DuPont Fabros Technology, Inc. Reports Second Quarter 2015 Results

Revenues increase 12%, AFFO per share increases 13%

Midpoint of Normalized FFO guidance increases $0.03 per share and AFFO increases $0.05 per share

SC1 Phase IIB and CH2 Phase I placed into service

WASHINGTON, July 30, 2015 /PRNewswire/ -- DuPont Fabros Technology, Inc. DFT is reporting results for the quarter ended June 30, 2015.  All per share results are reported on a fully diluted basis.

Highlights

  • As of July 30, 2015, our operating portfolio excluding the newly opened CH2 Phase I was 96% leased and commenced as measured by computer room square feet ("CRSF") and critical load (in megawatts, or "MW").
  • Quarterly Highlights, all previously reported other than one lease extension:
    • Signed five leases totaling 12.26 MW and 67,561 CRSF.
    • Extended three leases totaling 7.91 MW and 47,120 CRSF.
    • Placed SC1 Phase IIB into service 100% leased, totaling 9.1 MW and 42,000 CRSF.
    • Issued $250 million 8-year, 5.625% Senior Notes at 99.205%.
  • Subsequent to the second quarter 2015:
    • Placed CH2 Phase I into service 20% leased, totaling 7.1 MW and 45,000 CRSF.
    • Increased capacity under the Line of Credit from $560 million to $700 million. There are currently no borrowings under the Line of Credit.

Christopher Eldredge, President and Chief Executive Officer, said, "I am very proud of the leases executed in the second quarter, which totaled over 12 megawatts of critical load.  Also, we have placed over 16 megawatts of new capacity into service since the end of the first quarter.  All indications are that demand for our wholesale product will remain strong."

Second Quarter 2015 Results

For the quarter ended June 30, 2015, earnings were $0.30 per share compared to $0.32 per share for the second quarter of 2014.  As anticipated in our prior guidance, the current quarter was negatively impacted by a customer who filed for bankruptcy, resulting in $0.03 per share of revenue not being recognized and $0.03 of non-cash write-offs of straight-line receivables, intangible assets and leasing commissions due to this customer rejecting its leases. Excluding these items, earnings per share for second quarter 2015 increased $0.04 per share, or 13%.  Revenues increased 12%, or $11.9 million, to $113.8 million for the second quarter of 2015 over the second quarter of 2014.  The increase in revenues was primarily due to new leases commencing, an increase in a la carte project revenue and an increase in recoveries from customers due to higher real estate taxes, partially offset by the impact of the customer in bankruptcy noted above.

Normalized FFO for the quarter ended June 30, 2015 was $0.62 per share compared to $0.61 per share for the second quarter of 2014. Normalized FFO increased $0.01 per share, or 2%, 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,
  • Write-off of $0.02 per share of straight-line receivables and intangible assets related to the bankrupt customer, and
  • Increased interest expense of $0.02 per share due to a higher level of outstanding debt related to development financing.

Adjusted FFO ("AFFO") for the quarter ended June 30, 2015 was $0.70 per share compared to $0.62 per share in the second quarter of 2014. AFFO increased $0.08 per share, or 13% from the prior year. The increase was primarily due to the following:

  • Increased Normalized FFO of $0.01 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 $0.04 per share,
  • Add-back of non-cash write-offs of straight-line receivables and intangible assets of $0.02 per share, and
  • Decreased capitalized leasing commissions of $0.01 per share.

The customer for which we increased our bad debt reserve in the fourth quarter of 2014 filed for bankruptcy protection on February 23, 2015.  This customer did not pay the base rent owed to us in January and February, but did pay for operating expenses, direct electric and management fees in these months.  Post-bankruptcy filing, we received full rent payments for March through June totaling $5.1 million.  We did not recognize the base rent portions of these payments as revenue, but instead applied them to the straight-line rent receivables balance that we had on our books for this customer. At the time of the bankruptcy filing, this customer had the following leases with us:

Property


MW leased


CRSF Leased

ACC4


2.28



10,800


ACC5


0.40



1,930


NJ1 Phase I


2.28



11,000


VA3


1.30



15,122


Total


6.26



38,852


 

Effective July 1, 2015, this customer was deemed to have rejected each of its four leases with us.  Consequently, in the second quarter 2015, we wrote-off a portion of straight-line receivables and all of the intangible asset and leasing commissions related to this customer, which totaled $0.03 per share.  The remaining straight-line receivable balance as of July 29, 2015 is $0.9 million, which we believe will be recovered via a revenue sharing arrangement with this customer approved by the bankruptcy court, which allows this customer to occupy the leased space in our data centers while they work to negotiate a sale or vacate the space if such a sale does not materialize.  As of July 29, 2015, we have received $0.8 million from this arrangement.

We also have a $6.5 million note receivable from this customer, 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 Half 2015 Results

For the six months ended June 30, 2015, earnings were $0.53 per share compared to $0.63 per share for the first half of 2014.  The first half of 2015 was negatively impacted by the customer who filed for bankruptcy, resulting in $0.06 per share of revenue not being recognized and $0.03 of non-cash write-offs when this customer rejected its leases. Also, we recognized a $0.07 per share charge for the severance expense and equity accelerations associated with the departure of our former CEO. Excluding these items, earnings per share for the six months ended June 30, 2015 increased $0.06 per share, or 10%.  Revenues increased 8%, or $17.1 million, to $221.1 million for the first half of 2015 compared to the first half 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 six months ended June 30, 2015 was $1.23 per share compared to $1.20 per share for the first half of 2014.  Normalized FFO adds back the $0.07 per share recognized in the first half of 2015 for the severance expense and equity accelerations noted above.  Normalized FFO increased $0.03 per share, or 3%, from the prior year period primarily due to the following:

  • Increased operating income excluding depreciation of $0.13 per share which excludes the negative impact from the bankrupt customer, partially offset by
  • Revenue of $0.06 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 $0.02 per share due to a higher level of outstanding debt related to development financing.

AFFO for the six months ended June 30, 2015 was $1.35 per share compared to $1.24 per share in the first half of 2014.  AFFO increased $0.11 per share, or 9% from the prior year.  The increase was primarily due to the following:

  • Increased Normalized FFO of $0.03 per share,
  • Increased add-back of straight-line revenue as a result rent received from bankrupt customer not recognized as revenue and increased cash rents totaling $0.08 per share,
  • Add-back of non-cash write-offs of straight-line receivables and intangible assets of $0.02 per share, partially offset by
  • Increased capitalized leasing commissions of $0.01 per share, and
  • Lower stock compensation expense add-back of $0.01 per share.

Portfolio Update

During the second quarter 2015, we:

  • Signed five leases with a weighted average lease term of 7.1 years totaling 12.26 MW and 67,561 CRSF.
    • Three of these leases were with one customer at ACC7 totaling 7.43 MW and 42,822 CRSF. Two of the leases were in Phase I (4.46 MW) which commenced in the second quarter of 2015 and one pre-lease is in Phase II (2.97 MW) which is projected to commence in the fourth quarter of 2015 upon the opening of Phase II.
    • One lease was at SC1 Phase IIB totaling 3.41 MW and 15,853 CRSF. This lease commenced in the second quarter of 2015.
    • One pre-lease was at CH2 Phase I totaling 1.42 MW and 8,886 CRSF. This lease commenced in the third quarter of 2015 upon the opening of CH2 Phase I.
  • Commenced six leases totaling 15.56 MW and 75,474 CRSF.
  • Extended three leases with two customers totaling 7.91 MW and 47,120 CRSF by an average of 1.5 years.
    • One customer extended a lease at ACC4 and a lease at ACC6 totaling 6.61 MW and 32,800 CRSF by an average of 0.8 years. Compared to the rates in effect at the time of renewal, cash base rents will be an average of 12.6% higher upon the expiration of the original lease terms. GAAP base rents will be an average of 3.7% higher immediately. The same customer was given the right to individually decrease the term of the lease of each of nine computer rooms at ACC5, each with 2.28 MW of available critical load provided the aggregate reduction in lease terms does not exceed 67 months, or an average of approximately seven months per computer room. This right does not impact cash base rents, but GAAP rents will be an average of 6.1% lower immediately.
    • Another customer extended a lease at VA3 totaling 1.30 MW and 14,320 CRSF that was scheduled to expire in 2016. This lease was extended by 5.0 years and is now scheduled to expire in 2021. Cash base rents are not changed, but GAAP rents will be an average of 10.5% lower immediately due to an increase in the amortization term of the below market lease liability.

Subsequent to the second quarter, 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.

Year to date, we:

  • Signed seven leases with a weighted average lease term of 7.1 years totaling 14.46 MW and 76,600 CRSF that are expected to generate approximately $16.5 million of annualized GAAP base rent revenue which is equivalent to a GAAP rate of $95 per kW per month.
  • Commenced nine leases totaling 18.32 MW and 90,720 CRSF.
  • Extended the maturity of five leases totaling 10.18 MW and 57,920 CRSF by a weighted average of 2.7 years. Compared to the rates in effect when the extension was executed, cash base rents will be an average of 7.7% higher upon the expiration of the original lease terms. GAAP base rents will be an average of 4.0% higher immediately.

Development Update

We placed SC1 Phase IIB (9.1 MW) into service on May 1, 2015, 100% leased and commenced.  We placed CH2 Phase I (7.1 MW) into service on July 1, 2015, 20% leased and commenced.  We are currently developing ACC7 Phase II (8.9 MW) and ACC7 Phase III (11.9 MW) and CH2 Phase II (5.7 MW).  We anticipate that ACC7 Phase II, which is 33% pre-leased, will be placed into service in the fourth quarter of 2015 and that ACC7 Phase III and CH2 Phase II will be placed into service in the second quarter of 2016.

Balance Sheet and Liquidity

We issued $250 million of Unsecured Notes for eight years at a rate of 5.625% and a price of 99.205%.  $180 million of the proceeds were used to pay down the line of credit, and the remainder will be used to fund future data center development.

We increased the size 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 July 30, 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 quarter of 2015.  There is $88.1 million remaining under this program for the remainder of 2015.

Dividend

Our second quarter 2015 dividend of $0.42 per share was paid on July 15, 2015.  Our third quarter 2015 dividend of $0.42 was declared on July 27, 2015 and will be 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 64% at the midpoint of our current 2015 guidance.

Third 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 $2.38 to $2.48 per share compared to last quarter's range of $2.30 to $2.50 per share.  The increase in the mid-point is due to the following:

  • $0.03 per share from positive leasing and ala carte results,
  • $0.01 per share from lower interest expense due to increased capitalized interest,
  • $0.01 per share from the bankrupt customer, partially offset by
  • $0.02 per share second quarter write-off of straight-line receivables and intangible assets related to the bankrupt customer.

Key assumptions included in this guidance are:

  • The low end of the range assumes no additional revenue from the computer rooms that were leased by the bankrupt customer. The high end of the range assumes $0.02 of revenue from the revenue sharing agreement we have entered into with the bankrupt customer.
  • The low end of this range assumes no new leases commencing other than the ACC7 Phase II pre-lease. The high end of the range includes an additional $0.04 of revenue from new lease commencements.
  • The low end of the range assumes that ACC2 is not re-leased at the end of Yahoo's lease term, which is September 30, 2015, and remains vacant for the remainder of 2015. The current Yahoo! lease generates $0.05 of GAAP revenue per quarter. The high end of the range assumes $0.04 of revenue in the fourth quarter from the re-leasing of this space.

Our Normalized FFO guidance range is $0.59 to $0.62 per share for the third quarter of 2015.  The mid-point of this range is $0.01 lower than Normalized FFO per share in the second quarter of 2015.  This is due to the following:

  • $0.05 per share of increased interest expense due higher debt levels for the funding of our developments, increased average interest rate after issuing our new bonds and lower capitalized interest after placing CH2 Phase I into service, partially offset by
  • $0.02 per share of increased operating income excluding depreciation from new lease commencements, and
  • $0.02 per share of second quarter write-offs related to the bankrupt customer that are not forecasted in the third quarter.

We increased the mid-point of our 2015 AFFO guidance range by $0.05 per share.  The new range is $2.56 to $2.66 per share compared to last quarter's range of $2.46 to $2.66 per share.  This is due to the following:

  • Increased Normalized FFO of $0.03 per share, and
  • Forecasted revenue sharing rent from the bankrupt customer in July and August of $0.02 per share. This is forecasted to be applied to the straight-line receivable which increases the add-back to AFFO.

Our AFFO guidance range is $0.63 to $0.67 per share for the third quarter of 2015.  The mid-point of the range is $0.05 per share lower than second quarter 2015 AFFO per share.  This is due to following:

  • Decrease in mid-point of Normalized FFO of $0.01 per share,
  • Add-backs of second quarter write-offs of $0.02 per share related to the bankrupt customer that are not forecasted in the third quarter, and
  • Increased improvements to real estate of $0.02 per share.

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

Second Quarter 2015 Conference Call and Webcast Information

We will host a conference call to discuss these results today, Thursday, July 30, 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. 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 256 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 and failure to negotiate leases on terms that will enable us to achieve our expected returns, 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 report on Form 10-Q for the quarter ended 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 June 30,


Six months ended June 30,


2015


2014


2015


2014









Revenues:








Base rent

$

72,702



$

70,455



$

144,275



$

139,659


Recoveries from tenants

34,482



29,964



67,787



61,653


Other revenues

6,642



1,531



9,078



2,725


Total revenues

113,826



101,950



221,140



204,037


Expenses:








Property operating costs

29,660



27,782



61,153



57,877


Real estate taxes and insurance

7,063



3,411



11,039



6,878


Depreciation and amortization

26,185



23,603



51,212



46,872


General and administrative

4,468



3,868



8,811



8,108


Other expenses

5,552



1,599



12,805



2,472


Total expenses

72,928



60,263



145,020



122,207


Operating income

40,898



41,687



76,120



81,830


Interest income

30



39



41



107


Interest:








Expense incurred

(9,093)



(7,707)



(17,351)



(15,531)


Amortization of deferred financing costs

(694)



(723)



(1,336)



(1,466)


Loss on early extinguishment of debt



(338)





(338)


Net income

31,141



32,958



57,474



64,602


Net income attributable to redeemable noncontrolling interests –

operating partnership

(4,662)



(5,026)



(8,381)



(9,814)


Net income attributable to controlling interests

26,479



27,932



49,093



54,788


Preferred stock dividends

(6,811)



(6,811)



(13,622)



(13,622)


Net income attributable to common shares

$

19,668



$

21,121



$

35,471



$

41,166


Earnings per share – basic:








Net income attributable to common shares

$

0.30



$

0.32



$

0.54



$

0.63


Weighted average common shares outstanding

65,030,132



65,486,202



65,266,766



65,417,615


Earnings per share – diluted:








Net income attributable to common shares

$

0.30



$

0.32



$

0.53



$

0.63


Weighted average common shares outstanding

65,743,874



65,951,113



66,098,759



65,887,897


Dividends declared per common share

$

0.42



$

0.35



$

0.84



$

0.70


 

 

 

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 ended June 30,


Six months ended June 30,


2015


2014


2015


2014

Net income

$

31,141



$

32,958



$

57,474



$

64,602


Depreciation and amortization

26,185



23,603



51,212



46,872


Less: Non real estate depreciation and amortization

(157)



(185)



(301)



(357)


NAREIT FFO

57,169



56,376



108,385



111,117


Preferred stock dividends

(6,811)



(6,811)



(13,622)



(13,622)


NAREIT FFO attributable to common shares and common units

50,358



49,565



94,763



97,495


Severance expense and equity acceleration





5,578




Loss on early extinguishment of debt



338





338


Normalized FFO attributable to common shares and common units

50,358



49,903



100,341



97,833


Straight-line revenues, net of reserve

5,367



1,305



9,150



2,016


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

415



(598)



(178)



(1,197)


Compensation paid with Company common shares

1,288



1,507



2,629



3,100


Non real estate depreciation and amortization

157



185



301



357


Amortization of deferred financing costs

694



723



1,336



1,466


Improvements to real estate

(674)



(595)



(1,248)



(1,020)


Capitalized leasing commissions

(546)



(1,550)



(2,012)



(1,577)


AFFO attributable to common shares and common units

$

57,059



$

50,880



$

110,319



$

100,978


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

$

0.62



$

0.61



$

1.16



$

1.20


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

$

0.62



$

0.61



$

1.23



$

1.20


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

$

0.70



$

0.62



$

1.35



$

1.24


Weighted average common shares and common units outstanding

- diluted

81,244,826



81,529,141



81,612,738



81,480,797


 

 

(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)



June 30,
 2015


December 31,
 2014


(unaudited)



ASSETS




Income producing property:




Land

$

88,842



$

83,793


Buildings and improvements

2,731,820



2,623,539



2,820,662



2,707,332


Less: accumulated depreciation

(552,653)



(504,869)


Net income producing property

2,268,009



2,202,463


Construction in progress and land held for development

350,860



358,965


Net real estate

2,618,869



2,561,428


Cash and cash equivalents

105,887



29,598


Rents and other receivables, net

8,560



8,113


Deferred rent, net

133,215



142,365


Lease contracts above market value, net

6,474



8,054


Deferred costs, net

39,826



38,495


Prepaid expenses and other assets

48,699



48,295


Total assets

$

2,961,530



$

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

848,024



600,000


Accounts payable and accrued liabilities

31,914



26,973


Construction costs payable

24,406



32,949


Accrued interest payable

11,440



10,759


Dividend and distribution payable

39,690



39,981


Lease contracts below market value, net

5,279



7,037


Prepaid rents and other liabilities

63,544



65,174


Total liabilities

1,389,297



1,207,873


Redeemable noncontrolling interests – operating partnership

454,097



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 June 30, 2015 and December 31, 2014

185,000



185,000


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

166,250



166,250


Common stock, $.001 par value, 250,000,000 shares authorized, 65,386,777 shares issued

and outstanding at June 30, 2015 and 66,061,804 shares issued and outstanding at December

31, 2014

65



66


Additional paid in capital

766,821



764,025


Retained earnings




Total stockholders' equity

1,118,136



1,115,341


Total liabilities and stockholders' equity

$

2,961,530



$

2,836,348


 

 

 

DUPONT FABROS TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)



Six months ended June 30,


2015


2014

Cash flow from operating activities




Net income

$

57,474



$

64,602


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




Depreciation and amortization

51,212



46,872


Loss on early extinguishment of debt



338


Straight-line revenues, net of reserve

9,150



2,016


Amortization of deferred financing costs

1,336



1,466


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

(178)



(1,197)


Compensation paid with Company common shares

6,578



3,100


Changes in operating assets and liabilities




Rents and other receivables

(447)



2,231


Deferred costs

(2,031)



(442)


Prepaid expenses and other assets

418



(6,229)


Accounts payable and accrued liabilities

5,013



(994)


Accrued interest payable

693



605


Prepaid rents and other liabilities

(1,733)



6,260


Net cash provided by operating activities

127,485



118,628


Cash flow from investing activities




Investments in real estate – development

(106,347)



(128,068)


Interest capitalized for real estate under development

(5,857)



(6,163)


Improvements to real estate

(1,248)



(1,020)


Additions to non-real estate property

(568)



(283)


Net cash used in investing activities

(114,020)



(135,534)


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

(3,948)



(2,816)


Equity compensation (payments) proceeds

(7,544)



3,457


Common stock repurchases

(31,912)




Dividends and distributions:




Common shares

(55,202)



(39,333)


Preferred shares

(13,622)



(13,622)


Redeemable noncontrolling interests – operating partnership

(12,960)



(9,372)


Net cash provided by financing activities

62,824



34,314


Net increase in cash and cash equivalents

76,289



17,408


Cash and cash equivalents, beginning

29,598



38,733


Cash and cash equivalents, ending

$

105,887



$

56,141


Supplemental information:




Cash paid for interest

$

22,527



$

21,089


Deferred financing costs capitalized for real estate under development

$

447



$

354


Construction costs payable capitalized for real estate under development

$

24,406



$

25,032


Redemption of operating partnership units

$

598



$

2,400


Adjustments to redeemable noncontrolling interests - operating partnership

$

(53,868)



$

36,047


 

 

DUPONT FABROS TECHNOLOGY, INC.


Operating Properties

As of July 1, 2015


Property


Property Location


Year Built/
Renovated


Gross
Building
Area (2)


Computer Room
Square Feet

("CRSF")

(2)


CRSF %
Leased
(3)


CRSF %
Commenced
(4)


Critical
Load
MW (5)


Critical
Load %
Leased
(3)


Critical
Load %
Commenced
(4)

Stabilized (1)

















ACC2


Ashburn, VA


2001/2005


87,000



53,000



100

%


100

%


10.4



100

%


100

%

ACC3


Ashburn, VA


2001/2006


147,000



80,000



100

%


100

%


13.9



100

%


100

%

ACC4


Ashburn, VA


2007


347,000



172,000



100

%


100

%


36.4



100

%


100

%

ACC5


Ashburn, VA


2009-2010


360,000



176,000



99

%


99

%


36.4



99

%


99

%

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


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


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



97

%


97

%


236.9



96

%


96

%

Completed, not Stabilized

















ACC7 Phase I


Ashburn, VA


2014


126,000



67,000



75

%


75

%


11.9



84

%


84

%

CH2 Phase I


Elk Grove Village, IL


2015


94,000



45,000



20

%


20

%


7.1



20

%


20

%

Subtotal – not stabilized




220,000



112,000



53

%


53

%


19.0



60

%


60

%

Total Operating Properties




2,934,000



1,452,000



94

%


94

%


255.9



94

%


94

%


(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 July 1, 2015 represent $300 million of base rent on a GAAP basis and $312 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).

 

 

DUPONT FABROS TECHNOLOGY, INC.


Lease Expirations

As of July 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


Number
of Leases
Expiring (1)


CRSF of
Expiring Commenced Leases
(in thousands)
(2)


% of
Leased
CRSF


Total kW
of Expiring
Commenced Leases (2)


% of
Leased kW


% of
Annualized
Base Rent (3)

Month to month (4)


5



44



3.2

%


7,387



3.1

%


3.1

%

2015


1



53



3.9

%


10,400



4.3

%


4.1

%

2016


3



12



0.9

%


2,248



0.9

%


1.2

%

2017


13



84



6.2

%


13,905



5.8

%


5.7

%

2018


21



180



13.2

%


34,017



14.2

%


14.0

%

2019


20



291



21.4

%


51,740



21.6

%


21.9

%

2020


15



182



13.4

%


32,404



13.5

%


13.1

%

2021


10



157



11.5

%


25,569



10.7

%


10.9

%

2022


7



89



6.5

%


15,509



6.5

%


6.4

%

2023


3



29



2.1

%


4,386



1.8

%


1.6

%

2024


8



112



8.2

%


19,279



8.0

%


9.4

%

After 2024


9



127



9.5

%


22,856



9.6

%


8.6

%

Total


115



1,360



100

%


239,700



100

%


100

%


(1) Represents 38 customers with 115 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 July 1, 2015.

(4) Includes four leases with our bankrupt customer which DFT can terminate upon 30 days' notice and one lease where the lessee held over and has now departed.

 

 

 

DUPONT FABROS TECHNOLOGY, INC.


Top 15 Customers

As of July 1, 2015


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



Customer


Number of Buildings


Number of Markets


Remaining Term


% of
Annualized
Base Rent (1)

1

Microsoft


6



3



6.2



21.4

%

2

Facebook


4



1



5.1



19.0

%

3

Yahoo!


3



2



1.7



11.3

%

4

Rackspace


3



2



10.1



9.8

%

5

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


4



2



7.1



6.4

%

6

Fortune 25 Investment Grade Rated Company


2



2



3.1



5.0

%

7

Server Central


1



1



6.1



2.7

%

8

Net Data Centers


4



2



MTM


2.2

%

9

Zynga


1



1



0.6



2.1

%

10

Dropbox


1



1



3.5



1.7

%

11

IAC


1



1



3.8



1.7

%

12

Symantec


2



1



2.0



1.5

%

13

Fortune 25 Investment Grade Rated Company


2



2



5.7



1.2

%

14

UBS


1



1



10.0



1.1

%

15

Sanofi Aventis


2



1



6.0



1.0

%

Total








88.1

%


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

 

 

 

DUPONT FABROS TECHNOLOGY, INC.


Same Store Analysis

($ in thousands)


Same Store Properties

Three Months Ended


Six Months Ended




30-Jun-15


30-Jun-14


% Change


31-Mar-15


% Change


30-Jun-15


30-Jun-14


% Change

Revenue:

















Base rent

$

70,626



$

70,455



0.2

%


$

70,528



0.1

%


$

141,154



$

139,659



1.1

%


Recoveries from tenants

34,256



29,965



14.3

%


33,122



3.4

%


67,378



61,654



9.3

%


Other revenues

486



458



6.1

%


475



2.3

%


961



914



5.1

%

Total revenues

105,368



100,878



4.5

%


104,125



1.2

%


209,493



202,227



3.6

%



















Expenses:

















Property operating costs

28,686



27,782



3.3

%


30,375



(5.6)

%


59,061



57,877



2.0

%


Real estate taxes and insurance

6,928



3,410



N/M



3,771



83.7

%


10,699



6,870



55.7

%


Other expenses

30



52



N/M



14



N/M



44



77



(42.9)

%

Total expenses

35,644



31,244



14.1

%


34,160



4.3

%


69,804



64,824



7.7

%



















Net operating income (1)

69,724



69,634



0.1

%


69,965



(0.3)

%


139,689



137,403



1.7

%





















Straight-line revenues, net of reserve

4,339



1,305



N/M



3,492



24.3

%


7,831



2,016



N/M




Amortization of lease contracts above and below market value

415



(598)



N/A



(593)



N/A



(178)



(1,197)



(85.1)

%



















Cash net operating income (1)

$

74,478



$

70,341



5.9

%


$

72,864



2.2

%


$

147,342



$

138,222



6.6

%



















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


Six Months Ended




30-Jun-15


30-Jun-14


% Change


31-Mar-15


% Change


30-Jun-15


30-Jun-14


% Change

Revenue:

















Base rent

$

61,032



$

64,528



(5.4)

%


$

62,737



(2.7)

%


$

123,769



$

128,439



(3.6)

%


Recoveries from tenants

26,337



25,669



2.6

%


27,662



(4.8)

%


53,999



53,505



0.9

%


Other revenues

457



427



7.0

%


445



2.7

%


902



853



5.7

%

Total revenues

87,826



90,624



(3.1)

%


90,844



(3.3)

%


178,670



182,797



(2.3)

%



















Expenses:

















Property operating costs

23,302



23,923



(2.6)

%


25,585



(8.9)

%


48,887



50,662



(3.5)

%


Real estate taxes and insurance

3,350



2,727



22.8

%


2,894



15.8

%


6,244



5,509



13.3

%


Other expenses

14



35



N/M



13



N/M



27



59



(54.2)

%

Total expenses

26,666



26,685



(0.1)

%


28,492



(6.4)

%


55,158



56,230



(1.9)

%



















Net operating income (1)

61,160



63,939



(4.3)

%


62,352



(1.9)

%


123,512



126,567



(2.4)

%





















Straight-line revenues, net of reserve

4,716



1,505



N/M



3,678



28.2

%


8,394



2,335



N/M




Amortization of lease contracts above and below market value

415



(598)



N/A



(593)



N/A



(178)



(1,197)



(85.1)

%



















Cash net operating income (1)

$

66,291



$

64,846



2.2

%


$

65,437



1.3

%


$

131,728



$

127,705



3.2

%



















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












Three Months Ended


Six Months Ended




30-Jun-15


30-Jun-14


% Change


31-Mar-15


% Change


30-Jun-15


30-Jun-14


% Change

Operating income

$

44,616



$

46,234



(3.5)

%


$

46,010



(3.0)

%


$

90,626



$

90,937



(0.3)

%




















Depreciation and amortization

25,108



23,400



7.3

%


23,955



4.8

%


49,063



46,466



5.6

%



















Net operating income

69,724



69,634



0.1

%


69,965



(0.3)

%


139,689



137,403



1.7

%





















Straight-line revenues, net of reserve

4,339



1,305



N/M



3,492



24.3

%


7,831



2,016



N/M




Amortization of lease contracts

above and below market value

415



(598)



N/A



(593)



N/A



(178)



(1,197)



(85.1)

%



















Cash net operating income

$

74,478



$

70,341



5.9

%


$

72,864



2.2

%


$

147,342



$

138,222



6.6

%





































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










Three Months Ended


Six Months Ended




30-Jun-15


30-Jun-14


% Change


31-Mar-15


% Change


30-Jun-15


30-Jun-14


% Change

Operating income

$

39,501



$

42,717



(7.5)

%


$

41,178



(4.1)

%


$

80,679



$

84,161



(4.1)

%




















Depreciation and amortization

21,659



21,222



2.1

%


21,174



2.3

%


42,833



42,406



1.0

%



















Net operating income

61,160



63,939



(4.3)

%


62,352



(1.9)

%


123,512



126,567



(2.4)

%





















Straight-line revenues, net of

reserve

4,716



1,505



N/M



3,678



28.2

%


8,394



2,335



N/M




Amortization of lease contracts above and below market value

415



(598)



N/A



(593)



N/A



(178)



(1,197)



(85.1)

%



















Cash net operating income

$

66,291



$

64,846



2.2

%


$

65,437



1.3

%


$

131,728



$

127,705



3.2

%

 

 

(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 June 30, 2015

($ in thousands)


Property


Property
Location


Gross
Building
Area (1)


CRSF (2)


Critical
Load
MW (3)


Estimated
Total Cost (4)


Construction
in Progress &
Land Held for
Development
(5)


CRSF %
Pre-
leased


Critical
Load %
Pre-
leased


















Current Development Projects















CH2 Phase I (6)


Elk Grove Village, IL


94,000



45,000



7.1



   $74,000 - $78,000


$

69,700



20

%


20

%

ACC7 Phase II


Ashburn, VA


98,000



51,000



8.9



    78,000  -   82,000


53,856



34

%


33

%

ACC7 Phase III


Ashburn, VA


126,000



68,000



11.9



   106,000 - 110,000


31,924



%


%





318,000



164,000



27.9



   258,000 - 270,000


155,480























Future Development Projects/Phases















ACC7 Phase IV


Ashburn, VA


96,000



52,000



8.9



35,799


35,799






CH2 Phases II to III


Elk Grove Village, IL


242,000



115,000



18.5



  112,000 - 116,000


110,779






NJ1 Phase II


Piscataway, NJ


180,000



88,000



18.2



39,212


39,212










518,000



255,000



45.6



$187,011 -  $191,011


185,790






Land Held for Development















ACC8


Ashburn, VA


100,000



50,000



10.4





4,242






SC2 (7)


Santa Clara, CA


150,000



69,000



16.0





5,348










250,000



119,000



26.4





9,590






Total




1,086,000



538,000



99.9





$

350,860







(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 Phase I opening only.

(5) Amount capitalized as of June 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) CH2 Phase I was placed in service on July 1, 2015.

(7) Amounts listed are updated 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 June 30, 2015

($ in thousands)



June 30, 2015


Amounts


% of Total


Rates


Maturities

(years)

Secured

$

115,000



9

%


1.7

%


2.7


Unsecured

1,100,000



91

%


4.9

%


6.1


Total

$

1,215,000



100

%


4.6

%


5.8










Fixed Rate Debt:








Unsecured Notes due 2021

$

600,000



49

%


5.9

%


6.2


Unsecured Notes due 2023 (1)

250,000



21

%


5.6

%


8.0


Fixed Rate Debt

850,000



70

%


5.8

%


6.7


Floating Rate Debt:








Unsecured Credit Facility



%


%


2.9


Unsecured Term Loan

250,000



21

%


1.7

%


4.1


ACC3 Term Loan

115,000



9

%


1.7

%


2.7


Floating Rate Debt

365,000



30

%


1.7

%


3.6


Total

$

1,215,000



100

%


4.6

%


5.8



 

Note:      We capitalized interest and deferred financing cost amortization of $3.2 million and $6.3 million during the three and six months ended June 30, 2015, respectively.

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

 

 

Debt Principal Repayments as of June 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)



6/30/15


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 June 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



30.8

%

Common Shares

81

%


65,387








Operating Partnership ("OP") Units

19

%


15,419








Total Shares and Units

100

%


80,806








Common Share Price at June 30, 2015



$

29.45








Common Share and OP Unit Capitalization





$

2,379,737






Preferred Stock ($25 per share liquidation preference)





351,250






Total Equity







2,730,987



69.2

%

Total Market Capitalization







$

3,945,987



100.0

%



















 

 

 

DUPONT FABROS TECHNOLOGY, INC.


Common Share and OP Unit

Weighted Average Amounts Outstanding



Q2 2015


Q2 2014


YTD Q2

2015


YTD 2Q

2014

Weighted Average Amounts Outstanding for EPS Purposes:
















Common Shares - basic

65,030,132



65,486,202



65,266,766



65,417,615


Effect of dilutive securities

713,742



464,911



831,993



470,282


Common Shares - diluted

65,743,874



65,951,113



66,098,759



65,887,897










Weighted Average Amounts Outstanding for FFO,

Normalized FFO and AFFO Purposes:
















Common Shares - basic

65,030,132



65,486,202



65,266,766



65,417,615


OP Units - basic

15,419,237



15,578,028



15,419,734



15,592,900


Total Common Shares and OP Units

80,449,369



81,064,230



80,686,500



81,010,515










Effect of dilutive securities

795,457



464,911



926,238



470,282


Common Shares and Units - diluted

81,244,826



81,529,141



81,612,738



81,480,797










Period Ending Amounts Outstanding:








Common Shares

65,386,777








OP Units

15,419,237








Total Common Shares and Units

80,806,014








 

 

 

DUPONT FABROS TECHNOLOGY, INC.


2015 Guidance

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



Expected Q3 2015
per share


Expected 2015
per share

Net income per common share and common unit - diluted

   $0.26 to $0.29


  $1.03 to $1.13

Depreciation and amortization, net

0.33


1.28





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

  $0.59 to $0.62


  $2.31 to $2.41

Severance expense and equity accelerations


0.07

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

  $0.59 to $0.62


  $2.38 to $2.48

Straight-line revenues, net of reserve

0.05


0.19

Amortization of lease contracts above and below market value

(0.01)


(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)


(0.06)

Capitalized leasing commissions


(0.04)

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

   $0.63 to $0.67


  $2.56 to $2.66

 

2015 Debt Assumptions






May 7, 2015 Guidance


July 30, 2015 Guidance

Weighted average debt outstanding

        $1,143.8 million


$1,165.0 million

Weighted average interest rate (one month LIBOR avg. 0.22%)

4.42%


4.48%





Total interest costs

         $50.6 million


$52.2 million

Amortization of deferred financing costs

            3.7 million


4.2 million

      Interest expense capitalized

            (7.8) million


(10.7) million

      Deferred financing costs amortization capitalized

            (0.6) million


(0.7) million

Total interest expense after capitalization

         $45.9 million


$45.0 million









2015 Other Guidance Assumptions






May 7, 2015 Guidance


July 30, 2015 Guidance

Total revenues

         $425 to $445 million


         $435 to $445 million

Base rent (included in total revenues)

          $290 to $305 million


          $292 to $300 million

General and administrative expense

         $18 to $19 million


         $18 to $19 million

Investments in real estate - development (2)

         $150 to $170 million


         $180 to $200 million

Improvements to real estate excluding development

         $5 million


         $5 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, 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-second-quarter-2015-results-300120899.html

SOURCE DuPont Fabros Technology, Inc.

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