV raising in July 2018 for ▪ NEXTDC undrawn senior syndicated debt facility of $300m growth ▪ Balance sheet position underpinned by over $1.2bn of total assets ▪ $285m of capital invested across new and existing developments ▪ B2 and M2 opened and received Uptime Tier IV Certification of Constructed Facility (TCCF) Network ▪ B2 received Tier IV Gold Certification of Operational Sustainability 3 expansion continues ▪ S2 development on track for completion and customer access in 1H19 ▪ Announced development of three new sites at P2 Perth, S3 Sydney and M3 Melbourne 1. Compared to FY17 2. Excludes distribution income of $3.2m from NEXTDC’s 29.2% investment in APDC, as well as $1.8m of costs related to the curren t APDC wind-up proposal 3. Achieved 2 August 2018 3 NEXTDC FY18 Results
FY18 AGENDA FY18 Financial Results FY18 Business Performance FY19 Outlook Appendices
FY18 Full-Year Results FINANCIAL RESULTS
FY18 Profit and Loss summary FY18 FY17 Change Data centre services Underlying Note ($m) ($m) ($m) REVENUE EBITDA Data centre services revenue 152.6 117.6 35.0 30% 28% Other revenue 9.0 6.0 3.0 Total revenue from continuing operations 161.5 123.6 38.0 ▪ Net impact of rising energy costs ~10% 5 of total Direct costs (power and consumables) 27.6 16.6 11.0 direct costs in FY18 ▪ Facility costs include staff and property related costs Facility costs (data centre rent, property costs, 31.7 27.7 4.1 for B2, M2 and S2 maintenance, facility staff, other) ▪ Corporate costs includes additional operational, Corporate overheads 1 29.8 24.6 5.2 customer experience and IT spend to support new Total operating costs facility expansion 89.1 68.9 20.3 ▪ Full year run rate of new facility costs and other property holding costs (e.g. property rates and taxes EBITDA 2 for S3, P2 and M3) expected in FY19 64.0 49.0 15.0 Underlying EBITDA 3 62.6 49.0 13.6 1. Corporate overheads include costs related to all sales and marketing, centralised customer support, project management and product development, site selection due diligence and sundry project costs, provisions, EBIT 30.9 25.6 5.3 as well as investments in growth initiatives including partner development, customer experience and systems 2. EBITDA is a non-statutory metric representing earnings before interest, tax, depreciation and amortisation 3. Underlying EBITDA excludes distribution income of $3.2m from NEXTDC's investment in APDC, as well as $1.8m of costs related to the current APDC wind-up proposal Profit before tax 10.9 12.8 (1.9) 4. Profit after tax for FY17 includes an income tax benefit of $10.2m associated with the recognition of deferred tax assets 5. The net impact to direct costs resulting from movements in the price of energy, after adjusting for increases Profit after tax 4 6.6 23.0 (16.4) in total power consumption and power costs passed on to customers 6 NEXTDC FY18 Results
Solid revenue and EBITDA growth 28% growth on FY17 3,4 30% growth on FY17 Recurring and project revenue 1 Underlying EBITDA 3,4 $62.6m $152.6m Project revenue 2 Underlying EBITDA Recurring revenue $49.0m $117.6m $27.7m $89.3m $8.0m $58.7m $30.4m ($16.1m) $9.0m ($20.0m) FY13 FY14 FY15 FY16 FY17 FY18 FY13 FY14 FY15 FY16 FY17 FY18 1. Data centre services revenue excludes interest and data centre development revenue 2. Project revenue includes one-off setup costs for new customer fitouts, standard establishment fees for new services, remote hands and other services 3. FY13 and FY14 underlying EBITDA excludes building development profit, APDC distributions and fund raising advisory fees 4. FY18 underlying EBITDA excludes distribution income of $3.2m from NEXTDC’s 29.2% investment in APDC, as well as $1.8m of costs related to the curren t APDC wind-up proposal 7 NEXTDC FY18 Results
Revenue per unit metrics Annualised revenue per sqm ($) 1 Annualised revenue per MW ($m) 2 4.36 4.18 9,897 4.09 4.00 3.97 8,863 8,421 7,741 6,980 FY14 FY15 FY16 FY17 FY18 FY14 FY15 FY16 FY17 FY18 ▪ Demonstrates ongoing growth in revenue per square metre, noting the deployment of large, high density, ecosystem enhancing deals over time 1. Revenue reflects data centre services revenue less project ▪ New facility developments designed to take advantage of industry movements toward higher density requirements revenue. Square metres are the total weighted average ▪ square metres utilised during the period Revenue derived from larger ecosystem enhancing customer deployments tends to increase over time as they mature, due 2. Revenue reflects data centre services revenue less project to higher usage of contracted power capacity, increased demand for interconnection, and the use of ancillary services revenue. Metric reflects the total weighted average megawatt months billed over the period 8 NEXTDC FY18 Results
Business model delivers significant operating leverage EBITDAR / Data centre services revenue 1,2,3 Corporate costs / Data centre services revenue 2,3 56% 53% 68% 49% (13%) 35% 30% 21% 20% (81%) FY14 FY15 FY16 FY17 FY18 FY14 FY15 FY16 FY17 FY18 ▪ EBITDAR margin is a property-agnostic indicator of underlying ▪ Strong corporate cost performance drives significant operating profitability leverage ▪ Strong margin performance reflects the benefit of operating ▪ Expect near term scale benefits as capacity expands leverage 1. EBITDAR represents EBITDA plus data centre rent 2. FY14 excludes building development profit, APDC distributions and fund raising advisory fees 3. FY18 e xcludes distribution income of $3.2m from NEXTDC’s 29.2% investment in APDC, as well as $1.8m of costs related to the current APDC wind-up proposal 9 NEXTDC FY18 Results
Well capitalised for growth $371.6m $292.8m 30 June 2018 30 June 2017 ($m) ($m) Cash and term deposits 418.0 368.3 $62.5m $33.4m Property, plant, equipment 679.9 434.3 $418.0m – Investment in APDC 62.5 $368.3m Total assets 1,235.9 852.4 Interest-bearing liabilities 304.1 302.3 Total liabilities 341.9 345.9 Cash and term Cash flow Financing Investing Investment in Cash and term Net assets 894.0 506.5 1 2 deposits as at from activities activities APDC deposits as at 1 July 2017 operations 30 June 2018 ▪ Post 30 June 2018, NEXTDC raised an additional $300m in senior unsecured notes (Notes IV) in July 2018, bringing pro-forma cash and term deposits to $718m ▪ Strong banking support demonstrated through the upsize of the senior secured debt facility in August 2017 to $300m (previously $100m). This facility remains undrawn ▪ Together, this brings our total pro-forma liquidity to over $1bn in July 2018 1. Cash flows from financing activities include proceeds from equity and debt raisings, transaction costs relating to financing activities and finance lease payments 2. Excluding receipts for term deposits 10 NEXTDC FY18 Results
FY18 Full-Year Results BUSINESS PERFORMANCE
Strong growth in customers and connectivity Interconnection 1 Customers (number of cross connects) 8,671 972 772 6,342 647 4,575 478 2,893 302 1,488 132 513 FY13 FY14 FY15 FY16 FY17 FY18 FY13 FY14 FY15 FY16 FY17 FY18 ▪ Strong growth in interconnection drives average interconnects per customer to 8.9 (up 9%) at 30 June 2018 compared to 8.2 at 30 June 2017 ▪ Growth in average interconnects per customer highlights the increasing use of hybrid cloud and connectivity both inside and outside the data centre as customers expand their ecosystems ▪ Ecosystem growth is expected to drive higher margins and customer retention 1. Comprises both physical and elastic cross connections 12 NEXTDC FY18 Results
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