15% Full Year Revenue Growth
InterXion Holding NV (NYSE: INXN), a leading European provider
of carrier and cloud-neutral colocation data centre services,
announced its results today for the three months and full year
ended 31 December 2018.
Financial Highlights1
- Revenue for the fourth quarter and full
year increased by 13% and 15% to €146.9 million and €561.8 million,
respectively (4Q 2017: €129.9 million; FY 2017: €489.3
million).
- Recurring revenue1 for the fourth
quarter and full year increased by 13% and 15% to €139.7 million
and €533.1 million, respectively (4Q 2017: €123.4 million; FY 2017:
€462.5 million).
- Net income for the fourth quarter and
full year decreased by 18% and 20% to €8.0 million and €31.1
million, respectively (4Q 2017: €9.7 million; FY 2017: €39.1
million).
- Adjusted net income2 for the fourth
quarter decreased by 26% to €7.8 million (4Q 2017: €10.6 million)
and was flat for the full year compared to the prior year at €40.2
million.
- Diluted earnings per share for the
fourth quarter and full year were €0.11 and €0.43, respectively (4Q
2017: €0.14; FY 2017: €0.55).
- Adjusted diluted earnings2 per share
for the fourth quarter and full year were €0.11 and €0.56,
respectively (4Q 2017: €0.15; FY 2017: €0.56).
- Adjusted EBITDA2 for the fourth quarter
and full year increased by 15% and 17% to €67.7 million and €257.8
million, respectively (4Q 2017: €59.1 million; FY 2017: €221.0
million).
- Adjusted EBITDA margin for the fourth
quarter and full year was 46.1% and 45.9%, up 60 basis points and
up 70 basis points, respectively (4Q 2017: 45.5%; FY 2017:
45.2%).
- Capital expenditures, including
intangible assets3, were €131.3 million in the fourth quarter and
€451.2 million for full year (4Q 2017: €69.7 million; FY 2017:
€256.0 million).
___________________________
* As previously reported, certain comparative figures for the
three months and twelve months ended 31 December 2017 have been
restated compared to the amounts disclosed on Form 6-K furnished on
7 March 2018. For further details on the correction of this error,
see Note 2 and Note 29 of our 2017 Consolidated Financial
Statements included on Form 20-F, filed with the SEC on 30 April
2018.
Operating Highlights
- Equipped space4 increased by 4,500
square metres in the fourth quarter and 22,300 square metres in the
full year to 144,800 square metres.
- Revenue generating space4 increased by
3,800 square metres in the fourth quarter and 15,200 square metres
in the full year to 115,000 square metres.
- Utilisation rate was 79% at the end of
2018.
- During the fourth quarter 2018,
Interxion completed the following expansions:
- 2,700 sqm expansion in Amsterdam;
- 1,500 sqm expansion in Paris; and,
- 300 sqm expansion in Frankfurt.
"Our highly-connected data centres continue to attract strong
demand from all customer segments, resulting in solid booking
trends across our European footprint," said David Ruberg,
Interxion’s Chief Executive Officer. "The underlying drivers of
this growth are secular in nature, reflecting the widespread
adoption of digital technologies by consumers and enterprises
alike. The cloud and content platforms continue to lead the way,
which in turn, require larger infrastructure capacities for core
and edge deployments. We are still in the early stages of this
transformation and believe there is a substantial opportunity ahead
of us."
Quarterly Review
Revenue in the fourth quarter of 2018 was €146.9 million, a 13%
increase from the fourth quarter of 2017 and a 3% increase from the
third quarter of 2018. Recurring revenue was €139.7 million, a 13%
increase from the fourth quarter of 2017 and a 4% increase from the
third quarter of 2018. Recurring revenue in the fourth quarter
represented 95% of total revenue. On an organic constant currency5
basis, revenue in the fourth quarter of 2018 was 13% higher than in
the fourth quarter of 2017 and 3% higher than in the third quarter
of 2018.
Cost of sales in the fourth quarter of 2018 was €57.2 million, a
17% increase from the fourth quarter of 2017 and a 2% increase from
the third quarter of 2018.
Gross profit was €89.7 million in the fourth quarter of 2018, an
11% increase from the fourth quarter of 2017 and a 4% increase from
the third quarter of 2018. Gross profit margin was 61.1% in the
fourth quarter of 2018, compared to 62.4% in the fourth quarter of
2017 and 60.7% in the third quarter of 2018.
Sales and marketing costs in the fourth quarter of 2018 were
€9.5 million, a 5% increase from the fourth quarter of 2017 and a
9% increase from the third quarter of 2018.
General and administrative costs, excluding the items we adjust
for in the determination of Adjusted EBITDA, were €12.5 million in
the fourth quarter of 2018, a 3% decrease over the fourth quarter
of 2017 and a 6% increase from the third quarter of 2018.
Depreciation and amortisation in the fourth quarter of 2018 was
€34.3 million, an 18% increase from the fourth quarter of 2017 and
a 4% increase from the third quarter of 2018.
Operating income in the fourth quarter of 2018 was €31.0
million, a 20% increase from the fourth quarter of 2017 and a 15%
increase from the third quarter of 2018.
Net finance expense for the fourth quarter of 2018 was €15.8
million, a 28% increase from the fourth quarter of 2017 and a 34%
increase from the third quarter of 2018.
Income tax expense for the fourth quarter of 2018 was €7.3
million, a 98% increase compared to the fourth quarter of 2017 and
a 64% increase from the third quarter of 2018. While benefiting
from reductions in statutory corporate tax rates in a number of
countries of operation, there was an associated non-cash negative
impact to deferred tax assets. In the fourth quarter 2018, this
charge amounted to €2.4 million.
Net income was €8.0 million in the fourth quarter of 2018, an
18% decrease over the fourth quarter of 2017 and a 27% decrease
from the third quarter of 2018.
Adjusted net income was €7.8 million in the fourth quarter of
2018, a 26% decrease over the fourth quarter of 2017 and a 33%
decrease from the third quarter of 2018.
Adjusted EBITDA for the fourth quarter of 2018 was €67.7
million, a 15% increase from the fourth quarter of 2017 and a 3%
increase from the third quarter of 2018.
Adjusted EBITDA margin was 46.1% in the fourth quarter of 2018,
compared to 45.5% in the fourth quarter of 2017 and 46.3% in the
third quarter of 2018.
Net cash flows from operating activities were €44.8 million in
the fourth quarter of 2018, compared to €45.5 million in the fourth
quarter of 2017 and €53.9 million in the third quarter of 2018.
Cash generated from operations6 was €76.9 million in the fourth
quarter of 2018, compared to €50.3 million in the fourth quarter of
2017 and €60.9 million in the third quarter of 2018.
Capital expenditures, including intangible assets, were €131.3
million in the fourth quarter of 2018, compared to €69.7 million in
the fourth quarter of 2017 and €103.2 million in the third quarter
of 2018.
Cash and cash equivalents were €186.1 million at 31 December
2018, compared to €38.5 million at 31 December 2017.
Total borrowings, excluding revolving facility deferred
financing costs, were €1,287.9 million at 31 December 2018,
compared to €832.6 million at 31 December 2017. As at 31 December
2018 no amounts had been drawn under this facility. During the
first quarter of 2019, Interxion increased its unsecured revolving
credit facility by €100 million for total commitment of €300
million.
Equipped space at the end of the fourth quarter of 2018 was
144,800 square metres, compared to 122,500 square metres at the end
of the fourth quarter of 2017 and 140,300 square metres at the end
of the third quarter of 2018.
Revenue generating space at the end of the fourth quarter of
2018 was 115,000 square metres, compared to 99,800 square metres at
the end of the fourth quarter of 2017 and 111,200 square metres at
the end of the third quarter of 2018.
Utilisation rate, the ratio of revenue-generating space to
equipped space, was 79% at the end of the fourth quarter of 2018,
compared to 81% at the end of the fourth quarter of 2017 and 79% at
the end of the third quarter of 2018.
Annual Review
Revenue for 2018 was €561.8 million, a 15% increase compared to
2017. Recurring revenue for 2018 was €533.1 million, a 15% increase
compared to 2017, and accounted for 95% of total revenue in 2018,
consistent with 2017. On an organic constant currency basis,
revenue in 2018 was 15% higher than in 2017.
Gross profit was €342.3 million in 2018, a 15% increase compared
to 2017. Gross profit margin was 60.9% in 2018, a decrease of 20
bps compared to 2017.
Sales and marketing costs for 2018 were €36.5 million, a 9%
increase compared to 2017.
Adjusted EBITDA for 2018 was €257.8 million, a 17% increase
compared to 2017. Adjusted EBITDA margin for 2018 was 45.9%, an
increase of 70 bps compared to 2017.
Net income was €31.1 million in 2018, compared to €39.1 million
in 2017. Diluted earnings per share in 2018 were €0.43 on a
weighted average of 72.1 million shares, compared to €0.55 on a
weighted average of 71.5 million shares in 2017.
Adjusted net income was €40.2 million in both 2018 and 2017.
Adjusted diluted earnings per share were €0.56 on a weighted
average of 72.1 million shares, compared to €0.56 on a weighted
average of 71.5 million shares in 2017. A reconciliation from Net
income to Adjusted net income is provided in the tables attached to
this press release.
Cash generated from operations was €251.0 million in 2018, an
increase of 20% compared to 2017.
Capital expenditures, including intangible assets, were €451.2
million in 2018 compared to €256.0 million in 2017.
During 2018, Equipped space increased by 22,300 square metres,
and Revenue generating space increased by 15,200 square metres4.
Utilisation rate was 79% as of 31 December 2018, compared to 81% as
of 31 December 2017.
Expansions in Frankfurt and Zurich; Land Purchase in
Copenhagen
In response to continuing strong demand, Interxion is today
announcing that it will construct a new data centre in Zurich
(“ZUR2”) and expand its FRA15 data centre in Frankfurt. In
addition, Interxion has purchased land to expand its Copenhagen
campus.
In Zurich, ZUR2 will be built on land purchased in the fourth
quarter of 2018. It will be constructed in four phases delivering
6,600 square metres of equipped space and 12 MW of customer
available power when fully built out. The first phase of ZUR2 is
expected to provide 1,700 sqm and is scheduled to be completed in
the first quarter of 2020. The second phase is expected to provide
1,900 sqm and is scheduled to become available in the third quarter
of 2020. The capital expenditure associated with the full build of
ZUR2 and the associated land, is expected to be approximately €120
million.
In Frankfurt, Interxion will expand its FRA15 data centre by
constructing Phase 2 which will add an additional 2,600 square
metres of equipped space that is scheduled to open in the fourth
quarter of 2020. Capital expenditure associated with the first two
phases of FRA15 is expected to be approximately €137 million.
In Copenhagen, Interxion has expanded its land bank by
purchasing land adjacent to its existing data centres sufficient to
add capacity of approximately 15,000 square metres in equipped
space to the existing campus. The capital expenditure associated
with the Copenhagen land purchase was approximately €10
million.
Business Outlook
Interxion today is providing guidance for full year 2019:
2018
2018
2019 Guidance
(As Reported)
(IFRS16(a)(b) basis)
(IFRS 16(a))
Revenue €561.8 million €562.1 million €632 million – €647 million
Adjusted EBITDA €257.8 million €296.5 million €324 million – €334
million Capital expenditures (including intangibles) €451.2 million
€451.2 million €570 million – €600 million
(a) IFRS16 refers to the International Financial Reporting
Standard 16 - Leases, which the company adopted from 1 January
2019. Under IFRS16, operating leases will be recognized as right of
use assets and lease liabilities, and certain components of revenue
will be recognized as lease revenue.
(b) The 2018 results on an IFRS16 basis represent the Company’s
estimates as if IFRS16 had been adopted as of 1 January 2018. On
this basis, revenue for 2018 would have remained broadly unchanged
versus as reported. Adjusted EBITDA for 2018 increases by €38.7
million due to changes in the treatment of rent expenses. The 2018
results on an IFRS16 basis are being presented solely for
comparative purposes in the context of the Company’s 2019
guidance.
Conference Call to Discuss Results
Interxion will host a conference call today at 8:30 a.m. ET
(1:30 p.m. GMT, 2:30 p.m. CET) to discuss the results.
To participate on this call, U.S. callers may dial toll free
1-866-966-1396; callers outside the U.S. may dial direct +44 (0)
2071 928 000. The conference ID for this call is INXN. 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 19 March 2019. To access the
replay, U.S. callers may dial toll free 1-866-331-1332; callers
outside the U.S. may dial direct +44 (0) 3333 009 785. The replay
access number is 6137888.
Forward-looking Statements
This communication contains forward-looking statements that
involve risks and uncertainties. There can be no assurance that
such statements will prove to be accurate and actual results and
future events could differ materially from those anticipated in
such forward-looking statements. Factors that could cause actual
results and future events to differ materially from Interxion’s
expectations include, but are not limited to, the difficulty of
reducing operating expenses in the short term, the 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, delays in remediating the material
weakness in internal control over financial reporting and/or making
disclosure controls and procedures effective, certain other risks
detailed herein and other risks described from time to time in
Interxion’s filings with the United States Securities and Exchange
Commission (the “SEC”).
Interxion does not assume any obligation to update the
forward-looking information contained in this report.
Non-IFRS Financial Measures
Included in these materials are certain non-IFRS financial
measures, which are measures of our financial performance that are
not calculated and presented in accordance with IFRS, within the
meaning of applicable SEC rules. These measures are as follows: (i)
Adjusted EBITDA; (ii) Recurring revenue; (iii) Revenue on an
organic constant currency basis; (iv) Adjusted net income; (v)
Adjusted basic earnings per share; (vi) Adjusted diluted earnings
per share and (vii) Cash generated from operations.
Other companies may present Adjusted EBITDA, Recurring revenue,
Revenue on an organic constant currency basis, Adjusted net income,
Adjusted basic earnings per share, Adjusted diluted earnings per
share and Cash generated from operations differently than we do.
Each of these measures are not measures of financial performance
under IFRS and should not be considered as an alternative to
operating income or as a measure of liquidity or an alternative to
Profit for the period attributable to shareholders (“net income”)
as indicators of our operating performance or any other measure of
performance implemented in accordance with IFRS.
Adjusted EBITDA, Recurring revenue and Revenue on an organic
constant currency basis
We define Adjusted EBITDA as Operating income adjusted for the
following items, which may occur in any period, and which
management believes are not representative of our operating
performance:
- Depreciation and amortisation –
property, plant and equipment and intangible assets (except
goodwill) are depreciated on a straight-line basis over the
estimated useful life. We believe that these costs do not represent
our operating performance.
- Share-based payments – represents
primarily the fair value at the date of grant of employee equity
awards, which is recognised as an expense over the vesting period.
In certain cases, the fair value is redetermined for market
conditions at each reporting date, until the final date of grant is
achieved. We believe that this expense does not represent our
operating performance.
- Income or expense related to the
evaluation and execution of potential mergers or acquisitions
(“M&A”) – under IFRS, gains and losses associated with M&A
activity are recognised in the period in which such gains or losses
are incurred. We exclude these effects because we believe they are
not reflective of our on-going operating performance.
- Adjustments related to terminated and
unused data centre sites – these gains and losses relate to
historical leases entered into for certain brownfield sites, with
the intention of developing data centres, which were never
developed and for which management has no intention of developing
into data centres. We believe the impact of gains and losses
related to unused data centres are not reflective of our business
activities and our on-going operating performance.
In certain circumstances, we may also adjust for other items
that management believes are not representative of our current
on-going performance. Examples include: adjustments for the
cumulative effect of a change in accounting principle or estimate,
impairment losses, litigation gains and losses or windfall gains
and losses.
We define Recurring revenue as revenue incurred from colocation
and associated power charges, office space, amortised set-up fees,
cross-connects and certain recurring managed services (but
excluding any ad hoc managed services) provided by us directly or
through third parties, excluding rents received for the sublease of
unused sites.
We believe Adjusted EBITDA and Recurring revenue provide useful
supplemental information to investors regarding our on-going
operational performance. These measures help us and our investors
evaluate the on-going operating performance of the business after
removing the impact of our capital structure (primarily interest
expense) and our asset base (primarily depreciation and
amortisation). Management believes that the presentation of
Adjusted EBITDA, when combined with the primary IFRS presentation
of net income, provides a more complete analysis of our operating
performance. Management also believes the use of Adjusted EBITDA
facilitates comparisons between us and other data centre operators
(including other data centre operators that are REITs) and other
infrastructure-based businesses. Adjusted EBITDA is also a relevant
measure used in the financial covenants of our revolving credit
facility and our 4.75% Senior Notes due 2025.
A reconciliation from net income to Adjusted EBITDA is provided
in the tables attached to this press release. Adjusted EBITDA and
other key performance indicators may not be indicative of our
historical results of operations based on IFRS, nor are they meant
to be predictive of future results under IFRS.
We present organic constant currency information for revenue to
provide a framework for assessing how our underlying businesses
performed excluding the effect of acquisitions and foreign currency
rate fluctuations. For purposes of calculating revenue on an
organic constant currency basis, revenues from entities acquired
during the current and comparison periods are excluded. Also,
current and comparative prior period results for entities reporting
in currencies other than Euro are converted into Euro using the
average exchange rates from the prior period rather than the actual
exchange rates in effect during the current period.
We believe that revenue growth is a key indicator of how a
company is progressing from period to period and presenting organic
constant currency information for revenue provides useful
supplemental information to investors regarding our on-going
operational performance because it helps us and our investors
evaluate the on-going operating performance of the business after
removing the impact of acquisitions and currency exchange
rates.
Adjusted net income, Adjusted basic earnings per share and
Adjusted diluted earnings per share
We define Adjusted net income as net income adjusted for the
following items and the related income tax effect, which may occur
in any period, and which management believes are not reflective of
our operating performance:
- Income or expense related to the
evaluation and execution of potential mergers or acquisitions
(“M&A”) – under IFRS, gains and losses associated with M&A
activity are recognised in the period in which such gains or losses
are incurred. We exclude these effects because we believe they are
not reflective of our on-going operating performance.
- Adjustments related to provisions –
these adjustments are made for adjustments in provisions that are
not reflective of the on-going operating performance of Interxion.
These adjustments may include changes in provisions for onerous
lease contracts.
- Adjustments related to capitalised
interest – under IFRS, we are required to calculate and capitalise
interest allocated to the investment in data centres and exclude it
from net income. We believe that reversing the impact of
capitalised interest provides information about the impact of the
total interest costs and facilitates comparisons with other data
centre operators.
In certain circumstances, we may also adjust for other items
that management believes are not representative of our current
on-going performance. Examples include: adjustments for the
cumulative effect of a change in accounting principle or estimate,
impairment losses, litigation gains and losses or windfall gains
and losses.
Management believes that the exclusion of certain items listed
above provides useful supplemental information to net income to aid
investors in evaluating the operating performance of our business
and comparing our operating performance with other data centre
operators and infrastructure companies. We believe the presentation
of Adjusted net income, when combined with net income prepared in
accordance with IFRS, is beneficial to a complete understanding of
our performance. A reconciliation from reported net income to
Adjusted net income is provided in the tables attached to this
press release.
Adjusted basic earnings per share and Adjusted diluted earnings
per share amounts are determined on Adjusted net income.
Cash generated from operations
Cash generated from operations is defined as net cash flows from
operating activities, excluding interest and corporate income tax
payments and receipts. Management believes that the exclusion of
these items provides useful supplemental information to net cash
flows from operating activities to aid investors in evaluating the
cash generating performance of our business.
Management’s outlook for 2019 included in this press release
includes a range for expected Adjusted EBITDA, a non-IFRS financial
measure, which excludes items that management believes are not
representative of our operating performance. These items include,
but are not limited to, depreciation and amortisation, share-based
payments, income or expense related to the evaluation and execution
of potential mergers or acquisitions, adjustments related to
terminated and unused data centre sites, and other significant
items that currently cannot be predicted. The exact amount of these
items is not currently determinable but may be significant.
Accordingly, the company is unable to provide equivalent
reconciliations from the corresponding forward-looking IFRS
measures to expected Adjusted EBITDA.
About Interxion
Interxion (NYSE: INXN) is a leading provider of carrier and
cloud-neutral colocation data centre services in Europe, serving a
wide range of customers through 51 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 over 700 connectivity
providers, 21 European Internet exchanges, and most leading cloud
and digital media platforms across its footprint, Interxion has
created connectivity, cloud, content and finance hubs that foster
growing customer communities of interest. For more
information, please visit www.interxion.com.
1 Recurring revenue is revenue incurred from colocation and
associated power charges, office space, amortised set-up fees,
cross-connects and certain recurring managed services (but
excluding any ad hoc managed services) provided by us directly or
through third parties, excluding rents received for the sublease of
unused sites.
2 Adjusted net income (or ‘Adjusted diluted earnings’) and
Adjusted EBITDA are non-IFRS figures intended to adjust for certain
items and are not measures of financial performance under IFRS.
Complete definitions can be found in the “Non-IFRS Financial
Measures” section in this press release. Reconciliations of net
income to Adjusted EBITDA and net income to Adjusted net income can
be found in the financial tables later in this press release.
3 Capital expenditures, including intangible assets, represent
payments to acquire property, plant, 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.
4 Starting from the end of 1Q 2018, the number of square metres
includes 2,300 sqm of equipped space and 1,300 sqm of revenue
generating space from Interxion Science Park. The number of square
metres in 4Q 2017 excludes the impact of Interxion Science
Park.
5 We present organic constant currency information to provide a
framework for assessing how our underlying businesses performed
excluding the effect of acquisitions and foreign currency rate
fluctuations. For purposes of calculating Revenue on an organic
constant currency basis, revenues from entities acquired during the
current and comparison periods are excluded. Also, current and
comparative prior period results for entities reporting in
currencies other than Euro are converted into Euro using the
average exchange rates from the prior period rather than the actual
exchange rates in effect during the current period. The
reconciliation of total revenue growth to total revenue growth on
an organic constant currency basis, is as follows:
Three months ended 31 December 2018
Year-on-year
Sequential
Reported total revenue growth 13.1% 3.3% Add back: impact of
foreign currency translation 0.1% -0.1% Total revenue growth on an
organic constant currency basis 13.2% 3.2%
Year ended 31 December 2018
Year-on-year
Reported total revenue growth 14.8% Add back: impact of
foreign currency translation 0.6% Reverse: impact of acquired ISP
business -0.2% Total revenue growth on an organic constant currency
basis 15.2% Percentages may not add due to rounding
6 We define Cash generated from operations as net cash flows
from operating activities, excluding interest and fees paid,
interest received and income tax paid.
INTERXION HOLDING NV CONDENSED CONSOLIDATED INCOME
STATEMENTS (in €'000 ― except per share data and where stated
otherwise) (unaudited)
Three Months
Ended Year Ended Dec-31 Dec-31
Dec-31
Dec-31
2018 2017((a))
2018 2017((a))
Revenue 146,901 129,881 561,752
489,302 Cost of sales (57,213 ) (48,842 ) (219,462 )
(190,471 )
Gross Profit 89,688 81,039
342,290 298,831 Other income - 70 86 97 Sales and
marketing costs (9,475 ) (9,008 ) (36,494 ) (33,465 ) General and
administrative costs (49,199 ) (46,349 ) (194,646 ) (167,190 )
Operating income 31,014
25,752 111,236 98,273 Net finance expense
(15,753 ) (12,327 ) (61,784 ) (44,367 )
Profit before income taxes 15,261 13,425
49,452 53,906 Income tax expense (7,281 ) (3,681 )
(18,334 ) (14,839 )
Net income 7,980
9,744 31,118 39,067 Basic
earnings per share(b): (€) 0.11 0.14 0.43 0.55 Diluted earnings per
share(c): (€) 0.11 0.14 0.43 0.55 Number of shares
outstanding at the end of the period (shares in thousands) 71,708
71,415 71,708 71,415 Weighted average number of shares for Basic
EPS (shares in thousands) 71,694 71,343 71,562 71,089 Weighted
average number of shares for Diluted EPS (shares in thousands)
72,182 71,813 72,056 71,521
As at
Dec-31 Dec-31
Capacity metrics 2018 2017
Equipped space (in square meters)(d) 144,800 122,500 Revenue
generating space (in square meters)(d) 115,000 99,800 Utilisation
rate 79 % 81 %
(a) As previously reported, certain
comparative figures for the three months and twelve months ended 31
December 2017 have been restated compared to the amounts disclosed
on Form 6-K furnished on 7 March 2018. For further details, see
Note 2 and Note 29 of our 2017 Consolidated Financial Statements
included on Form 20-F, filed with the SEC on 30 April 2018.
(b) Basic earnings per share are
calculated as net income divided by the weighted average number of
shares for Basic EPS.
(c) Diluted earnings per share are
calculated as net income divided by the weighted average number of
shares for Diluted EPS.
(d) Starting from the end of 1Q 2018,
totals include 2,300 sqm of equipped space and 1,300 sqm of revenue
generating space from Interxion Science Park. 31 December 2017
excludes the impact of Interxion Science Park.
INTERXION HOLDING NV NOTES TO CONDENSED
CONSOLIDATED INCOME STATEMENTS: SEGMENT INFORMATION (in €'000 ―
except where stated otherwise) (unaudited)
Three Months Ended Year Ended Dec-31
Dec-31
Dec-31 Dec-31
2018 2017((a))
2018
2017((a))
Consolidated Recurring revenue
139,658 123,422 533,083 462,516 Non-recurring revenue 7,243
6,459 28,669 26,786
Revenue
146,901 129,881 561,752
489,302 Net income 7,980 9,744
31,118 39,067 Net income margin 5.4 % 7.5 % 5.5 % 8.0
%
Operating income 31,014 25,752
111,236 98,273 Operating income margin 21.1 % 19.8 %
19.8 % 20.1 %
Adjusted EBITDA 67,708
59,111 257,798 220,961
Gross profit margin 61.1 % 62.4
% 60.9 % 61.1 % Adjusted
EBITDA margin 46.1 % 45.5 %
45.9 % 45.2 % Total assets
2,262,554 1,702,071 2,262,554 1,702,071 Total liabilities(b)
1,629,134 1,112,410 1,629,134 1,112,410 Capital expenditure,
including intangible assets(c) (131,285 ) (69,659 ) (451,179 )
(256,015 )
France, Germany, the Netherlands, and
the UK Recurring revenue 92,743 81,611 352,692 302,346
Non-recurring revenue 4,553 3,941 17,616
16,291
Revenue 97,296 85,552
370,308 318,637 Operating income 29,546
28,164 117,860 101,120 Operating income margin
30.4 % 32.9 % 31.8 % 31.7 %
Adjusted EBITDA 52,582
48,121 203,796 174,818
Gross profit margin 61.2 % 64.4
% 61.8 % 62.4 % Adjusted
EBITDA margin 54.0 % 56.2 %
55.0 % 54.9 % Total assets
1,508,967 1,229,960 1,508,967 1,229,960 Total liabilities(b)
311,140 274,076 311,140 274,076 Capital expenditure, including
intangible assets(c) (85,399 ) (47,406 ) (318,595 ) (174,818 )
Rest of Europe Recurring revenue 46,915
41,811 180,391 160,170 Non-recurring revenue 2,690 2,518
11,053 10,495
Revenue 49,605
44,329 191,444 170,665
Operating income 20,826 18,453
77,057 69,919 Operating income margin 42.0 % 41.6 %
40.3 % 41.0 %
Adjusted EBITDA 30,221
26,056 113,653 99,665
Gross profit margin 68.4 % 66.7
% 66.8 % 66.1 % Adjusted
EBITDA margin 60.9 % 58.8 %
59.4 % 58.4 % Total assets
520,834 393,644 520,834 393,644 Total liabilities(b) 111,762 78,247
111,762 78,247 Capital expenditure, including intangible assets(c)
(40,577 ) (18,737 ) (113,775 ) (69,832 )
Corporate
and other Operating income (19,358
) (20,865 ) (83,681 )
(72,766 ) Adjusted EBITDA (15,095
) (15,066 ) (59,651 )
(53,522 ) Total assets 232,753 78,467 232,753
78,467 Total liabilities 1,206,232 760,087 1,206,232 760,087
Capital expenditure, including intangible assets(c) (5,309 ) (3,516
) (18,809 ) (11,365 )
(a) As previously reported, certain
comparative figures for the three months and twelve months ended 31
December 2017 have been restated compared to the amounts disclosed
on Form 6-K furnished on 7 March 2018. For further details, see
Note 2 and Note 29 of our 2017 Consolidated Financial Statements
included on Form 20-F, filed with the SEC on 30 April 2018.
(b) Certain comparative figures as at 31
December 2017 have been corrected compared to those presented in
our 2017 Consolidated Financial Statements included on Form 20-F,
filed with the SEC on 30 April 2018. For further details, see
section "Correction of 2017 balance sheet figures" in this press
release.
(c) Capital expenditure, including
intangible assets, represents payments to acquire property, plant
and equipment and intangible assets, as recorded in the condensed
consolidated statements of cash flows as "Purchase of property,
plant and equipment" and "Purchase of intangible assets",
respectively.
INTERXION HOLDING NV NOTES TO CONDENSED
CONSOLIDATED INCOME STATEMENTS: ADJUSTED EBITDA RECONCILIATION
(in €'000 ― except where stated otherwise) (unaudited)
Three Months Ended Year Ended
Dec-31 Dec-31
Dec-31 Dec-31
2018 2017((a))
2018 2017((a))
Reconciliation to
Adjusted EBITDA
Consolidated
Net income 7,980 9,744 31,118
39,067 Income tax expense 7,281 3,681 18,334
14,839
Profit before taxation 15,261
13,425 49,452 53,906 Net finance expense
15,753 12,327 61,784 44,367
Operating income 31,014 25,752 111,236
98,273 Depreciation and amortisation 34,318 29,069 128,954
108,252 Share-based payments 1,512 2,717 12,704 9,929 Income or
expense related to the evaluation and execution of potential
mergers or acquisitions: M&A transaction costs(b) 298 1,643
3,235 4,604 Re-assessment of indirect taxes(c) 566 - 1,755 - Items
related to sub-leases on unused data centre sites(d) - (70 )
(86 ) (97 )
Adjusted EBITDA(e)
67,708
59,111 257,798 220,961
France, Germany,
the Netherlands, and the UK
Operating income 29,546 28,164
117,860 101,120 Depreciation and amortisation 22,867
19,938 84,943 72,721 Share-based payments 169 89 1,079 1,074 Items
related to sub-leases on unused data centre sites(d) - (70 )
(86 ) (97 )
Adjusted EBITDA(e)
52,582
48,121 203,796 174,818
Rest of
Europe
Operating income 20,826 18,453
77,057 69,919 Depreciation and amortisation 8,735
7,544 33,964 29,365 Share-based payments 94 59 877 381
Re-assessment of indirect taxes(c) 566 - 1,755
-
Adjusted EBITDA(e)
30,221
26,056 113,653 99,665
Corporate and
Other
Operating income (19,358 )
(20,865 ) (83,681 ) (72,766
) Depreciation and amortisation 2,716 1,587 10,047 6,166
Share-based payments 1,249 2,569 10,748 8,474 Income or expense
related to the evaluation and execution of potential mergers or
acquisitions: M&A transaction costs(b) 298 1,643
3,235 4,604
Adjusted EBITDA(e)
(15,095
) (15,066 ) (59,651 )
(53,522 )
(a) As previously reported, certain
comparative figures for the three months and twelve months ended 31
December 2017 have been restated compared to the amounts disclosed
on Form 6-K furnished on 7 March 2018. For further details, see
Note 2 and Note 29 of our 2017 Consolidated Financial Statements
included on Form 20-F, filed with the SEC on 30 April 2018.
(b) “M&A transaction costs” are costs
associated with the evaluation, diligence and conclusion or
termination of merger or acquisition activity. These costs are
included in “General and administrative costs”.
(c) This re-assessment relates to years
prior to 2018 and is therefore not representative of our current
on-going business.
(d) “Items related to sub-leases on unused
data centre sites” represents the income on sub-lease of portions
of unused data centre sites to third parties. This income is
treated as “Other income”.
(e) “Adjusted EBITDA” is a non-IFRS
financial measure. See “Non-IFRS Financial Measures” for more
information, including why we believe Adjusted EBITDA is useful,
and the limitations on the use of Adjusted EBITDA.
INTERXION HOLDING NV CONDENSED CONSOLIDATED
BALANCE SHEET (in €'000 ― except where stated otherwise)
(unaudited)
As at Dec-31 Dec-31
2018 2017
Non-current assets Property, plant and
equipment 1,721,064 1,342,471 Intangible assets 64,331 60,593
Goodwill 38,900 38,900 Deferred tax assets 21,807 24,470 Other
investments 7,906 3,693 Other non-current assets 16,843 13,674
1,870,851 1,483,801 Current assets Trade
receivables and other current assets 205,613 179,786 Cash and cash
equivalents 186,090 38,484
391,703 218,270 Total
assets 2,262,554 1,702,071
Shareholders’ equity(a)(b) Share capital 7,170 7,141
Share premium(b) 553,425 539,448 Foreign currency translation
reserve(a) 3,541 4,180 Hedging reserve, net of tax (165) (169)
Accumulated profit(a)(b) 69,449 39,061
633,420
589,661 Non-current liabilities(a) Borrowings
1,266,813 724,052 Deferred tax liabilities(a) 16,875 19,778 Other
non-current liabilities(a) 34,054 23,671
1,317,742
767,501 Current liabilities(a) Trade payables
and other current liabilities(a) 280,877 229,912 Income tax
liabilities 7,185 6,237 Borrowings 23,330 108,760
311,392
344,909 Total liabilities(a) 1,629,134
1,112,410 Total liabilities and shareholders’ equity
2,262,554 1,702,071 (a) Certain comparative
figures as at 31 December 2017 have been corrected compared to
those presented in our
2017 Consolidated Financial Statements
included on Form 20-F, filed with the SEC on 30 April 2018. For
further
details on the correction of this error,
see section "Correction of 2017 balance sheet figures" in this
press release.
(b) As previously reported, certain comparative figures as at 31
December 2017 have been restated compared to
the amounts disclosed on Form 6-K
furnished on 7 March 2018. For further details on the correction of
this error,
see Note 2 and Note 29 of our 2017
Consolidated Financial Statements included on Form 20-F, filed with
the
SEC on 30 April 2018.
INTERXION HOLDING NV NOTES TO THE CONDENSED
CONSOLIDATED BALANCE SHEET: BORROWINGS (in €'000 ― except where
stated otherwise) (unaudited)
As at
Dec-31 Dec-31 2018 2017
Borrowings net of
cash and cash equivalents
Cash and cash equivalents 186,090
38,484 4.75% Senior Notes due 2025(a) 1,188,387 -
6.00% Senior Secured Notes due 2020(b) - 628,141 Mortgages 51,382
53,640 Financial leases 50,374 51,127 Borrowings under our
Revolving Facilities - 99,904
Borrowings excluding Revolving
Facility deferred financing costs 1,290,143
832,812 Revolving Facility deferred financing costs(c)
(2,266) (204)
Total borrowings 1,287,877
832,608 Borrowings net of cash and cash
equivalents 1,101,787 794,124 (a) €1,200
million 4.75% Senior Notes due 2025 include a premium on additional
issuances and are shown after deducting commissions, offering fees
and
expenses.
(b) €625 million 6.00% Senior Secured Notes due 2020 included a
premium on additional issuances and are shown after deducting
underwriting discounts
and commissions, offering fees and
expenses. The Senior Secured Notes were redeemed with a portion of
the proceeds from the June 2018 issuance
of the 4.75% Senior Notes due 2025.
(c) Deferred financing costs of €2.3 million as of 31 December 2018
were incurred in connection with the €200 million Senior Unsecured
Revolving Credit
Facility, entered into on 18 June 2018.
Deferred financing costs of €0.2 million as at 31 December 2017
were incurred in connection with the €100 million
Senior Secured Revolving Facility, which
was repaid in 2018.
INTERXION HOLDING NV CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS (in €'000 ― except where stated
otherwise) (unaudited)
Three Months
Ended Year Ended Dec-31 Dec-31
Dec-31
Dec-31
2018 2017(a)
2018 2017(a) Net
income
7,980 9,744 31,118 39,067
Depreciation and amortisation 34,318 29,069 128,954 108,252
Share-based payments 1,788 2,984 12,270 8,889 Net finance expense
15,753 12,327 61,784 44,367 Income tax expense 7,281 3,681 18,334
14,839 67,120 57,805 252,460 215,414 Movements in trade receivables
and other assets 6,598 (17,013) (13,647) (30,667) Movements in
trade payables and other liabilities 3,194 9,473 12,171 24,266
Cash generated from / (used in) operations 76,912
50,265 250,984 209,013 Interest and fees
paid(b) (27,157) (1,536) (69,005) (41,925) Interest received - 3 1
143 Income tax paid (4,954) (3,241) (17,126) (11,985)
Net cash
flows from / (used in) operating activities 44,801
45,491 164,854 155,246 Cash flows from /
(used in) investing activities Purchase of property, plant and
equipment (125,839) (67,198) (439,733) (247,228) Financial
investments - deposits (12,603) 13 (12,336) (324) Acquisition
Interxion Science Park B.V. - - - (77,517) Purchase of intangible
assets (5,446) (2,461) (11,446) (8,787) Loans provided (880) (423)
(2,988) (1,764)
Net cash flows from / (used in) investing
activities (144,768) (70,069) (466,503)
(335,620) Cash flows from / (used in) financing
activities Proceeds from exercised options 218 199 1,736 6,969
Proceeds from mortgages - 9,950 5,969 9,950 Repayment of mortgages
(2,291) (8,804) (8,335) (10,848) Proceeds from revolving credit
facilities - 24,746 148,814 129,521 Repayment of revolving
facilities - - (250,724) (30,000) Proceeds 4.75% Senior Notes - -
1,194,800 - Financial lease obligation (1,170) (995) (1,170) (995)
Repayment 6.00% Senior Secured Notes - - (634,375) - Interest
received at issuance of additional notes - - 2,428 - Transaction
costs 4.75% Senior Notes (426) - (7,122) - Transaction costs 2018
revolving credit facility 20 - (2,542) -
Net cash flows from /
(used in) financing activities (3,649) 25,096
449,479 104,597 Effect of exchange rate changes on
cash (154) (238) (224) (1,632)
Net increase / (decrease) in cash
and cash equivalents (103,770) 280 147,606
(77,409) Cash and cash equivalents, beginning of period
289,860 38,204 38,484 115,893
Cash and cash equivalents, end of
period 186,090 38,484 186,090
38,484 (a) As previously reported, certain
comparative figures for the three months and twelve months ended 31
December 2017 have been restated compared to the
amounts disclosed on Form 6-K furnished on
7 March 2018. For further details, see Note 2 and Note 29 of our
2017 Consolidated Financial Statements
included on Form 20-F, filed with the SEC
on 30 April 2018.
(b) Interest and fees paid is reported net of cash interest
capitalised, which is reported as part of “Purchase of property,
plant and equipment".
INTERXION HOLDING NV
NOTES TO CONDENSED CONSOLIDATED INCOME STATEMENTS: ADJUSTED NET
INCOME RECONCILIATION (in €'000 ― except per share data and
where stated otherwise) (unaudited)
Three Months Ended Year Ended Dec-31 Dec-31
Dec-31 Dec-31
2018 2017((a))
2018 2017((a))
Net income - as reported 7,980
9,744 31,118 39,067 Add back +
Charges related to termination of financing arrangements(b) - -
11,171 - + Re-assessment of indirect taxes(c) 762 - 2,494 - +
M&A transaction costs 298 1,643 3,235
4,604 1,060 1,643 16,900 4,604
Reverse - Interest
capitalised (1,280 ) (452 ) (4,886 ) (3,057 ) (1,280 ) (452 )
(4,886 ) (3,057 )
Tax effect of above add backs &
reversals 78 (298 ) (2,929 ) (387 )
Adjusted net income 7,838 10,637
40,203 40,227 Reported basic
EPS: (€) 0.11 0.14 0.43 0.55 Reported diluted EPS: (€) 0.11 0.14
0.43 0.55 Adjusted basic EPS: (€) 0.11 0.15 0.56 0.57
Adjusted diluted EPS: (€) 0.11 0.15 0.56 0.56 (a) As
previously reported, certain comparative figures for the three
months and twelve months ended 31 December 2017 have been restated
compared to the
amounts disclosed on Form 6-K furnished on
7 March 2018. For further details, see Note 2 and Note 29 of our
2017 Consolidated Financial Statements
included on Form 20-F, filed with the SEC
on 30 April 2018.
(b) These charges relate to the repayment of our 6.00% Senior
Secured Notes due 2020 and the termination of our revolving credit
facility agreements in
2Q18.
(c) This re-assessment relates to years prior to 2018 and is
therefore not representative of our current on-going business.
Correction of 2017 balance sheet figures
During the implementation of IFRS 16 – Leases we identified that
for a limited number of data centre leases entered into since 2000,
with fixed or minimum annual indexation, the lease costs recognised
in prior periods had not been recognised in accordance with IAS 17
– Leases. IAS 17 requires that total minimum lease costs be
recognised on a straight-line basis over the term of the relevant
lease. The identified error relates to the timing of the
recognition of lease costs in the period since 2000 and does not
result in an increase in the total costs recognised over the term
of the relevant leases nor does it impact cash flows. While
the impact of error was inconsequential to and has therefore not
been adjusted in the 2017 Income Statement, certain comparative
balance sheet figures as at 31 December 2017 have been corrected to
reflect the cumulative impact of this error as follows:
As at December 31, 2017
As previouslyreported
Adjustments As corrected Total liabilities and
shareholders' equity 1,702,071 - 1,702,071
Other non-current liabilities 15,080 8,591 23,671 Deferred tax
liability 21,336 (1,558) 19,778 Trade payables and other current
liabilities 229,878 34 229,912
Total liabilities
1,105,343 7,067 1,112,410 Foreign currency
translation reserve 2,948 1,232 4,180 Accumulated profit/(deficit)
47,360 (8,299) 39,061
Total shareholders' equity
596,728 (7,067) 589,661 As at
December 31, 2017
As previouslyreported
Adjustments As corrected Total liabilities
Consolidated
1,105,343 7,067 1,112,410 France, Germany, The Netherlands and the
UK 267,751 6,325 274,076 Rest of Europe 77,505 742 78,247
INTERXION HOLDING NV Status of Announced Expansion
Projects as at 6 March 2019 with Target Open Dates after 30
September 2018 CAPEX
(a)(b) Equipped Space (a) Market
Project (€ million) (sqm)
Schedule Amsterdam AMS8: Phases 3 - 6 63 5,400 3Q
2018 - 4Q 2018 (c) Amsterdam AMS10: Phases 1 - 3 195 9,500 4Q 2019
- 3Q 2020 (d) Copenhagen CPH2: Phases 3 - 5 18 1,500 2Q 2018 - 3Q
2019 (e) Dusseldorf DUS2: Phase 3 5 500 2Q 2019 Frankfurt FRA6:
Phase 6 5 400 3Q 2018 - 4Q 2018 (f) Frankfurt FRA13: Phases 1 - 2
New Build 90 4,900 3Q 2018 - 1Q 2019 (g) Frankfurt FRA14: Phases 1
- 2 New Build 76 4,600 3Q 2019 - 4Q 2019 (h) Frankfurt FRA15:
Phases 1 - 2 New Build 137 4,900 2Q 2020 - 4Q 2020 (i) London LON3:
New Build 35 1,800 1Q 2019 - 3Q 2019 (j) Madrid MAD3: New Build 44
2,500 2Q 2019 (k) Marseille MRS2: Phase 2 - 4 72 4,200 2Q 2018 - 3Q
2019 (l) Marseille MRS3: Phase 1 New Build 79 2,300 4Q 2019 Paris
PAR7.2: Phase B (cont.) - C 47 2,500 2Q 2018 -1Q 2019 (m) Stockholm
STO5: Phases 2 - 3 19 1,200 1Q 2018 - 2Q 2019 (n) Vienna VIE2:
Phase 7 - 9 94 4,300 4Q 2017 - 2Q 2019 (o) Zurich ZUR1: Phase 6 10
300 2Q 2019 Zurich ZUR2: Phase 1 - 2 New Build 93 3,600 1Q 2020 -
3Q 2020 (p)
Total 1,082 54,400
(a) CAPEX and Equipped space are approximate and may change. SQM
figures are rounded to nearest 100 sqm unless otherwise noted, and
totals may not add due to rounding. (b) CAPEX reflects the total
spend for the projects listed at full power and capacity and the
amounts shown in the table above may be invested over time. (c)
AMS8: Phases 3 and 4 (2,800 sqm) opened in 3Q 2018 and phases 5 and
6 (1,300 sqm each) opened in 4Q 2018. (d) AMS10: Phase 1 (2,700
sqm) is scheduled to open in 4Q 2019; phase 2 (4,100 sqm) is
scheduled to open in 1Q 2020, phase 3 (2,700 sqm) is scheduled to
open in 3Q 2020. (e) CPH2: Phases 3 and 4 (900 sqm total) opened in
2Q 2018; phase 5 (600 sqm) is scheduled to open in 3Q 2019. (f)
FRA6: Phase 6 part (200 sqm) opened in 3Q 2018, the remaining 200
sqm opened in 4Q 2018. (g) FRA13: Phase 1 (2,300 sqm) opened in 3Q
2018; phase 2 (2,600 square metres) is scheduled to open in 1Q
2019. (h) FRA14: Phase 1 (2,400 sqm) is scheduled to open in 3Q
2019 and phase 2 (2,200 square metres) is scheduled to open in 4Q
2019. (i) FRA15: Phase 1 (2,300 sqm) is scheduled to open in 2Q
2020 and phase 2 (2,600 sqm) is scheduled to open in 4Q 2020. (j)
LON3: Phase 1 (300 sqm) is scheduled to open in 1Q 2019, phase 2
(600 sqm) is scheduled to open in 2Q 2019 and phase 3 (900 sqm) is
scheduled to open in 3Q 2019. (k) MAD3: Capex total for MAD3
include land purchase price. (l) MRS2: Phase 2 (700 sqm) opened in
2Q 2018 and 3Q; phase 3 (1,100 sqm) is scheduled to open in 1Q 2019
and phase 4 (2,500 sqm) is scheduled to open in 3Q 2019. (m)
PAR7.2: Phase B (cont.) (500 sqm) opened in 2Q 2018; Phase C part
(1,500 sqm) opened in 4Q 2018 and the remaining part (500 sqm) is
scheduled to open in 1Q 2019. (n) STO5: Phases 2-3 - 100 sqm opened
in 1Q 2018; 300 sqm became operational in 2Q 2018; 800 sqm is
scheduled to open in 2Q 2019. (o) VIE2: 2,300 sqm opened in 4Q 2017
through 3Q 2018; remaining 2,000 sqms are scheduled to open in 2Q
2019. (p) ZUR2: Phase 1 (1,700 sqm) is scheduled to open in 1Q 2020
and phase 2 (1,900 sqm) is scheduled to open in 3Q 2020.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190306005365/en/
InterxionJim HusebyInvestor RelationsTel:
+1-813-644-9399IR@interxion.com
InterXion Holding NV (NYSE:INXN)
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