Interxion Holding NV (NYSE: INXN), a leading European provider
of carrier-neutral colocation data centre services, announced its
results today for the three months ended 30 September 2012.
Financial Highlights
- Revenue increased by 14% to €70.4
million (Q3 2011: €62.0 million)
- Adjusted EBITDA increased by 15% to
€28.7 million (Q3 2011: €25.0 million)
- Adjusted EBITDA margin increased to
40.8% (Q3 2011: 40.3%)
- Net profit increased by 24% to €8.6
million (Q3 2011: €6.9 million)
- Capital expenditure, including
intangible assets, was €46.5 million
Operating Highlights
- New data centres opened in Amsterdam
and London
- Equipped Space increased by 4,300
square metres in the third quarter to 69,600 square metres
- Revenue Generating Space increased by
2,600 square metres in the third quarter to 51,200 square
metres
- Utilisation Rate was 74% at the end of
the quarter
- Announced expansion projects remain on
schedule
“Interxion again delivered solid financial and operational
results and significantly grew both equipped and revenue generating
space,” said Interxion Chief Executive Officer, David Ruberg. “Our
market strategy that focuses on creating value for our customers by
building communities of interest continues to pay off. We saw
particular strength from cloud service providers and financial
services segments who derive value in their own businesses from the
rich, low latency connectivity and robust communities of interest
available in our highly reliable data centres.”
Quarterly Review
Revenue for the third quarter of 2012 was €70.4 million, a 14%
increase over the third quarter of 2011 and a 4% increase over the
second quarter of 2012. Recurring revenue was €65.1 million, a 12%
increase over the third quarter of 2011 and a 4% increase over the
second quarter of 2012. Recurring revenue was 92% of total
revenue.
Cost of sales for the third quarter increased by 13% to €29.4
million, compared with the third quarter of 2011. Gross profit
margin increased to 58.3%, compared with 58.1% in the same quarter
of 2011. Sales and marketing costs in the third quarter were €5.1
million, up 20% compared with the same quarter in the previous
year. General and administrative costs1, were €7.2 million, an
increase of 6% compared with the third quarter of 2011.
Depreciation, amortisation, and impairments increased by 21%,
compared with the previous-year third quarter, to €11.0
million.
Net financing costs for the third quarter of 2012 were €3.8
million, compared with €5.3 million in the third quarter of 2011,
primarily as a result of higher interest capitalization because of
increased data centre construction.
Net profit was €8.6 million in the third quarter of 2012, up 24%
from the third quarter of 2011. Earnings per share in the third
quarter of 2012 were €0.12, an increase of 21%, on a weighted
average of 68.7 million diluted shares compared to €0.10 on a
weighted average of 67.5 million diluted shares in the third
quarter of 2011.
Adjusted EBITDA for the third quarter of 2012 was €28.7 million,
up 15% year-on-year. Adjusted EBITDA margin expanded to 40.8%,
compared with 40.3% in the third quarter of the previous year.
Cash generated from operations, defined as cash generated from
operating activities before interest and corporate income tax
payments and receipts, was €24.1 million. Capital Expenditure,
including intangible assets, was €46.5 million in the third quarter
2012.
Cash and cash equivalents were €55.2 million at 30 September
2012, down from €142.7 million at year-end 2011. The Company’s
€60.0 million revolving credit facility remains undrawn.
Equipped space at the end of the third quarter 2012 was 69,600
square metres, compared with 62,200 square metres at the end of the
third quarter of 2011 and 65,300 square metres at the end of the
second quarter of 2012. Revenue generating space was 51,200 square
metres at the end of the third quarter 2012, compared to 46,100
square metres at the end of the third quarter of 2011 and 48,600
square metres at the end of the second quarter of 2012. Utilisation
rate, the ratio of revenue-generating space to equipped space, was
74% at the end of the quarter, the same as the third quarter of
2011 and the second quarter of 2012.
1 excluding depreciation, amortisation, impairments, increase in
provision for onerous lease contracts, and share-based payments
Business Outlook
The Company today reaffirmed its guidance for 2012:
Revenue €275 million – €285 million Adjusted EBITDA
€112 million – €120 million Capital Expenditure (including
intangibles) €170 million – €190 million
Conference Call to Discuss Results
The Company will host a conference call today at 8:30am ET
(1:30pm GMT, 2:30pm CET) to discuss the results.
To participate on this call, U.S. callers may dial toll free
1-866-295-3947; callers outside the U.S. may dial direct +44 (0)
1452 561 394. The conference ID for this call is 39820449. This
event also will be webcast live over the Internet in listen-only
mode at investors.interxion.com.
A replay of this call will be available shortly after the call
concludes and will be available until 14 November 2012. To
access the replay, U.S. callers may dial toll free 1-866-247-4222;
callers outside the U.S. may dial direct +44 (0) 1452 55 00 00. The
replay access number is 39820449.
Forward-looking Statements
This press release contains forward-looking statements that
involve risks and uncertainties. Actual results may differ
materially from expectations discussed in such forward-looking
statements. Factors that might cause such differences include, but
are not limited to, the difficulty of reducing operating expenses
in the short term, inability to utilise the capacity of newly
planned data centres and data centre expansions, significant
competition, the cost and supply of electrical power, data centre
industry over-capacity, performance under service-level agreements,
and other risks described from time to time in Interxion's filings
with the Securities and Exchange Commission. Interxion does not
assume any obligation to update the forward-looking information
contained in this press release.
Use of Non-IFRS Information
EBITDA is defined as operating profit plus depreciation,
amortization and impairment of assets. We define Adjusted EBITDA as
EBITDA adjusted to exclude share-based payments, increase/decrease
in provision for onerous lease contracts, IPO transaction costs,
and income from sub-leases on unused data centre sites. Adjusted
EBITDA margin is defined as Adjusted EBITDA as a percentage of
revenue. We present EBITDA, Adjusted EBITDA and Adjusted EBITDA
margin as additional information because we understand that they
are measures used by certain investors and because they are used in
our financial covenants in our €60 million revolving credit
facility and €260 million 9.50% Senior Secured Notes due 2017.
However, other companies may present EBITDA, Adjusted EBITDA and
Adjusted EBITDA margin differently than we do. EBITDA, Adjusted
EBITDA and Adjusted EBITDA margin are not measures of financial
performance under IFRS and should not be considered as an
alternative to operating profit or as a measure of liquidity or an
alternative to net income as indicators of our operating
performance or any other measure of performance derived in
accordance with IFRS.
A reconciliation from Operating Profit to EBITDA and Adjusted
EBITDA is provided in the Notes to Consolidated Income Statement:
Adjusted EBITDA reconciliation later in this press release.
Interxion does not provide forward-looking estimates of
Operating Profit, Depreciation, Amortisation, and Impairments,
Share-based Payments, or increase/decrease in provision for onerous
lease contracts, IPO transaction costs, abandoned transaction
costs, income from sub-leases on unused data centre sites and net
insurance compensation benefit, which it uses to reconcile to
Adjusted EBITDA. The Company is, therefore, unable to provide
reconciling information for Adjusted EBITDA.
About Interxion
Interxion (NYSE: INXN) is a leading provider of carrier-neutral
colocation data centre services in Europe, serving a wide range of
customers through 32 data centres in 11 European countries.
Interxion’s uniformly designed, energy-efficient data centres offer
customers extensive security and uptime for their mission-critical
applications. With connectivity provided by over 400 carriers and
ISPs and 18 European Internet exchanges across its footprint,
Interxion has created content and connectivity hubs that foster
growing customer communities of interest. For more information,
please visit www.interxion.com.
INTERXION HOLDING NV
CONSOLIDATED INCOME STATEMENT (in €'000 - except per share
data and where stated otherwise) (unaudited)
Three Months
Ended Nine Months Ended 30-Sep 30-Sep
30-Sep 30-Sep
2012 2011
2012 2011
Revenue 70,425 62,005 204,241
179,920 Cost of sales (29,400 ) (25,969 ) (84,129 ) (76,271
)
Gross profit 41,025 36,036 120,112
103,649 Other income 111 99 343 341 Sales and marketing
costs (5,083 ) (4,234 ) (14,597 ) (13,037 ) General and
administrative costs (19,443 ) (16,594 ) (55,457 ) (50,389 )
Operating profit 16,610 15,307 50,401
40,564 Net finance expense (3,778 ) (5,255 ) (12,089 )
(17,829 )
Profit before taxation 12,832 10,052
38,312 22,735 Income tax expense (4,270 ) (3,161 )
(12,330 ) (7,812 )
Net profit 8,562
6,891 25,982 14,923
Basic earnings per share: (€) 0.13 0.10 0.39 0.23 Diluted
earnings per share: (€) 0.12 0.10 0.38 0.23 Number of
shares outstanding at the end of the period (shares in thousands)
67,950 65,823 67,950 65,823 Weighted average number of shares for
Basic EPS (shares in thousands) 67,776 65,742 67,069 63,528
Weighted average number of shares for Diluted EPS (shares in
thousands) 68,659 67,488 67,936 65,223
Capacity
Metrics
Equipped space (in square meters) 69,600 62,200 69,600 62,200
Revenue generating space (in square meters) 51,200 46,100 51,200
46,100 Utilisation rate 74 % 74 % 74 % 74 %
INTERXION HOLDING NV NOTES TO CONSOLIDATED
INCOME STATEMENT: SEGMENT INFORMATION (in €'000 - except where
stated otherwise) (unaudited)
Three Months Ended
Nine Months Ended 30-Sep 30-Sep
30-Sep 30-Sep
2012 2011
2012 2011
Consolidated
Recurring revenue 65,101 58,225 190,247 168,611
Non-recurring Revenue 5,324 3,780 13,994
11,309
Revenue 70,425 62,005
204,241 179,920 Adjusted
EBITDA 28,726 25,005 83,828
70,536 Gross Margin 58.3
% 58.1 % 58.8 % 57.6
% Adjusted EBITDA Margin 40.8 %
40.3 % 41.0 % 39.2 %
Total assets 769,644 708,410 769,644 708,410 Total
liabilities 400,504 392,391 400,504 392,391 Capital expenditure,
including intangible assets (i) (46,468 ) (54,943 ) (150,140 )
(93,413 )
France, Germany,
Netherlands, and UK
Recurring revenue 39,828 34,470 116,287 100,276
Non-recurring Revenue 3,950 1,950 10,149 6,912
Revenue 43,778 36,420
126,436 107,188 Adjusted EBITDA
22,395 18,473 65,800
53,216 Gross Margin 60.1 %
59.9 % 60.9 % 59.0 %
Adjusted EBITDA Margin 51.2 % 50.7
% 52.0 % 49.6 % Total
assets 518,004 335,727 518,004 335,727 Total liabilities 90,654
86,705 90,654 86,705 Capital expenditure, including intangible
assets (i) (37,935 ) (41,008 ) (124,990 ) (62,827 )
Rest of
Europe
Recurring revenue 25,273 23,755 73,960 68,335 Non-recurring
Revenue 1,374 1,830 3,845 4,397
Revenue 26,647 25,585
77,805 72,732 Adjusted EBITDA
13,805 13,162 40,689
37,423 Gross Margin 60.8 %
60.7 % 61.2 % 60.9 %
Adjusted EBITDA Margin 51.8 % 51.4
% 52.3 % 51.5 % Total
assets 192,261 174,732 192,261 174,732 Total liabilities 41,141
38,812 41,141 38,812 Capital expenditure, including intangible
assets (i) (7,047 ) (13,650 ) (21,818 ) (28,453 )
Corporate and
Other
Adjusted EBITDA (7,474
) (6,630 ) (22,661 )
(20,103 ) Total assets 59,379 197,951 59,379
197,951 Total liabilities 268,709 266,874 268,709 266,874 Capital
expenditure, including intangible assets (i) (1,486 ) (285 ) (3,332
) (2,133 ) (i) Capital expenditure, including
intangible assets, represents payments to acquire property, plant
and equipment and intangible assets, as recorded in the
consolidated statement of cash flows as "Purchase of property,
plant and equipment" and "Purchase of intangible assets"
respectively.
INTERXION
HOLDING NV NOTES TO CONSOLIDATED INCOME STATEMENT: Adjusted
EBITDA reconciliation (in €'000 - except where stated
otherwise) (unaudited)
Three Months Ended Nine
Months Ended 30-Sep 30-Sep
30-Sep 30-Sep
2012 2011
2012 2011
Reconciliation to
adjusted EBITDA
Consolidated
Operating profit 16,610 15,307
50,401 40,564 Depreciation, amortization and
impairments 11,031 9,087 30,922 27,181
EBITDA 27,641 24,394 81,323
67,745 Share-based payments 1,196 710 2,848 1,389
Increase/(decrease) in provision for onerous lease contracts - - -
18 IPO transaction costs (ii) - - - 1,725 Income from sub-leases on
unused data center sites (111 ) (99 ) (343 ) (341 )
Adjusted
EBITDA 28,726 25,005 83,828
70,536
France, Germany,
Netherlands, and UK
Operating profit 15,798 13,385
48,011 37,300 Depreciation, amortization and
impairments 6,526 5,118 17,627 16,017
EBITDA 22,324 18,503 65,638
53,317 Share-based payments 182 69 505 222
Increase/(decrease) in provision for onerous lease contracts - - -
18 Income from sub-leases on unused data center sites (111 ) (99 )
(343 ) (341 )
Adjusted EBITDA 22,395
18,473 65,800 53,216
Rest of
Europe
Operating profit 9,796
9,681
28,977
27,533 Depreciation, amortization and impairments 3,904
3,411
11,393
9,698
EBITDA 13,700
13,092
40,370
37,231 Share-based payments 105
70
319
192
Adjusted EBITDA 13,805
13,162
40,689
37,423
Corporate and
Other
Operating Profit/(Loss) (8,984 )
(7,759 )
(26,587 )
(24,269 ) Depreciation, amortization and impairments
601
558
1,902
1,466
EBITDA (8,383 )
(7,201 )
(24,685 )
(22,803 ) Share-based payments 909
571
2,024
975 IPO transaction costs (ii) -
-
-
1,725
Adjusted EBITDA (7,474 )
(6,630 )
(22,661 )
(20,103 ) (ii) The IPO transaction costs
represent the write off of the proportion of the IPO costs
allocated to the selling shareholders at the Initial Public
Offering.
INTERXION HOLDING NV
CONSOLIDATED BALANCE SHEET (in €'000 - except where stated
otherwise) (unaudited)
As at 30-Sep 31-Dec
2012 2011
Non-current Assets Property, plant and
equipment 583,809 477,798 Intangible assets 18,162 12,542 Deferred
tax assets 32,394 39,557 Financial fixed assets 774 – Other
non-current assets 4,525 3,841
639,664
533,738 Current Assets Trade and other current assets
74,828 67,874 Cash and cash equivalents 55,152 142,669
129,980 210,543 Total
Assets 769,644 744,281
Shareholders’ Equity Share capital 6,796 6,613 Share premium
475,185 466,166 Foreign currency translation reserve 10,781 7,386
Accumulated deficit (123,622 ) (149,604 )
369,140
330,561 Non-current Liabilities Trade payables and
other liabilities 10,858 10,294 Deferred tax liabilities 2,722
1,742 Provision for onerous lease contracts 8,503 10,618 Borrowings
257,758 257,267
279,841 279,921
Current Liabilities Trade payables and other liabilities
113,799 127,639 Income tax liabilities 3,582 2,249 Provision for
onerous lease contracts 3,180 3,108 Borrowings 102 803
120,663 133,799 Total
Liabilities 400,504 413,720
Total Liabilities and Shareholders’ Equity 769,644
744,281 INTERXION
HOLDING NV NOTES TO THE CONSOLIDATED BALANCE SHEET:
BORROWINGS (in €'000 - except where stated otherwise)
(unaudited)
As at 30-Sep 31-Dec
2012
2011
Borrowings Net of
Cash and Cash Equivalents
Cash and Cash Equivalents (iii) 55,152
142,669 9.5% Senior Secured Notes due
2017 (iv) 256,090 255,560 Financial Leases 165 337 Other Borrowings
1,605 2,173
Borrowings Excluding Revolving Credit
Facility Deferred Financing Costs 257,860
258,070 Revolving credit facility deferred financing
costs (v) (1,452 ) (667 )
Total Borrowings 256,408
257,403 Borrowings Net of
Cash and Cash Equivalents 201,256 114,734
(iii) Cash and cash equivalents includes €5.6
million as of September 30, 2012 and €4.8 million as of December
31, 2011, which is restricted and held as collateral to support the
issuance of bank guarantees on behalf of a number of subsidiary
companies. (iv) €260 million 9.5% Senior Secured Notes due 2017
include premium on additional issue and are shown after deducting
underwriting discounts and commissions, offering fees and expenses.
(v) Deferred financing costs of €1.5 million incurred in connection
with the €60 million revolving credit facility, which is currently
undrawn.
INTERXION HOLDING
NV CONSOLIDATED STATEMENT OF CASH FLOWS (in €'000 -
except where stated otherwise) (unaudited)
Three Months
Ended Nine Months Ended 30-Sep 30-Sep
30-Sep 30-Sep
2012 2011
2012 2011
Profit for the period 8,562 6,891 25,982 14,923
Depreciation, amortization and impairments 11,031 9,087 30,922
27,181 IPO transaction costs - - - 1,725 Unwinding provision for
onerous lease contracts (793 ) (750 ) (2,372 ) (2,303 ) Share-based
payments 1,196 710 2,848 1,389 Net finance expense 3,778 5,255
12,089 17,829 Income tax expense 4,270 3,161 12,330
7,812 28,044 24,354 81,799 68,556 Movements in trade
and other current assets (3,291 ) (2,316 ) (7,076 ) (7,995 )
Movements in trade and other liabilities (687 ) 1,723 4,128
6,913
Cash Generated from Operations
24,066 23,761 78,851 67,474 Interest
paid (vi) (7,476 ) (11,598 ) (17,607 ) (24,178 ) Interest received
414 704 734 1,241 Income tax paid (1,320 ) (392 ) (3,622 ) (1,544 )
Net Cash Flows from Operating Activities 15,684
12,475 58,356 42,993 Cash Flows from
Investing Activities Purchase of property, plant and equipment
(43,823 ) (53,763 ) (145,046 ) (89,127 ) Disposals of property,
plant and equipment - - - 945 Purchase of intangible assets (2,645
) (1,180 ) (5,094 ) (4,286 ) Acquisition financial fixed assets - -
(774 ) - Movement in short-term investments - 50,000
- (40,000 )
Net Cash Flows from Investing Activities
(46,468 ) (4,943 ) (150,914
) (132,468 ) Cash Flows from Financing
Activities Proceeds from exercised options 1,621 698 6,725
3,022 Proceeds from issuance of new shares - - - 142,952 Repayment
of "Liquidation Price" to former preferred shareholders - - -
(3,055 ) Senior Secured Notes and RCF (204 ) - (1,159 ) (645 )
Other Borrowings (59 ) (678 ) (740 ) (2,265 )
Net Cash Flows
from Financing Activities 1,358 20 4,826
140,009 Effect of exchange rate changes on cash 92 16
215 (110 )
Net Movement in Cash and Cash
Equivalents (29,334 ) 7,568 (87,517
) 50,424 Cash and cash equivalents, beginning of
period 84,486 141,971 142,669 99,115
Cash and Cash Equivalents, End of Period 55,152
149,539 55,152 149,539
(vi) Interest paid is reported net of cash interest
capitalized which is reported as part of “Purchase of property,
plant and equipment".
INTERXION HOLDING NV
Status of Announced Expansion Projects as at 31 October 2012
with Target Open Dates in 2012 & 2013
Market Project CAPEX (a, b) Equipped
Space (a) Target Opening
(€ million) (Sqm) Stockholm STO 1:
Phase 4 Expansion € 5 500 1Q 2012 (opened) Frankfurt FRA 7: New
Build € 21 1,500 1Q 2012 (opened) Paris PAR 7 : Phase 1 New Build €
70 4,500 2Q 2012 (opened) (c) Amsterdam AMS 6: New Build € 60 4,400
3Q 2012 (opened) (d) London LON 2: New Build € 38 1,500 3Q 2012
(opened) (e) Amsterdam AMS 5: Phase 4 Expansion € 12 1,000 4Q 2012
Zurich ZUR 1: Phase 3 Expansion € 4 600 4Q 2012 Madrid MAD 2: Phase
1 New Build € 10 800 1Q 2013
Total € 220
14,800 (a) CAPEX and Equipped Space are approximate
and may change. (b) CAPEX reflects the total for the listed project
at full power and capacity and may not be all invested in the
current year. (c) Opened 500 sqm in 2Q 2012 and 1500 sqm in 3Q
2012; remaining 2500 sqm scheduled to open in 1Q 2013. (d) Opened
1700 sqm in 3Q 2012 for early customer access; remainder of the
facility opened on schedule (e) 1100 sqm opened in 3Q 2012;
remainder scheduled to open in 4Q 2012.
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