THIRD QUARTER 2017 EARNINGS OCTOBER 31, 2017 THIRD QUARTER 2017 EARNINGS October 31, 2017
SAFE HARBOR S AF E H AR B O R This presentation contains forward-looking statements regarding future events and our future results that are subject to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, are statements that could be deemed forward-looking statements. These statements are based on current expectations, estimates, forecasts, and projections about the industries in which we operate and the beliefs and assumptions of our management. Words such as “expects,” “anticipates,” “predicts,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “continues,” “endeavors,” “strives,” “may,” variations of such words and similar expressions are intended to identify such forward-looking statements. In addition, any statements that refer to projections of our future financial performance, our anticipated growth and trends in our businesses, and other characterizations of future events or circumstances are forward-looking statements. Readers are cautioned these forward-looking statements are based on current expectations and assumptions that are subject to risks and uncertainties, which could cause our actual results to differ materially and adversely from those reflected in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in this release and those discussed in other documents we file with the Securities and Exchange Commission (SEC). More information on potential risks and uncertainties is available in our recent filings with the SEC, including CyrusOne’s Form 10 -K report, Form 10-Q reports, and Form 8-K reports. Actual results may differ materially and adversely from those expressed in any forward- looking statements. We undertake no obligation to revise or update any forward-looking statements for any reason. For additional information, including reconciliation of any non-GAAP financial measures, please reference the supplemental report furnished by the Company on a Current Report on Form 8-K filed October 30, 2017. Unless otherwise noted, all data herein is as of September 30, 2017. Third Quarter 2017 Earnings Presentation 2
THIRD QUARTER 2017 OVERVIEW
HIGHLIGHTS Strong growth, bookings performance, and new logo acquisition reflecting continuation of secular demand trends. New strategic partnership with GDS expands global presence. ▪ 3Q’17 Revenue of $175.3 million, up 22% over 3Q’16 High Growth Rates ▪ 3Q’17 Adjusted EBITDA of $95.9 million, up 31% over 3Q’16 Across Financial Metrics ▪ 3Q’17 Normalized FFO per share of $0.79, up 18% over 3Q’16 ▪ Leased 15 MW and 151,000 CSF (1) in 3Q’17 totaling $27 million in annualized GAAP Sustained Leasing revenue (2) Momentum and Nearly ▪ Backlog of $37 million in annualized GAAP revenue as of the end of 3Q’17, representing $40 Million Backlog more than $290 million in total contract value ▪ Signed 18 new logos representing 36% of annualized GAAP revenue booked during the Significant Contribution quarter from New Customers ▪ Includes five new F1000 logos across a diverse set of verticals, increasing the total number Including F1000 of F1000 customers to 195 ▪ Subsequent to the end of the quarter, executed a commercial agreement with and made a $100 million investment in GDS, a leading data center provider in China Strategic Partnership with ▪ Two of the fastest growing data center companies will work together to sell in the U.S. and GDS China, the two largest economies in the world, with each country having a significant concentration of hyperscale companies Notes: 1. Colocation square feet (CSF) represents NRSF currently leased or available for lease as colocation space, where customers locate their servers and other IT equipment. Net rentable square feet (NRSF) represents the total square feet of a building currently leased or available for lease, based on engineers’ drawings and estimates but does not in clude space held for development or space used by CyrusOne. 2. Annualized GAAP revenue is equal to monthly recurring rent, defined as average monthly contractual rent during the term of the lease plus the monthly impact of installation charges, multiplied by 12. Third Quarter 2017 Earnings Presentation 4
STRONG LEASING Annualized GAAP Revenue and MW Signed Continued Strong ($MM) Annualized GAAP Revenue Signed MW Signed $40 Leasing Results 2 25 Annualized GAAP Rev. Signed $31.6 ▪ Annualized GAAP Prior 4-qtr. avg.: $29.6 2 20 $30 revenue signed in line $26.8MM $27.0 $26.7 MW Signed with prior four-quarter 18 17 1 15 17 average $19.1 $20 15 ▪ $107MM in annualized 10 1 GAAP revenue signed 9 $10 over the last 12 5 5 months, equivalent to 19% of base revenue - - $0 3Q'16 4Q'16 1Q'17 2Q'17 3Q'17 ▪ 32% of annualized GAAP revenue signed in 3Q’17 for leases < 3Q’17 GAAP Revenue MRR (1) / kW Signed 500kW Annualized GAAP Revenue Signed as a % of Signed Base Revenue - TTM ($MM) $150 ▪ $150 MRR / kW $147 Annualized GAAP Revenue Signed $107 signed, 2% above prior 32% four-quarter average Base Revenue $564 68% and 10% above prior eight-quarter average Bookings as a % of Base Revenue 19% ≤ 500 kW 3Q'16-2Q'17 avg. 3Q'17 Note: MRR, or monthly recurring rent, is defined as the average monthly contractual rent during the term of the lease. It includes the monthly impact of installation charges of approximately $0.2MM in 2Q’17 and 3Q’17 and $0.1MM 1. in every other quarter. Third Quarter 2017 Earnings Presentation 5
DEMAND ACROSS BOTH CLOUD AND ENTERPRISE VERTICALS % MRR Signed Broad demand with new logos across many verticals and markets. New Customers 14% 18 new logos signed Five new F1000 logos Deployments among across wide range of signed across four new logos in almost verticals verticals every U.S. market 3Q’16 - 2Q’17 avg. IT - Cloud Healthcare Financial Services Austin New York Metro IT - Mgd. Svcs. Energy Healthcare Chicago Northern Virginia 36% Telecomm. Industrials Telecommunications Cincinnati Phoenix Financial Services Industrials Dallas Raleigh-Durham Houston 3Q’17 Revenue (1) by Vertical Healthcare IT - Managed Services Hyperscale Cloud Companies Continuing to Drive Growth 4% 4% Industrials IT - Enterprise / Other 8% 7% Telecommunications 8% ▪ IT - Cloud vertical represented > 55% of annualized GAAP revenue signed during quarter 9% Other ▪ Cloud customers deploying across many markets 29% IT - Cloud 11% ▪ CyrusOne able to deliver cost-effective solution in time- Energy efficient manner 20% Financial Services Note: 1. Based on September 2017 annualized rent. Annualized rent represents cash rent, including metered power reimbursements, for the month of September, multiplied by 12. Third Quarter 2017 Earnings Presentation 6
INTERCONNECTION GROWTH Interconnection trends resulting in acceleration in revenue growth. ▪ Strong bookings quarter with $2.4MM in annualized GAAP Bookings revenue signed Prior four-quarter average of $2.1MM ▪ 91% of leases signed in 3Q’17 included interconnection Dedicated network connections to cloud Dedicated network connections to cloud providers providers contributing to interconnection growth contributing to Interconnect growth Number of Cross Connects Cross Connects >13,800 >11,000 ~700 new cross connects added during 3Q’17 SDN-enabled elastic cloud interconnection provides on-ramp for multi-cloud solution Mar'16 Sep'17 Revenue ($MM) Development of Revenue ecosystems within data $9.0 centers driving demand National & Metro IX $7.4 for cross connects and, in turn, revenue growth Expansion of the ecosystem of carrier partners, enterprises, cloud companies, and network providers 3Q'16 3Q'17 Third Quarter 2017 Earnings Presentation 7
CONSTRUCTION TO MEET DEMAND IN KEY MARKETS Company-record construction in 3Q’17 to position CyrusOne to meet strong demand across key markets. 3Q’17 Construction: Highlights ▪ Completion of eight projects across five markets totaling 555K CSF and 76 MW ▪ Increased size of CSF footprint by 22% in 3Q’17 vs. ▪ Skilled and experienced construction team 2Q’17 with proven ability to bring significant capacity online across multiple markets to ▪ Capacity aligned with sales meet demand funnel to capitalize on strong demand and position company for continued strong Market CSF MW growth Phoenix 222K 30 MW ▪ When fully leased, new Northern Virginia 121K 15 MW inventory expected to deliver Chicago 77K 16 MW annualized revenue of Dallas 75K 3 MW $75MM - $100MM San Antonio 60K 12 MW Currently 49% leased Total 555K 76 MW Third Quarter 2017 Earnings Presentation 8
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