Earnings Call Presentation Zayo Group Holdings, Inc. Fiscal Year - PowerPoint PPT Presentation

Earnings Call Presentation Zayo Group Holdings, Inc. Fiscal Year 2016 Q2 NYSE: ZAYO @ZayoGroup

Safe Harbor Information contained in this presentation that is not historical by nature constitutes “forward - looking statements” which can be identified by the use of forward- looking terminology such as “believes,” “expects,” “plans,” “intends,” “estimates,” “projects,” “could,” “may,” “will,” “should,” or “anticipates” or the negatives thereof, other variations thereon or comparable terminology, or by discussions of strategy. No assurance can be given that future results expressed or implied by the forward-looking statements will be achieved and actual results may differ materially from those contemplated by the forward-looking statements. Such statements are based on management’s current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements. These risks and uncertainties include, but are not limited to, those relating to Zayo Group Holdings, Inc.’s (“the Company” or “ZGH”) financial and operating prospects, current economic trends, future opportunities, ability to retain existing customers and attract new ones, outlook of customers, and strength of competition and pricing. In addition, there is risk and uncertainty in the Company’s acquisition strategy including our ability to integrate acquired companies and assets. Specifically there is a risk associated with our recent acquisitions, and the benefits thereof, including financial and operating results and synergy benefits that may be realized from these acquisitions and the timeframe for realizing these benefits. Other factors and risks that may affect our business and future financial results are detailed in the “Risk Factors” section of our Annual Report or Form 10 -K filed with the Securities and Exchange Commission (“SEC”) on September 18, 2015. We caution you not to place undue reliance on these forward-looking statements, which speak only as of their respective dates. We undertake no obligation to publicly update or revise forward-looking statements to reflect events or circumstances after releasing this supplemental information or to reflect the occurrence of unanticipated events, except as required by law. In addition to this presentation and our filings with the SEC, the Company provides a supplemental earnings presentation, pricing supplement and a glossary of terms used throughout. All of which can be found under the investor section of the Company’s website at http://www.zayo.com/investors. 2 2

Dan Caruso Chairman & Chief Executive Officer 3

FY 2Q16 Highlights 25 th consecutive quarter of consecutive revenue growth 6% organic recurring revenue growth record gross installs of $6.4M and near-record net installs of $2.2M bookings of $6.8M closed Viatel (UK/EU fiber) and Stream (Dallas colo) acquisitions signed Allstream acquisition 4

Zayo at a Glance Unique Metro Fiber International Network Datacenters People Our assets 7,442,113 fiber miles 1,949 employees 19,341 buildings 55 zColo datacenters 135 QBHC 95,178 route miles 149 avg metro fiber count >590k billable sf What we do Products Customers Leading Fiber & 37% Dark Fiber Solutions 6.7k customers Datacenter Consolidator 54% of rev from enterprise & content 46% Network Connectivity 37 acquisitions to date 16% Colo & Cloud Infrastructure 46% carriers & wireless 5 since Jan 2015 1% Other Value Creation Financial 1 Growth Track record $ $1.1B invested equity since 25 consecutive quarters of $1.5B revenue 2007 inception sequential revenue growth 2 $876M adjusted EBITDA ~$6.3B equity value 3 >5x return 1 Quarter ended Dec -15 annualized 2 Every quarter since becoming a public filer inclusive of Zayo Group, LLC operating subsidiary 5 3 Based on average closing price for month of Dec-15

Segments & Products 1 % of Adj. % Revenue % EBITDA UFCF Dark Fiber Solutions 30% 37% 71% Dark Fiber Leased raw fiber Mobile Infrastructure Tower/small cell backhaul 7% 8% -60% Subtotal 37% 45% 11% 1G, 2.5G, 10G & 100G Wavelengths 19% 16% 4% Network Connectivity waves Switched & dedicated Ethernet 11% 11% 25% service 9% 8% 17% IP Services Internet access & transit Legacy carrier-grade 6% 6% 20% SONET service Subtotal 46% 41% 66% Infrastructure Space, power & Colocation Interconnect-Oriented Colo & Cloud interconnects 13% 12% 20% Infrastructure-as-a- Cloud Services 3% 2% 2% Service Subtotal 16% 13% 22% 1 Based on quarter ended Dec-15 Dark Fiber Solutions, Network Connectivity, & Colocation & Cloud Infrastructure segment results; revenue from “Other” segment represents 1% of total revenue 6 FY2015 Q4 Earnings Presentation

Q2 Financial Highlights Revenue ($M) $367 $370 $400 >98% of revenue is recurring $324 $5 $350 $8 $9 $300 3% QoQ annualized total revenue growth $250  4% in constant currency $200 6% QoQ annualized recurring revenue growth $150  7% in constant currency $100 $50 $314 $359 $365 $0 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Recurring Other Adjusted EBITDA ($M) 59% 58% 57% 59% 58% 58% 59% 59% $250 $215 $219 $2 $190 $5 $200 $6 $150 7% QoQ annualized total EBITDA growth $100 12% QoQ annualized recurring EBITDA growth $50 $184 $211 $217 $0 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Associated with Other Revenue Excluding Associated with Other Revenue Adjusted EBITDA Margin 7 7

Q2 Financial Highlights Cont. Purchases of Property & Equipment ($M) $200 $172 $159 $3 $3 >90% of capex growth-related $6 $150 $130 $7 $4 net AFFO 1 of $98M or 27% of revenue $6 $100 ($26M) of quarterly levered free cash flow $50 $120 $150 $163 $0 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Growth Maintenance Other Levered FCF Net AFFO ($M) ($M) (capturing churn replacement) % of Revenue $350 % of Revenue $200 24% 25% 1% -2% 11% 11% 10% -7% 30% 24% 20% 26% 32% 32% 35% 27% $250 195 $150 146 124 $127 $150 $98 $50 $100 $36 $85 ($6) ($26) ($50) $50 ($150) ($130) ($159) ($172) $0 ($250) 2 3 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Purchases of PP&E Cash Flow From Operations LFCF 1 Includes churn replacement capex plus ~0.5% implied growth 2 Quarter ended Sep-15 LFCF impacted by ~$8M non-cash charge offset in cash flow from financing activities 3 8 Quarter ended Dec-15 includes $54M of semi-annual interest payments and $17M of deferred interest from Jun-15 quarter senior notes offerings 8

Q2 Operational Highlights Gross Installations Churn Processed ($M) ($M) $6.4 $7.0 $0.0 $6.0 ($2.5) ($2.8) ($3.1) $5.5 $6.0 ($1.0) $1.3 $1.1 $5.0 ($2.0) MRR and MAR MRR and MAR $1.4 $4.0 ($3.0) ($1.2) ($1.0) ($1.0) $3.0 ($4.0) ($3.7) ($3.8) ($4.2) $2.0 ($5.0) $1.0 ($6.0) Churn % = $4.1 $4.9 $5.1 -1.3% -1.3% -1.3% -1.2% -1.3% -1.2% -1.1% -1.2% $0.0 ($7.0) Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Upgrades / Price Increase / Replacement Hard Disconnects Installations from New Services Upgrades / Price Decrease / Replacement ($M) Net Installations $7.0 record gross install quarter at $6.4M $6.0 MRR and MAR $5.0 near-record $2.2M net installs $4.0 net installs imply 7% annualized recurring $3.0 $2.2 $2.2 revenue growth rate 1 $1.8 $2.0 $1.0 $0.0 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 9 9 1 Implied by the current quarter pace of Net Installs, calculated as Net Installs annualized ($2.199M * 4 = $8.796M), divided by the beginning of quarter run-rate $119.8M = 7.3%

Q2 Operational Highlights Cont. Last day of quarter run-rate ($M) (MRR+MAR) $150 $123.5 $119.8 $104.8 12% QoQ annualized revenue run-rate growth $100  14% in constant currency 6% excluding December 31, 2015 acquisitions $50  7% in constant currency $0 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Service Activation Pipeline ($M) 87 91 93 90 95 96 100 98 $20 $14.0 $14.4 $15 record service activation pipeline represents $11.0 12% of revenue run-rate $10 47 months average remaining contract term $7.9 $5.1 $8.4 $5 $5.9 $5.7 $6.5 $0 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Delivery date after 6 months Delivery date within the next 6 months Implied Average Days to Install 10 10

Q2 Operational Highlights Cont. Net New Sales (Bookings) Stratification ($M) $8.0 $6.8 $6.4 $7.0 $0.9 $0.3 $6.0 $5.2 CY15 bookings grew >20% YOY $0.1 MRR and MAR $5.0 $1.7 $1.6 ~2/3 of bookings have <12 month payback $1.4 $4.0 $3.0 13% associated with speculative projects $2.0 $1.0 $3.8 $4.4 $4.3 $0.0 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 <12 Month Payback and Positive IRR >12 Month Payback and Positive IRR Contract Value vs. Capex on Bookings Speculative Projects ($M) 17 16 35 15 38 33 12 42 $750 $404 $474 $550 total bookings contract value > 1.5x the $227 $350 associated committed capex $150 average payback of 42 months includes ($50) $0.9M of speculative project bookings ($96) ($250) ($134) ($312) ($450) Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Contract Value Capex & Upfront Expenditures Payback Months 11 11