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8-K - FORM 8-K - DUPONT FABROS TECHNOLOGY, INC.d341194d8k.htm

Exhibit 99.1

[LOGO]

 

   First Quarter 2012
   Earnings Release
   and Supplemental Information

[PHOTOGRAPH OF CH1 DATA CENTER FACILITY]

 

[PHOTOGRAPH OF CH1 DATA CENTER FACILITY]   
   CH1 Data Center
   Elk Grove Village, IL

 

DuPont Fabros Technology, Inc.

1212 New York Avenue, NW

Suite 900

Washington, D.C. 20005

    

(202) 728-0044

www.dft.com

NYSE: DFT

    

Investor Relations Contact:

Mr. Christopher A. Warnke

investorrelations@dft.com

(202) 478-2330


[LOGO]

First Quarter 2012 Results

Table of Contents

 

Earnings Release

     1-4   

Consolidated Statements of Operations

     5   

Reconciliations of Net Income to Funds From Operations and Adjusted Funds From Operations

     6   

Consolidated Balance Sheets

     7   

Consolidated Statements of Cash Flows

     8   

Operating Properties

     9   

Lease Expirations

     10   

Development Projects

     11   

Debt Summary and Debt Maturity

     12   

Selected Unsecured Debt Metrics and Capital Structure

     13   

Common Share and Operating Partnership Unit Weighted Average Amounts Outstanding

     14   

2012 Guidance

     15   

Note: This press release supplement contains certain non-GAAP financial measures that management believes are helpful in understanding the company’s business, as further discussed within this press release supplement. These financial measures, which include Funds From Operations, Adjusted Funds From Operations, Funds From Operations per share and Adjusted Funds From Operations per share, should not be considered as an alternative to net earnings 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.


[LOGO]

NEWS

DUPONT FABROS TECHNOLOGY, INC. REPORTS FIRST QUARTER 2012 RESULTS

Revenues up 14%

2012 Guidance Increased

Second Quarter Dividend Increased by 25%

WASHINGTON, DC, — April 26, 2012 - DuPont Fabros Technology, Inc. (NYSE: DFT) today reported results for the quarter ended March 31, 2012. All per share results are reported on a fully diluted basis.

Highlights

 

 

As of today, the company’s stabilized operating portfolio is 99% leased, the non-stabilized portfolio is 57% leased and in the development portfolio, ACC6 Phase II is 67% pre-leased.

 

 

First quarter 2012 activity:

 

   

Placed in service CH1 Phase II in Elk Grove Village, Illinois, comprising 18.2 megawatts (“MW”) of critical load.

 

   

Issued 2.6 million additional shares of 7.625% Series B perpetual preferred stock raising net proceeds of approximately $62.7 million.

 

   

Signed three leases totaling 4.83 MW and 23,385 raised square feet.

 

   

Commenced seven leases totaling 15.23 MW and 83,191 raised square feet.

 

 

Subsequent to the first quarter:

 

   

Signed two leases and a pre-lease totaling 18.42 MW and 92,917 raised square feet. ACC6 Phase I is now 83% leased and Phase II is 67% pre-leased.

 

   

Commenced development of ACC6 Phase II which we expect to complete at the end of 2012.

Hossein Fateh, President and Chief Executive Officer, said “We are pleased to have exceeded our leasing expectations at this point in the year. To date, we signed 23.25 MW of leases which includes a significant pre-lease on a future development. We remain focused on leasing and continue to believe our strategically located wholesale facilities provide us the opportunity to drive solid growth for our investors. The combination of strong operating results, the lease commencements to date and the outlook for the remainder of the year has contributed to the Board’s decision to increase the common dividend by 25 percent to an annualized rate of $0.60 per share and the company’s decision to increase our full year FFO guidance.”

 

- 1 -


First Quarter 2012 Results

For the quarter ended March 31, 2012, the company reported earnings of $0.08 per share compared to $0.15 per share for the first quarter of 2011. The decrease in earnings per share is due to lower capitalized interest and higher preferred dividends. Revenues increased 14%, or $9.9 million, to $78.4 million for the first quarter of 2012 over the first quarter of 2011. The increase in revenues is primarily due to new leases commencing at our non-stabilized properties.

Funds from Operations (“FFO”) for the quarter ended March 31, 2012 was $0.34 per share compared to $0.38 per share for the quarter ended March 31, 2011. The decrease of $0.04 per share is primarily due to:

 

   

Higher operating income, excluding depreciation, of $0.05 per share primarily due to new leases commencing of $0.07 per share, partially offset by the unreimbursed property operating expenses, real estate taxes and insurance of $0.02 per share.

 

   

Higher fixed charges of $0.09 per share representing lower capitalized interest expense of $0.06 per share and additional preferred dividends of $0.03 per share.

Portfolio Update

During the first quarter 2012, the company:

 

   

Signed three leases totaling 4.83 MW of critical load and 23,385 raised square feet with an average lease term of 6.5 years.

 

   

Two leases were at SC1 Phase I for 4.55 MW of critical load and 22,000 raised square feet. Both of these leases commenced in the first quarter.

 

   

One lease was at NJ1 Phase I for 0.28 MW of critical load and 1,385 raised square feet. This lease commenced in the first quarter.

Subsequent to the first quarter the company:

 

   

Signed two leases and one pre-lease for 18.42 MW and 92,917 raised square feet.

 

   

Two leases were at ACC6 Phase I totaling 9.75 MW and 48,984 raised square feet. One lease for 8.67 MW commenced in the second quarter and the other 1.08 MW lease will commence in the third quarter of 2012.

 

   

The pre-lease was at ACC6 Phase II totaling 8.67 MW and 43,933 raised square feet. This lease is scheduled to commence in equal parts in the first and third quarters of 2013. Separately, the company granted this tenant a delay of the lease commencements of 3.9 MW scheduled for 2012 and 2013 until 2013 and 2014 at our CH1 Phase II facility; however, the tenant has the ability to commence those leases earlier if it so chooses. In addition, the tenant also has the right to relinquish 2.6 MW of the 3.9 MW by notifying the company by January 2013.

 

   

Commenced development of ACC6 Phase II, which is 67% pre-leased. Completion is anticipated in late 2012.

Year-to-date, the company:

 

   

Signed six leases totaling 23.25 MW and 116,302 raised square feet with an average lease term of 12.5 years and approximate contract value of $600 million.

 

   

Commenced eight leases totaling 23.90 MW and 127,191 raised square feet.

 

- 2 -


Capital Markets Update

In January 2012, the company sold 2.6 million additional shares of 7.625% Series B preferred stock at a price of $25 per share raising net proceeds of approximately $62.7 million.

In March 2012, the company amended its unsecured line of credit, increasing the facility from $100 million to $225 million, extending the maturity to March 2016 and lowering the interest rate. The facility contains an accordion feature to increase the facility by an additional $175 million with lender approval.

As of today, there are no borrowings outstanding under the line of credit.

Common Dividend

The company’s Board of Directors increased the quarterly common dividend in the second quarter of 2012 by 25 percent to $0.15 per share, an annualized rate of $0.60 per share.

2012 Guidance

The company is increasing its 2012 FFO guidance range to $1.44 to $1.54 per share from $1.31 to $1.51 per share. The $0.08 increase in the midpoint to $1.49 per share is due to leases signed and commenced year to date, and the forecasted capitalization of interest and G&A costs due to the start of the ACC6 Phase II development.

The company has established an FFO guidance range of $0.35 to $0.37 per share for the second quarter of 2012. The $0.02 per share increase from the company’s first quarter 2012 FFO of $0.34 per share and the midpoint of the second quarter guidance range is primarily due to:

 

   

A positive impact of $0.03 from higher operating income excluding depreciation and

 

   

A negative impact of $0.01 from lower capitalized interest.

First Quarter 2012 Conference Call and Webcast Information

The company will host a conference call to discuss these results today, Thursday, April 26, 2012 at 10:00 a.m. ET. To access the live call, please visit the Investor Relations section of the company’s website at www.dft.com or dial 1-866-524-3160 (domestic) or 1-412-317-6760 (international). A replay will be available for seven days by dialing 1-877-344-7529 (domestic) or 1-412-317-0088 (international) using passcode 10012584. The webcast will be archived on the company’s website for one year at www.dft.com on the Presentations & Webcasts page.

Second Quarter 2012 Conference Call

DuPont Fabros Technology, Inc. expects to announce second quarter 2012 results on Wednesday, July 25, 2012 and to host a conference call to discuss those results at 10:00 a.m. ET on Thursday, July 26, 2012.

 

- 3 -


About DuPont Fabros Technology, Inc.

DuPont Fabros Technology, Inc. (NYSE: DFT) is a real estate investment trust (REIT) and leading owner, developer, operator and manager of wholesale data centers. The company’s data centers are highly specialized, secure, network-neutral facilities used primarily by national and international Internet and enterprise companies to house, power and cool the computer servers that support many of their most critical business processes. DuPont Fabros Technology, Inc. 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 the company’s control. The company faces many risks that could cause its actual performance to differ materially from the results contemplated by its forward-looking statements, including, without limitation, the risk that its assumptions underlying its 2012 FFO guidance are not realized, the risks related to the leasing of available space to third-party tenants, including delays in executing new leases and failure to negotiate leases on terms that will enable it to achieve its expected returns, the risk that the company 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 the company will not declare and pay dividends as anticipated for 2012 and the risk that the company may not be able to maintain its qualification as a REIT for federal tax purposes. The periodic reports that the company files with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2011, contain detailed descriptions of these and many other risks to which the company is subject. These reports are available on our website at www.dft.com. Because of the risks described above and other unknown risks, the company’s actual results, performance or achievements may differ materially from the results, performance or achievements contemplated by its forward-looking statements. The information set forth in this news release represents management’s expectations and intentions only as of the date of this press release. The company assumes no responsibility to issue updates to the contents of this press release.

 

- 4 -


DUPONT FABROS TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited and in thousands except share and per share data)

 

     Three months ended March 31,  
     2012     2011  

Revenues:

    

Base rent

   $ 53,170      $ 47,188   

Recoveries from tenants

     24,086        20,858   

Other revenues

     1,126        453   
  

 

 

   

 

 

 

Total revenues

     78,382        68,499   

Expenses:

    

Property operating costs

     22,363        18,100   

Real estate taxes and insurance

     2,171        1,656   

Depreciation and amortization

     21,870        18,091   

General and administrative

     5,236        4,798   

Other expenses

     668        198   
  

 

 

   

 

 

 

Total expenses

     52,308        42,843   
  

 

 

   

 

 

 

Operating income

     26,074        25,656   

Interest income

     34        211   

Interest:

    

Expense incurred

     (11,863     (7,659

Amortization of deferred financing costs

     (887     (624
  

 

 

   

 

 

 

Net income

     13,358        17,584   

Net income attributable to redeemable noncontrolling interests – operating partnership

     (1,570     (3,472
  

 

 

   

 

 

 

Net income attributable to controlling interests

     11,788        14,112   

Preferred stock dividends

     (6,619     (4,157
  

 

 

   

 

 

 

Net income attributable to common shares

   $ 5,169      $ 9,955   
  

 

 

   

 

 

 

Earnings per share – basic:

    

Net income attributable to common shares

   $ 0.08      $ 0.15   
  

 

 

   

 

 

 

Weighted average common shares outstanding

     62,568,547        60,210,596   
  

 

 

   

 

 

 

Earnings per share – diluted:

    

Net income attributable to common shares

   $ 0.08      $ 0.15   
  

 

 

   

 

 

 

Weighted average common shares outstanding

     63,548,098        61,382,290   
  

 

 

   

 

 

 

Dividends declared per common share

   $ 0.12      $ 0.12   
  

 

 

   

 

 

 

 

- 5 -


DUPONT FABROS TECHNOLOGY, INC.

RECONCILIATIONS OF NET INCOME TO FFO AND AFFO (1)

(unaudited and in thousands except share and per share data)

 

     Three months ended March 31,  
     2012     2011  

Net income

   $ 13,358      $ 17,584   

Depreciation and amortization

     21,870        18,091   

Less: Non real estate depreciation and amortization

     (274     (203
  

 

 

   

 

 

 

FFO

     34,954        35,472   

Preferred stock dividends

     (6,619     (4,157
  

 

 

   

 

 

 

FFO attributable to common shares and OP units

   $ 28,335      $ 31,315   

Straight-line revenues

     (5,023     (11,868

Amortization of lease contracts above and below market value

     (979     (536

Compensation paid with Company common shares

     2,034        1,406   
  

 

 

   

 

 

 

AFFO

   $ 24,367      $ 20,317   
  

 

 

   

 

 

 

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

   $ 0.34      $ 0.38   
  

 

 

   

 

 

 

AFFO per share - diluted

   $ 0.30      $ 0.25   
  

 

 

   

 

 

 

Weighted average common shares and OP units outstanding - diluted

     82,553,495        82,383,011   
  

 

 

   

 

 

 

 

(1) Funds from operations, or FFO, is used by industry analysts and investors as a supplemental operating performance measure for REITs. The Company calculates 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. The Company also presents 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.

The Company uses 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. The Company also believes that, as a widely recognized measure of the performance of equity REITs, FFO may be used by investors as a basis to compare the Company’s 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 the Company’s properties that result from use or market conditions nor the level of capital expenditures and leasing commissions necessary to maintain the operating performance of the Company’s properties, all of which have real economic effects and could materially impact the Company’s results from operations, the utility of FFO as a measure of the Company’s 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 the Company’s FFO. Therefore, the Company believes that in order to facilitate a clear understanding of its 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 the Company’s liquidity, nor is it indicative of funds available to meet the Company’s cash needs, including its ability to pay dividends or make distributions.

The Company also presents FFO with supplemental adjustments to arrive at Adjusted FFO (“AFFO”). AFFO is FFO attributable to common shares and OP units excluding straight-line revenue, non-cash stock based compensation, gain or loss on derivative instruments, acquisition of service agreements, below market lease amortization net of above market lease amortization and early extinguishment of debt costs. 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 the Company’s 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 the Company’s cash needs including the Company’s ability to pay dividends. In addition, AFFO may not be comparable to similarly titled measurements employed by other companies. The Company’s management uses AFFO in management reports to provide a measure of REIT operating performance that can be compared to other companies using AFFO.

 

- 6 -


DUPONT FABROS TECHNOLOGY, INC.

CONSOLIDATED BALANCE SHEETS

(in thousands except share data)

 

     March 31,
2012
    December 31,
2011
 
     (unaudited)        

ASSETS

    

Income producing property:

    

Land

   $ 73,197      $ 63,393   

Buildings and improvements

     2,309,961        2,123,377   
  

 

 

   

 

 

 
     2,383,158        2,186,770   

Less: accumulated depreciation

     (262,654     (242,245
  

 

 

   

 

 

 

Net income producing property

     2,120,504        1,944,525   

Construction in progress and land held for development

     142,802        320,611   
  

 

 

   

 

 

 

Net real estate

     2,263,306        2,265,136   

Cash and cash equivalents

     55,198        14,402   

Restricted cash

     19        174   

Rents and other receivables

     4,517        1,388   

Deferred rent

     131,885        126,862   

Lease contracts above market value, net

     11,080        11,352   

Deferred costs, net

     40,487        40,349   

Prepaid expenses and other assets

     27,019        31,708   
  

 

 

   

 

 

 

Total assets

   $ 2,533,511      $ 2,491,371   
  

 

 

   

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

    

Liabilities:

    

Line of credit

   $ —        $ 20,000   

Mortgage notes payable

     143,500        144,800   

Unsecured notes payable

     550,000        550,000   

Accounts payable and accrued liabilities

     23,682        22,955   

Construction costs payable

     7,299        20,300   

Accrued interest payable

     14,186        2,528   

Dividend and distribution payable

     15,600        14,543   

Lease contracts below market value, net

     17,062        18,313   

Prepaid rents and other liabilities

     33,602        29,058   
  

 

 

   

 

 

 

Total liabilities

     804,931        822,497   

Redeemable noncontrolling interests—operating partnership

     463,740        461,739   

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 March 31, 2012 and December 31, 2011

     185,000        185,000   

Series B cumulative redeemable perpetual preferred stock, 6,650,000 issued and outstanding at March 31, 2012 and 4,050,000 shares issued and outstanding at December 31, 2011

     166,250        101,250   

Common stock, $.001 par value, 250,000,000 shares authorized, 63,098,510 shares issued and outstanding at March 31, 2012 and 62,914,987 shares issued and outstanding at December 31, 2011

     63        63   

Additional paid in capital

     915,438        927,902   

Accumulated deficit

     (1,911     (7,080
  

 

 

   

 

 

 

Total stockholders’ equity

     1,264,840        1,207,135   
  

 

 

   

 

 

 

Total liabilities and stockholders’ equity

   $ 2,533,511      $ 2,491,371   
  

 

 

   

 

 

 

 

- 7 -


DUPONT FABROS TECHNOLOGY, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited and in thousands)

 

     Three months ended
March 31,
 
     2012     2011  

Cash flow from operating activities

    

Net income

   $ 13,358      $ 17,584   

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

    

Depreciation and amortization

     21,870        18,091   

Straight line rent

     (5,023     (11,868

Amortization of deferred financing costs

     887        624   

Amortization of lease contracts above and below market value

     (979     (536

Compensation paid with Company common shares

     2,034        1,406   

Changes in operating assets and liabilities

    

Restricted cash

     155        223   

Rents and other receivables

     (3,129     (95

Deferred costs

     (175     (1,300

Prepaid expenses and other assets

     (3,329     (495

Accounts payable and accrued liabilities

     727        (1,524

Accrued interest payable

     11,658        11,681   

Prepaid rents and other liabilities

     2,139        (406
  

 

 

   

 

 

 

Net cash provided by operating activities

     40,193        33,385   
  

 

 

   

 

 

 

Cash flow from investing activities

    

Investments in real estate – development

     (22,410     (110,589

Interest capitalized for real estate under development

     (1,155     (6,254

Improvements to real estate

     (179     (437

Additions to non-real estate property

     (54     (63
  

 

 

   

 

 

 

Net cash used in investing activities

     (23,798     (117,343
  

 

 

   

 

 

 

Cash flow from financing activities

    

Issuance of preferred stock, net of offering costs

     62,696        97,482   

Line of credit:

    

Proceeds

     15,000        —     

Repayments

     (35,000     —     

Mortgage notes payable:

    

Repayments

     (1,300     (1,300

Return of escrowed proceeds

     —          1,104   

Exercises of stock options

     429        129   

Payments of financing costs

     (2,015     (155

Dividends and distributions:

    

Common shares

     (7,550     (7,179

Preferred shares

     (5,572     (3,723

Redeemable noncontrolling interests – operating partnership

     (2,287     (2,634
  

 

 

   

 

 

 

Net cash provided by financing activities

     24,401        83,724   
  

 

 

   

 

 

 

Net increase (decrease) in cash and cash equivalents

     40,796        (234

Cash and cash equivalents, beginning

     14,402        226,950   
  

 

 

   

 

 

 

Cash and cash equivalents, ending

   $ 55,198      $ 226,716   
  

 

 

   

 

 

 

Supplemental information:

    

Cash paid for interest

   $ 1,361      $ 2,233   
  

 

 

   

 

 

 

Deferred financing costs capitalized for real estate under development

   $ 76      $ 295   
  

 

 

   

 

 

 

Construction costs payable capitalized for real estate under development

   $ 7,299      $ 48,027   
  

 

 

   

 

 

 

Redemption of OP units for common shares

   $ 2,400      $ 21,500   
  

 

 

   

 

 

 

Adjustments to redeemable noncontrolling interests

   $ 5,107      $ 60,376   
  

 

 

   

 

 

 

 

- 8 -


DUPONT FABROS TECHNOLOGY, INC.

Operating Properties

As of March 31, 2012

 

Property

  

Property Location

  

Year Built/
Renovated

    

Gross
Building
Area
(2)

    

Raised
Square
Feet
(3)

    

Critical
Load
MW
(4)

    

%
Leased
(5)

   

%

Commenced
(5)

 

Stabilized (1)

                   

ACC2

   Ashburn, VA      2001/2005         87,000         53,000         10.4         100     100

ACC3

   Ashburn, VA      2001/2006         147,000         80,000         13.9         100     100

ACC4

   Ashburn, VA      2007         347,000         172,000         36.4         100     100

ACC5

   Ashburn, VA      2009-2010         360,000         176,000         36.4         100     100

CH1 Phase I

   Elk Grove Village, IL      2008         285,000         122,000         18.2         98     98

VA3

   Reston, VA      2003         256,000         147,000         13.0         100     100

VA4

   Bristow, VA      2005         230,000         90,000         9.6         100     100
        

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Subtotal— stabilized

        1,712,000         840,000         137.9         99     99

Completed not Stabilized

                   

NJ1 Phase I

   Piscataway, NJ      2010         180,000         88,000         18.2         36     36

ACC6 Phase I (6)

   Ashburn, VA      2011         131,000         66,000         13.0         8     8

SC1 Phase I

   Santa Clara, CA      2011         180,000         88,000         18.2         38     38

CH1 Phase II

   Elk Grove Village, IL      2012         200,000         109,000         18.2         79     57
        

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Subtotal— non-stabilized

        691,000         351,000         67.6         43     37
        

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

Total Operating Properties

        2,403,000         1,191,000         205.5         81     79
        

 

 

    

 

 

    

 

 

    

 

 

   

 

 

 

 

(1) Stabilized operating properties are either 85% or more leased or have been in service for 24 months or greater.
(2) Gross building area is the entire building area, including raised square footage (the portion of gross building area where the tenants’ computer servers are located), tenant common areas, areas controlled by the Company (such as the mechanical, telecommunications and utility rooms) and, in some facilities, individual office and storage space leased on an as available basis to the tenants.
(3) Raised square footage is that portion of gross building area where the tenants locate their computer servers. The Company considers raised square footage to be the net rentable square footage in each of its facilities.
(4) Critical load (also referred to as IT load or load used by tenants’ servers or related equipment) is the power available for exclusive use by tenants expressed in terms of megawatt, or MW, or kilowatt, or kW (1 MW is equal to 1,000 kW).
(5) Percentage leased is expressed as a percentage of critical load that is subject to an executed lease. Percentage commenced is expressed as a percentage of critical load where the lease has commenced under generally accepted accounting principles. Leases executed as of March 31, 2012 represent $213 million of base rent on a straight-line basis and $202 million on a cash basis over the next twelve months.
(6) As of April 26, 2012, ACC6 Phase I is 83% leased and 75% commenced.

 

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DUPONT FABROS TECHNOLOGY, INC.

Lease Expirations

As of March 31, 2012

The following table sets forth a summary schedule of lease expirations of the operating properties for each of the ten calendar years beginning with 2012. The information set forth in the table below assumes that tenants exercise no renewal options and takes into account tenants’ early termination options.

 

Year of Lease Expiration

   Number
of Leases
Expiring (1)
     Raised
Square Feet
Expiring
(in thousands) (2)
     % of Leased
Raised
Square Feet
    Total kW
of Expiring
Leases (3)
     % of
Leased kW
    % of
Annualized
Base Rent
 

2012(4)

     2         72         7.3     6,878         4.1     3.6

2013

     2         30         3.0     3,030         1.8     0.9

2014

     6         35         3.5     6,287         3.8     3.8

2015

     6         84         8.5     16,250         9.8     8.9

2016

     5         71         7.2     11,640         7.0     6.9

2017

     11         104         10.5     19,195         11.5     11.6

2018

     8         111         11.2     22,702         13.7     13.7

2019

     10         124         12.6     22,367         13.5     12.9

2020

     8         82         8.3     13,895         8.4     9.0

2021

     7         130         13.2     21,669         13.0     14.4

After 2021

     12         145         14.7     22,302         13.4     14.3
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Total

     77         988         100     166,215         100     100
  

 

 

    

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

 

(1) Represents 33 tenants with 77 lease expiration dates, including three leases that have not yet commenced for one existing tenant. Top three tenants represent 47% of annualized base rent as of March 31, 2012, excluding one tenant’s lease that expires on April 30, 2012.
(2) Raised square footage is that portion of gross building area where the tenants locate their computer servers. The Company considers raised square footage to be the net rentable square footage in each of its facilities.
(3) One MW is equal to 1,000 kW.
(4) One lease will expire on April 30, 2012, representing 67,000 raised square feet, 6.7% of leased raised square feet, 5,740 kW of critical load and 2.8% of annualized base rent as of March 31, 2012. The second lease has an option to terminate on six months notice.

 

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DUPONT FABROS TECHNOLOGY, INC.

Development Projects

As of March 31, 2012

($ in thousands)

 

Property

  

Property Location

  

Gross
Building
Area (1)

    

Raised
Square
Feet (2)

    

Critical
Load
MW (3)

    

Construction
in Progress &
Land Held for
Development (4)

 

Future Development Projects/Phases

           

SC1 Phase II

   Santa Clara, CA      180,000         88,000         18.2       $ 61,621   

NJ1 Phase II

   Piscataway, NJ      180,000         88,000         18.2         39,212   

ACC6 Phase II (5)

   Ashburn, VA      131,000         66,000         13.0         26,169   
     

 

 

    

 

 

    

 

 

    

 

 

 
        491,000         242,000         49.4         127,002   
     

 

 

    

 

 

    

 

 

    

 

 

 

Land Held for Development

              

ACC7 Phase I /II

   Ashburn, VA      360,000         176,000         36.4         10,052   

ACC8

   Ashburn, VA      100,000         50,000         10.4         3,693   

SC2 Phase I/II

   Santa Clara, CA      300,000         171,000         36.4         2,055   
     

 

 

    

 

 

    

 

 

    

 

 

 
        760,000         397,000         83.2         15,800   
     

 

 

    

 

 

    

 

 

    

 

 

 

Total

        1,251,000         639,000         132.6       $ 142,802   
     

 

 

    

 

 

    

 

 

    

 

 

 

 

(1) Gross building area is the entire building area, including raised square footage (the portion of gross building area where the tenants’ computer servers are located), tenant common areas, areas controlled by the Company (such as the mechanical, telecommunications and utility rooms) and, in some facilities, individual office and storage space leased on an as available basis to the tenants.
(2) Raised square footage is that portion of gross building area where the tenants locate their computer servers. The Company considers raised square footage to be the net rentable square footage in each of its facilities.
(3) Critical load (also referred to as IT load or load used by tenants’ servers or related equipment) is the power available for exclusive use by tenants expressed in terms of MW or kW (1 MW is equal to 1,000 kW).
(4) Amount capitalized as of March 31, 2012. Future Phase II development projects include only land, shell, underground work and capitalized interest through Phase I opening.
(5) As of April 26, 2012, ACC6 Phase II is 67% pre-leased and in development. Estimated total costs to build is $120 million.

 

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DUPONT FABROS TECHNOLOGY, INC.

Debt Summary as of March 31, 2012

($ in thousands)

 

    

Amounts

     % of Total     Rates (1)     Maturities
(years)
 

Secured

   $ 143,500         21     3.2     2.7   

Unsecured

     550,000         79     8.5     5.0   
  

 

 

    

 

 

   

 

 

   

 

 

 

Total

   $ 693,500         100     7.4     4.5   
  

 

 

    

 

 

   

 

 

   

 

 

 

Fixed Rate Debt:

         

Unsecured Notes

   $ 550,000         79     8.5     5.0   
  

 

 

    

 

 

   

 

 

   

 

 

 

Fixed Rate Debt

     550,000         79     8.5     5.0   
  

 

 

    

 

 

   

 

 

   

 

 

 

Floating Rate Debt:

         

Unsecured Credit Facility (2)

     —           —          —          4.0   

ACC5 Term Loan

     143,500         21     3.2     2.7   
  

 

 

    

 

 

   

 

 

   

 

 

 

Floating Rate Debt

     143,500         21     3.2     2.7   
  

 

 

    

 

 

   

 

 

   

 

 

 

Total

   $ 693,500         100     7.4     4.5   
  

 

 

    

 

 

   

 

 

   

 

 

 

 

Note: The Company capitalized interest and deferred financing cost amortization of $1.2 million during the three months ended March 31, 2012.

 

  (1) Rates as of March 31, 2012.
  (2) The Unsecured Credit Facility was amended in March 2012, decreasing the interest rate to LIBOR plus 1.85%, increasing the commitment to $225.0 million and extending the maturity date to March 2016 with a one-year extension option.

Debt Maturity as of March 31, 2012

($ in thousands)

 

Year

   Fixed Rate     Floating Rate     Total      % of Total     Rates (4)  

2012

     —          3,900 (2)      3,900         0.6     3.2

2013

     —          5,200 (2)      5,200         0.7     3.2

2014

     —          134,400 (2)      134,400         19.4     3.2

2015

     125,000 (1)      —          125,000         18.0     8.5

2016

     125,000 (1)      —   (3)      125,000         18.0     8.5

2017

     300,000 (1)      —          300,000         43.3     8.5
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Total

   $ 550,000      $ 143,500      $ 693,500         100     7.4
  

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

 

(1) The Unsecured Notes have mandatory amortizations of $125.0 million due in 2015, $125.0 million due in 2016 and $300.0 million due in 2017.
(2) The ACC5 Term Loan matures on December 2, 2014 with no extension option and requires quarterly principal payments of $1.3 million through maturity.
(3) The Unsecured Credit Facility was amended in March 2012, decreasing the interest rate to LIBOR plus 1.85%, increasing the commitment to $225.0 million and extending the maturity date to March 2016 with a one-year extension option.
(4) Rates as of March 31, 2012.

 

- 12 -


DUPONT FABROS TECHNOLOGY, INC.

Selected Unsecured Debt Metrics

 

     3/31/12     12/31/11  

Interest Coverage Ratio (not less than 2.0)

     3.6        3.5   

Total Debt to Gross Asset Value (not to exceed 60%)

     24.9     26.3

Secured Debt to Total Assets (not to exceed 40%)

     5.2     5.3

Total Unsecured Assets to Unsecured Debt (not less than 150%)

     343.9     329.5

These selected metrics relate to DuPont Fabros Technology, LP’s outstanding unsecured debt. DuPont Fabros Technology, Inc. is the general partner of DuPont Fabros Technology, LP.

Capital Structure as of March 31, 2012

(in thousands except per share data)

 

Mortgage Notes Payable

           $ 143,500      

Unsecured Notes

             550,000      
          

 

 

    

Total Debt

             693,500         22.7

Common Shares

     77     63,098            

Operating Partnership (“OP”) Units

     23     18,967            
  

 

 

   

 

 

          

Total Shares and Units

     100     82,065            

Common Share Price at March 31, 2012

     $ 24.45            
    

 

 

          

Common Share and OP Unit Capitalization

        $ 2,006,489         

Preferred Stock ($25 per share liquidation preference)

          351,250         
       

 

 

       

Total Equity

             2,357,739         77.3
          

 

 

    

 

 

 

Total Market Capitalization

           $ 3,051,239         100.0
          

 

 

    

 

 

 

 

- 13 -


DUPONT FABROS TECHNOLOGY, INC.

Common Share and OP Unit

Weighted Average Amounts Outstanding

 

    

Q1 2012

    

Q1 2011

 

Weighted Average Amounts Outstanding for EPS Purposes:

     

Common Shares – basic

     62,568,547         60,210,596   

Shares issued from assumed conversion of:

     

- Restricted Shares

     206,609         335,378   

- Stock Options

     772,942         836,316   
  

 

 

    

 

 

 

Total Common Shares - diluted

     63,548,098         61,382,290   
  

 

 

    

 

 

 

Weighted Average Amounts Outstanding for FFO and AFFO Purposes:

     

Common Shares – basic

     62,568,547         60,210,596   

OP Units – basic

     19,005,397         21,000,721   
  

 

 

    

 

 

 

Total Common Shares and OP Units

     81,573,944         81,211,317   

Shares and OP Units issued from assumed conversion of:

     

- Restricted Shares

     206,609         335,378   

- Stock Options

     772,942         836,316   
  

 

 

    

 

 

 

Total Common Shares and Units - diluted

     82,553,495         82,383,011   
  

 

 

    

 

 

 

Period Ending Amounts Outstanding:

     

Common Shares

     63,098,510      

OP Units

     18,966,881      
  

 

 

    

Total Common Shares and Units

     82,065,391      
  

 

 

    

 

- 14 -


DUPONT FABROS TECHNOLOGY, INC.

2012 Guidance as of April 26, 2012

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

 

     Expected Q2 2012
per share
     Expected 2012
per share
 

Net income per common share and unit – diluted

   $ 0.08 to $0.10       $ 0.37 to $0.46   

Depreciation and amortization, net

     0.27         1.07 to 1.08   
  

 

 

    

 

 

 

FFO per share – diluted (1)

   $ 0.35 to $0.37       $ 1.44 to $1.54   
  

 

 

    

 

 

 

2012 Debt Assumptions

 

Weighted average debt outstanding

   $ 692.5 million   

Weighted average interest rate

     7.58%       

Total interest costs

   $ 52.5 million   

Amortization of deferred financing costs

     3.7 million   

Interest expense capitalized

     (3.5) million   

Deferred financing costs amortization capitalized

     (0.2) million   
  

 

 

 

Total interest expense after capitalization

   $ 52.5 million   

2012 Other Guidance Assumptions

 

Total revenues

   $320 to $340 million

Base rent (included in total revenues)

   $220 to $230 million

Straight-line revenues (included in base rent)

   $18 to $25 million

General and administrative expense

   $18 million

Investments in real estate – development (2)

   $100 million

Improvements to real estate excluding development

   $4 million

Preferred stock dividends

   $27 million

Annualized common stock dividend

   $0.60 per share

Weighted average common shares and OP units - diluted

   83 million

 

(1) For information regarding FFO, see “Reconciliations of Net Income to FFO and AFFO” above.
(2) Includes CH1 Phase II completion costs and $65 million of 2012 cash to build ACC6 Phase II.

 

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