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11/01/17
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NOT FOR DISTRIBUTION TO ANY PERSON LOCATED OR RESIDENT IN ANY JURISDICTION WHERE IT IS UNLAWFUL TO DISTRIBUTE THIS ANNOUNCEMENT.

Interxion Reports Third Quarter 2017 Results

18% Year over Year Revenue Growth and Strong Bookings Driven by Growing Demand across Our Target Segments

AMSTERDAM--(BUSINESS WIRE)--Nov. 1, 2017-- Interxion Holding NV (NYSE:INXN), a leading European provider of carrier and cloud-neutral colocation data centre services, announced its results today for the three months ended 30 September 2017.

Financial Highlights

  • Revenue increased by 18% to €124.6 million (3Q 2016: €105.3 million).
  • Recurring revenue1 increased by 17% to €117.4 million (3Q 2016: €100.0 million).
  • Net income decreased by 4% to €10.1 million (3Q 2016: €10.5 million).
  • Adjusted net income2 increased by 24% to €10.7 million (3Q 2016: €8.6 million).
  • Earnings per diluted share decreased to €0.14 (3Q 2016: €0.15).
  • Adjusted earnings2 per diluted share increased to €0.15 (3Q 2016: €0.12).
  • Adjusted EBITDA2 increased by 16% to €56.2 million (3Q 2016: €48.3 million).
  • Adjusted EBITDA margin decreased to 45.1% (3Q 2016: 45.9%).
  • Capital expenditures, including intangible assets3, were €75.2 million (3Q 2016: €64.5 million).

Operating Highlights

  • Equipped space4 increased by 1,900 square metres in the quarter to 118,900 square metres.
  • Revenue generating space4 increased by 2,100 square metres in the quarter to 97,100 square metres.
  • Utilisation rate at the end of the quarter was 82%.
  • During the third quarter, Interxion completed the following major expansions:
    • 1,100 sqm expansion in Frankfurt,
    • 300 sqm expansion in Stockholm, and
    • 400 sqm expansion in Zurich.

“Interxion delivered strong financial and operational results in the third quarter, with 18% revenue growth year-over-year, driven by 21% revenue growth in our Big 4 markets and 14% growth in the Rest of Europe,” said David Ruberg, Interxion’s Chief Executive Officer. “Strong and well diversified bookings in the quarter confirmed the value of our communities of interest and reflect the growing demand that we are experiencing across our European footprint and in our target segments. Consequently, we are increasing our full year revenue guidance and narrowing Adjusted EBITDA guidance to the top end of our previously announced range.”

Quarterly Review

Revenue in the third quarter of 2017 was €124.6 million, an 18% increase over the third quarter of 2016 and a 3% increase over the second quarter of 2017. Recurring revenue was €117.4 million, a 17% increase over the third quarter of 2016 and a 3% increase over the second quarter of 2017. Recurring revenue in the third quarter represented 94% of total revenue. On an organic constant currency5 basis, revenue in the third quarter of 2017 was 17% higher than in the third quarter of 2016 and 4% higher than in the second quarter of 2017.

Cost of sales in the third quarter of 2017 was €49.6 million, a 22% increase over the third quarter of 2016 and a 4% increase over the second quarter of 2017.

Gross profit was €75.0 million in the third quarter of 2017, a 16% increase over the third quarter of 2016 and a 3% increase over the second quarter of 2017. Gross profit margin was 60.2% in the third quarter of 2017, compared with 61.3% in the third quarter of 2016 and 60.3% in the second quarter of 2017.

Sales and marketing costs in the third quarter of 2017 were €8.2 million, a 13% increase over the third quarter of 2016 and flat compared to the second quarter of 2017.

Other general and administrative costs, which exclude depreciation, amortisation, impairments, share-based payments and M&A transaction costs were €10.6 million in the third quarter of 2017, a 19% increase over the third quarter of 2016 and a 3% increase from the second quarter of 2017.

Depreciation, amortisation, and impairments in the third quarter of 2017 was €27.8 million, a 26% increase from the third quarter of 2016 and a 2% increase from the second quarter of 2017.

Operating income in the third quarter of 2017 was €25.0 million, an increase of 6% from the third quarter of 2016 and flat compared to the second quarter of 2017.

Net finance expense for the third quarter of 2017 was €10.8 million, a 26% increase over the third quarter of 2016 and a 1% decrease over the second quarter of 2017.

Income tax expense for the third quarter of 2017 was €4.1 million, a 9% decrease compared with the third quarter of 2016 and an 11% increase from the second quarter of 2017.

Net income was €10.1 million in the third quarter of 2017, a 4% decrease over the third quarter of 2016 and a 3% decrease from the second quarter of 2017.

Adjusted net income was €10.7 million in the third quarter of 2017, a 24% increase over the third quarter of 2016 and a 5% increase from the second quarter of 2017.

Adjusted EBITDA for the third quarter of 2017 was €56.2 million, a 16% increase over the third quarter of 2016 and a 3% increase over the second quarter of 2017.

Adjusted EBITDA margin was 45.1% in the third quarter of 2017, compared with 45.9% in the third quarter of 2016 and 45.0% in the second quarter of 2017.

Net cash flows from operating activities were €32.5 million in the third quarter of 2017, compared with €23.2 million in the third quarter of 2016 and €35.7 million in the second quarter of 2017.

Cash generated from operations6, was €55.2 million in the third quarter of 2017, compared with €43.5 million in the third quarter of 2016 and €40.6 million in the second quarter of 2017.

Capital expenditures, including intangible assets, were €75.2 million in the third quarter of 2017, compared with €64.5 million in the third quarter of 2016 and €56.4 million in the second quarter of 2017.

Cash and cash equivalents were €38.2 million at 30 September 2017, compared with €115.9 million at year end 2016.

Total borrowings, net of deferred revolving facility financing fees, were €806.8 million at 30 September 2017, compared with €735.0 million at year end 2016.

All of the capacity metrics below do not include Interxion Science Park.

Equipped space at the end of the third quarter of 2017 was 118,900 square metres, compared with 107,800 square metres at the end of the third quarter of 2016 and 117,000 square metres at the end of the second quarter of 2017.

Revenue generating space at the end of the third quarter of 2017 was 97,100 square metres, compared with 84,100 square metres at the end of the third quarter of 2016 and 95,000 square metres at the end of the second quarter of 2017.

Utilisation rate, the ratio of revenue-generating space to equipped space, was 82% at the end of the third quarter of 2017, compared with 78% at the end of the third quarter of 2016 and 81% at the end of the second quarter of 2017.

Land Purchase in Frankfurt; Expansion in Dublin and Zurich

Interxion today announced the expansion of its Frankfurt campus footprint and the further build out of its DUB3 and ZUR1 data centres.

In Frankfurt, Interxion has expanded its campus footprint by purchasing a parcel of land which can accommodate a data centre of over 7,000 square metres of equipped space. The capital expenditure associated with the Frankfurt land purchase is approximately €10 million.

In Dublin, Interxion will expand its DUB3 data centre by constructing an additional 1,200 square metres of equipped space and adding approximately 1 MW of customer available power. The additional 1,200 square metres of equipped space at DUB3 is scheduled to open in the third quarter of 2018. Capital expenditure associated with the incremental space and power for DUB3 is expected to be approximately €17 million.

In Zurich, Interxion will expand its ZUR1 data centre by constructing an additional 400 square meters of equipped space, which is scheduled to become operational in the first quarter of 2018. The capital expenditure associated with this expansion is expected to be approximately €2 million.

The anticipated 2017 capital expenditure associated with the Frankfurt land purchase and the two data centre expansions is included in the 2017 capital expenditure guidance provided by the Company today.

Business Outlook

Interxion is updating its guidance for full year 2017, increasing its full year revenue guidance, narrowing Adjusted EBITDA guidance to the top end of its previously announced range, and reaffirming capital expenditures (including intangibles) guidance:

  Prior Guidance   Revised Guidance
(in millions) (in millions)
Revenue €468 – €483 €485 – €489
Adjusted EBITDA €212 – €222 €220 – €222
Capital expenditures (including intangibles) €250 – €270 €250 – €270
 

Capital expenditure guidance does not include €77.5 million for the acquisition of Interxion Science Park in 1Q 2017.

Conference Call to Discuss Results

Interxion will host a conference call today at 8:30 a.m. EDT (12:30 p.m. GMT, 1:30 p.m. CET) to discuss the results.

To participate on this call, U.S. callers may dial toll free 1-866-966-9439; callers outside the U.S. may dial direct +44 (0) 1452 555 566. The conference ID for this call is INXN. This event also will be webcast live over the Internet in listen-only mode at investors.interxion.com.

A replay of this call will be available shortly after the call concludes and will be available until 14 November 2017. To access the replay, U.S. callers may dial toll free 1-866-247-4222; callers outside the U.S. may dial direct +44 (0) 1452 550 000. The replay access number is 94232527.

Forward-looking Statements

This communication contains forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such forward-looking statements. Factors that could cause actual results and future events to differ materially from Interxion’s expectations include, but are not limited to, the difficulty of reducing operating expenses in the short term, the inability to utilise the capacity of newly planned data centres and data centre expansions, significant competition, the cost and supply of electrical power, data centre industry over-capacity, performance under service level agreements, certain other risks detailed herein and other risks described from time to time in Interxion’s filings with the United States Securities and Exchange Commission (the “SEC”).

Interxion does not assume any obligation to update the forward-looking information contained in this report.

Non-IFRS Financial Measures

Included in these materials are certain non-IFRS financial measures, which are measures of our financial performance that are not calculated and presented in accordance with IFRS, within the meaning of applicable SEC rules. These measures are as follows: (i) EBITDA; (ii) Adjusted EBITDA; (iii) Recurring revenue; (iv) Revenue on an organic constant currency basis; (v) Adjusted net income; (vi) Adjusted basic earnings per share, (vii) Adjusted diluted earnings per share and (viii) Cash generated from operations.

Other companies may present EBITDA, Adjusted EBITDA, Recurring revenue, Revenue on an organic constant currency basis, Adjusted net income, Adjusted basic earnings per share, Adjusted diluted earnings per share and Cash generated from operations differently than we do. Each of these measures are not measures of financial performance under IFRS and should not be considered as an alternative to operating income or as a measure of liquidity or an alternative to Profit for the period attributable to shareholders (“net income”) as indicators of our operating performance or any other measure of performance implemented in accordance with IFRS.

EBITDA, Adjusted EBITDA, Recurring revenue and Revenue on an organic constant currency basis

We define EBITDA as net income plus income tax expense, net finance expense, depreciation, amortisation and impairment of assets.

We define Adjusted EBITDA as EBITDA adjusted for the following items, which may occur in any period, and which management believes are not representative of our operating performance:

  • Share-based payments – primarily the fair value at the date of grant to employees of equity awards, are recognised as an employee expense over the vesting period. We believe that this expense does not represent our operating performance.
  • Income or expense related to the evaluation and execution of potential mergers or acquisitions (“M&A”) – under IFRS, gains and losses associated with M&A activity are recognised in the period in which such gains or losses are incurred. We exclude these effects because we believe they are not reflective of our ongoing operating performance.
  • Adjustments related to terminated and unused data centre sites – these gains and losses relate to historical leases entered into for certain brownfield sites, with the intention of developing data centres, which were never developed and for which management has no intention of developing into data centres. We believe the impact of gains and losses related to unused data centres are not reflective of our business activities and our on-going operating performance.

In certain circumstances, we may also adjust for other items that management believes are not representative of our current on-going performance. Examples include: adjustments for the cumulative effect of a change in accounting principle or estimate, impairment losses, litigation gains and losses or windfall gains and losses.

We define Recurring revenue as revenue incurred from colocation and associated power charges, office space, amortised set-up fees, cross-connects and certain recurring managed services (but excluding any ad hoc managed services) provided by us directly or through third parties, excluding rents received for the sublease of unused sites.

We believe EBITDA and Adjusted EBITDA and Recurring revenue provide useful supplemental information to investors regarding our on-going operational performance. These measures help us and our investors evaluate the on-going operating performance of the business after removing the impact of our capital structure (primarily interest expense) and our asset base (primarily depreciation and amortisation). Management believes that the presentation of Adjusted EBITDA, when combined with the primary IFRS presentation of net income, provides a more complete analysis of our operating performance. Management also believes the use of EBITDA and Adjusted EBITDA facilitates comparisons between us and other data centre operators (including other data centre operators that are REITs) and other infrastructure based businesses. EBITDA and Adjusted EBITDA are also relevant measures used in the financial covenants of our €100.0 million revolving credit facility, our €100.0 million senior secured revolving facility and our 6.00% Senior Secured Notes due 2020.

A reconciliation from net income to EBITDA and from EBITDA to Adjusted EBITDA is provided in the tables attached to this press release. EBITDA, Adjusted EBITDA and other key performance indicators may not be indicative of our historical results of operations, nor are they meant to be predictive of future results.

We believe that revenue growth is a key indicator of how a company is progressing from period to period and presenting organic constant currency information for revenue provides useful supplemental information to investors regarding our ongoing operational performance because it helps us and our investors evaluate the ongoing operating performance of the business after removing the impact of acquisitions and of currency exchange rates.

Adjusted net income, Adjusted basic earnings per share and Adjusted diluted earnings per share

We define Adjusted net income as net income adjusted for the following items and the related income tax effect, which may occur in any period, and which management believes are not reflective of our operating performance:

  • Income or expense related to the evaluation and execution of potential mergers or acquisitions (“M&A”) – under IFRS, gains and losses associated with M&A activity are recognised in the period in which such gains or losses are incurred. We exclude these effects because we believe they are not reflective of our on-going operating performance.
  • Adjustments related to provisions – these adjustments are made for adjustments in provisions that are not reflective of the on-going operating performance of Interxion. These adjustments may include changes in provisions for onerous lease contracts.
  • Adjustments related to capitalised interest – under IFRS, we are required to calculate and capitalise interest allocated to the investment in data centres and exclude it from net income. We believe that reversing the impact of capitalised interest provides information about the impact of the total interest costs and facilitates comparisons with other data centre operators.

In certain circumstances, we may also adjust for items that management believes are not representative of our current on-going performance. Examples include: adjustments for the cumulative effect of a change in accounting principle or estimate, impairment losses, litigation gains and losses or windfall gains and losses.

Management believe that the exclusion of certain items listed above, provides useful supplemental information to net income to aid investors in evaluating the operating performance of our business and comparing our operating performance with other data centre operators and infrastructure companies. We believe the presentation of Adjusted net income, when combined with net income (loss) prepared in accordance with IFRS is beneficial to a complete understanding of our performance. A reconciliation from reported net income to Adjusted net income is provided in the tables attached to this press release.

Adjusted basic earnings per share and Adjusted diluted earnings per share amounts are determined on Adjusted net income.

Cash generated from operations

Cash generated from operations is defined as net cash flows from operating activities, excluding interest and corporate income tax payments and receipts. Management believe that the exclusion of these items, provides useful supplemental information to net cash flows from operating activities to aid investors in evaluating the cash generating performance of our business.

The company’s outlook for 2017 included in this press release, includes a range for expected Adjusted EBITDA, a non-IFRS financial measure, which excludes items that management believes are not representative of our operating performance. These items include, but are not limited to, share-based payments, income or expense related to the evaluation and execution of potential mergers or acquisitions, adjustments related to terminated and unused data centre sites, and other significant items that currently cannot be predicted. The exact amount of these items is not currently determinable, but may be significant. Accordingly, the company is unable to provide equivalent reconciliations from the corresponding forward-looking IFRS measures to expected Adjusted EBITDA.

About Interxion

Interxion (NYSE:INXN) is a leading provider of carrier and cloud-neutral colocation data centre services in Europe, serving a wide range of customers through 48 data centres in 11 European countries. Interxion’s uniformly designed, energy efficient data centres offer customers extensive security and uptime for their mission-critical applications.

With over 600 connectivity providers, 21 European Internet exchanges, and most leading cloud and digital media platforms across its footprint, Interxion has created connectivity, cloud, content and finance hubs that foster growing customer communities of interest. For more information, please visit www.interxion.com.

This announcement contains inside information under Regulation (EU) 596/2014 (16 April 2014).

1 Recurring revenue is revenue incurred from colocation and associated power charges, office space, amortised set-up fees, cross-connects and certain recurring managed services (but excluding any ad hoc managed services) provided by us directly or through third parties, excluding rents received for the sublease of unused sites.

2 Adjusted net income (or ‘Adjusted earnings’) and Adjusted EBITDA are non-IFRS figures intended to adjust for certain items and are not measures of financial performance under IFRS. Complete definitions can be found in the “Non-IFRS Financial Measures” section in this press release. Reconciliations of net income to Adjusted EBITDA and net income to Adjusted net income can be found in the financial tables later in this press release.

3 Capital expenditures, including intangible assets, represent payments to acquire property, plant, equipment and intangible assets, as recorded in the consolidated statement of cash flows as "Purchase of property, plant and equipment" and "Purchase of intangible assets", respectively.

4 Equipped space and Revenue generating space (and other metrics derived from these measures) exclude Interxion Science Park, which was acquired on 24 February 2017.

5 We present organic constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of acquisitions and foreign currency rate fluctuations. For purposes of calculating Revenue on an organic constant currency basis, results from entities acquired during the current and comparison period are excluded. Also, current and comparative prior period results for entities reporting in currencies other than Euro are converted into Euro using the average exchange rates from the prior period rather than the actual exchange rates in effect during the current period. The reconciliation of total revenue growth to total revenue growth on an organic constant currency basis, is as follows:

Three Months Ended 30 September 2017   Year-on-year   Sequential
 
Reported total revenue growth 18.4% 3.2%
Add back: impact of foreign currency translation 0.8% 0.6%
Reverse: impact of acquired ISP business -1.8% 0.0%
Total revenue growth on an organic constant currency basis 17.4% 3.7%
 
Percentages may not add due to rounding
 

6 We define Cash generated from operations as net cash flows from operating activities, excluding interest and corporate income tax payments and receipts.

       
INTERXION HOLDING NV
CONDENSED CONSOLIDATED INCOME STATEMENTS
(in €'000 ― except per share data and where stated otherwise)
(unaudited)
 
Three Months Ended Nine Months ended
Sep-30 Sep-30 Sep-30 Sep-30
2017 2016 2017 2016
 
Revenue 124,647 105,275 359,420 311,301
Cost of sales (49,608 ) (40,765 ) (141,628 ) (119,547 )
Gross Profit 75,039 64,510 217,792 191,754
Other income - 12 27 142
Sales and marketing costs (8,247 ) (7,293 ) (24,458 ) (22,301 )
General and administrative costs (41,766 ) (33,619 ) (118,947 ) (99,572 )
               
Operating income 25,026 23,610 74,414 70,023
Net finance expense (10,833 ) (8,628 ) (32,040 ) (26,756 )
               
Profit or loss before income taxes 14,193 14,982 42,374 43,267
Income tax expense (4,131 ) (4,521 ) (11,158 ) (13,422 )
Net income 10,062   10,461   31,216   29,845  
 
Basic earnings per share(a): (€) 0.14 0.15 0.44 0.42
Diluted earnings per share(b): (€) 0.14 0.15 0.44 0.42
 
 
Number of shares outstanding at the end of the period (shares in thousands) 71,327 70,527 71,327 70,527
Weighted average number of shares for Basic EPS (shares in thousands) 71,195 70,528 71,004 70,286
Weighted average number of shares for Diluted EPS (shares in thousands) 71,891 71,463 71,701 71,188
 
 
As at
Sep-30 Sep-30
Capacity metrics 2017 2016
Equipped space (in square meters) (c) 118,900 107,800

Revenue generating space (in square meters) (c)

97,100 84,100
Utilization rate 82 % 78 %
 
(a) Basic earnings per share are calculated as net income divided by the weighted average number of shares for Basic EPS.
(b) Diluted earnings per share are calculated as net income divided by the weighted average number of shares for Diluted EPS.

(c) Equipped space and Revenue generating space (and other metrics derived from these measures) exclude Interxion Science Park, which was acquired on February 24, 2017.

 
       
INTERXION HOLDING NV
NOTES TO CONDENSED CONSOLIDATED INCOME STATEMENTS: SEGMENT INFORMATION
(in €'000 ― except where stated otherwise)
(unaudited)
 
Three Months Ended Nine Months ended
Sep-30 Sep-30 Sep-30 Sep-30
2017 2016 2017 2016

Consolidated

 
Recurring revenue 117,392 99,987 339,094 296,528
Non-recurring revenue 7,255   5,288   20,326   14,773  
Revenue 124,647   105,275   359,420   311,301  
Net income 10,062 10,461 31,216 29,845
Net income margin 8.1 % 9.9 % 8.7 % 9.6 %
Operating income 25,026 23,610 74,414 70,023
Operating income margin 20.1 % 22.4 % 20.7 % 22.5 %
Adjusted EBITDA 56,200   48,331   161,850   141,596  
Gross profit margin 60.2 % 61.3 % 60.6 % 61.6 %
Adjusted EBITDA margin 45.1 % 45.9 % 45.0 % 45.5 %
 
Total assets 1,620,036 1,457,055 1,620,036 1,457,055
Total liabilities 1,034,037 921,269 1,034,037 921,269
Capital expenditure, including intangible assets(a) (75,158 ) (64,526 ) (186,356 ) (177,120 )
 

France, Germany, the Netherlands, and the UK

 
Recurring revenue 76,554 63,809 220,736 189,847
Non-recurring revenue 4,279   3,073   12,348   8,958  
Revenue 80,833 66,882 233,084 198,805
Operating income 24,186 21,937 72,956 65,993
Operating income margin 29.9 % 32.8 % 31.3 % 33.2 %
Adjusted EBITDA 43,414   36,776   126,697   109,969  
Gross profit margin 61.0 % 62.6 % 61.6 % 62.8 %
Adjusted EBITDA margin 53.7 % 55.0 % 54.4 % 55.3 %
 
Total assets 1,156,329 949,085 1,156,329 949,085
Total liabilities 242,646 194,390 242,646 194,390
Capital expenditure, including intangible assets(a) (51,593 ) (43,489 ) (127,412 ) (123,873 )
 

Rest of Europe

 
Recurring revenue 40,838 36,178 118,358 106,681
Non-recurring revenue 2,976   2,215   7,978   5,815  
Revenue 43,814   38,393   126,336   112,496  
Operating income 18,315 15,974 51,467 46,325
Operating income margin 41.8 % 41.6 % 40.7 % 41.2 %
Adjusted EBITDA 25,914   22,366   73,610   65,455  
Gross profit margin 65.8 % 65.2 % 65.9 % 65.9 %
Adjusted EBITDA margin 59.1 % 58.3 % 58.3 % 58.2 %
 
Total assets 388,447 348,314 388,447 348,314
Total liabilities 79,875 77,799 79,875 77,799
Capital expenditure, including intangible assets(a) (21,243 ) (18,514 ) (51,095 ) (45,185 )
 

Corporate and other

 
Operating income (17,475 ) (14,301 ) (50,009 ) (42,295 )
Adjusted EBITDA (13,128 ) (10,811 ) (38,457 ) (33,828 )
 
Total assets 75,260 159,656 75,260 159,656
Total liabilities 711,516 649,080 711,516 649,080
Capital expenditure, including intangible assets(a) (2,322 ) (2,523 ) (7,849 ) (8,062 )
 

(a) Capital expenditure, including intangible assets, represents payments to acquire property, plant and equipment and intangible assets,as recorded in the condensed consolidated statements of cash flows as "Purchase of property, plant and equipment" and "Purchase of intangible assets", respectively.

 
       
INTERXION HOLDING NV
NOTES TO CONDENSED CONSOLIDATED INCOME STATEMENTS: ADJUSTED EBITDA RECONCILIATION
(in €'000 ― except where stated otherwise)
(unaudited)
 
Three Months Ended Nine Months ended
Sep-30 Sep-30 Sep-30 Sep-30
2017 2016 2017 2016
 

Reconciliation to Adjusted EBITDA

 

Consolidated

 
Net income 10,062 10,461 31,216 29,845
Income tax expense 4,131   4,521   11,158   13,422  
Profit before taxation 14,193 14,982 42,374 43,267
Net finance expense 10,833   8,628   32,040   26,756  
Operating income 25,026 23,610 74,414 70,023
Depreciation, amortisation and impairments 27,790   22,094   79,183   65,592  
EBITDA(1) 52,816 45,704 153,597 135,615
Share-based payments 1,751 1,752 5,319 4,515
Income or expense related to the evaluation and execution of potential mergers or acquisitions:
M&A transaction costs(2) 1,633 887 2,961 1,608
Items related to terminated or unused data centre sites:
Items related to sub-leases on unused data centre sites(3) - (12 ) (27 ) (142 )
        -   -  
Adjusted EBITDA(1) 56,200   48,331   161,850   141,596  
 

France, Germany, the Netherlands, and the UK

 
Operating income 24,186 21,937 72,956 65,993
Depreciation, amortisation and impairments 18,788   14,782   52,783   43,617  
EBITDA(1) 42,974 36,719 125,739 109,610
Share-based payments 440 69 985 501
Items related to terminated or unused data centre sites:
Items related to sub-leases on unused data centre sites(3) -   (12 ) (27 ) (142 )
Adjusted EBITDA(1) 43,414   36,776   126,697   109,969  
 

Rest of Europe

 
Operating income 18,315 15,974 51,467 46,325
Depreciation, amortisation and impairments 7,475   6,288   21,819   18,818  
EBITDA(1) 25,790 22,262 73,286 65,143
Share-based payments 124   104   324   312  
Adjusted EBITDA(1) 25,914   22,366   73,610   65,455  
 

Corporate and Other

 
Operating income (17,475 ) (14,301 ) (50,009 ) (42,295 )
Depreciation, amortisation and impairments 1,527   1,024   4,581   3,157  
EBITDA(1) (15,948 ) (13,277 ) (45,428 ) (39,138 )
Share-based payments 1,187 1,579 4,010 3,702
Income or expense related to the evaluation and execution of potential mergers or acquisitions:
M&A transaction costs(2) 1,633   887   2,961   1,608  
Adjusted EBITDA(1) (13,128 ) (10,811 ) (38,457 ) (33,828 )
 

(1) “EBITDA” and “Adjusted EBITDA” are non-IFRS financial measures. See “Non-IFRS Financial Measures” for more information on these measures, including why we believe that these supplemental measures are useful, and the limitations on the use of these supplemental measures.

(2) “M&A transaction costs” are costs associated with the evaluation, diligence and conclusion or termination of merger or acquisition activity. These costs are included in “General and administrative costs”.

(3) “Items related to sub-leases on unused data centre sites” represents the income on sub-lease of portions of unused data centre sites to third parties. This income is treated as ‘Other income’.

 
   
INTERXION HOLDING NV
CONDENSED CONSOLIDATED BALANCE SHEET
(in €'000 ― except where stated otherwise)
(unaudited)
 
As at
Sep-30 Dec-31
2017 2016
Non-current assets
Property, plant and equipment 1,277,166 1,156,031
Intangible assets 59,448 28,694
Goodwill 38,900 -
Deferred tax assets 25,751 20,370
Other investments 3,246 1,942
Other non-current assets 14,461   11,914  
1,418,972 1,218,951
Current assets
Trade receivables and other current assets 162,860 147,821
Cash and cash equivalents 38,204   115,893  
201,064   263,714  
Total assets 1,620,036   1,482,665  
 
Shareholders’ equity
Share capital 7,132 7,060
Share premium 530,315 519,604
Foreign currency translation reserve 5,163 9,988
Hedging reserve, net of tax (187 ) (243 )
Accumulated profit 43,576   12,360  
585,999 548,769
Non-current liabilities
Other non-current liabilities 14,659 11,718
Deferred tax liabilities 21,985 9,628
Borrowings 716,749   723,975  
753,393 745,321
Current liabilities
Trade payables and other current liabilities 183,170 171,399
Income tax liabilities 7,165 5,694
Borrowings 90,309   11,482  
280,644   188,575  
Total liabilities 1,034,037   933,896  
Total liabilities and shareholders’ equity 1,620,036   1,482,665  
 
   
INTERXION HOLDING NV
NOTES TO THE CONDENSED CONSOLIDATED BALANCE SHEET: BORROWINGS
(in €'000 ― except where stated otherwise)
(unaudited)
 
As at
Sep-30 Dec-31
2017 2016
 

Borrowings net of cash and cash equivalents

 
Cash and cash equivalents 38,204   115,893  
 
6.00% Senior Secured Notes due 2020(a) 628,437 629,327
Mortgages 52,541 54,412
Financial leases 51,280 51,718
Other borrowings(b) 74,800   -  
Borrowings excluding Revolving Facility deferred financing costs 807,058   735,457  
Revolving Facility deferred financing costs(c) (290 ) (426 )
Total borrowings 806,768   735,031  
       
Borrowings net of cash and cash equivalents 768,564   619,138  
 
(a) €625 million 6.00% Senior Secured Notes due 2020 include a premium on the additional issuance and are shown after deducting underwriting discounts and commissions, offering fees and expenses.
(b) On 28 July 2017, we amended the terms of our €75.0 million senior secured revolving facility agreement dated 9 March 2017 to increase the amount available under the facility to €100.0 million and to add a second extension option enabling us to extend the maturity of this credit facility to 31 December 2018. Also, on 31 July 2017, we extended the maturity of our €100.0 million senior multicurrency revolving facility agreement dated 17 June 2013 from 3 July 2018 to 31 December 2018.
(c) Deferred financing costs of €0.3 million as of 30 September 2017 were incurred in connection with the €100 million revolving facility.
 
       
INTERXION HOLDING NV
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in €'000 ― except where stated otherwise)
(unaudited)
 
Three Months Ended Nine Months ended
Sep-30 Sep-30 Sep-30 Sep-30
2017 2016((b)) 2017 2016((b))
 
Net income 10,062 10,461 31,216 29,845
Depreciation, amortisation and impairments 27,790 22,094 79,183 65,592
Provision for onerous lease contracts - (261 ) - (1,532 )
Share-based payments 1,443 1,845 4,012 4,403
Net finance expense 10,833 8,628 32,040 26,756
Income tax expense 4,131   4,521   11,158   13,422  
54,259 47,288 157,609 138,486
Movements in trade receivables and other assets (266 ) (4,956 ) (13,654 ) (3,646 )
Movements in trade payables and other liabilities 1,212   1,135   14,793   (1,623 )
Cash generated from / (used in) operations 55,205 43,467 158,748 133,217
Interest and fees paid(a) (19,476 ) (18,357 ) (40,389 ) (33,779 )
Interest received 193 44 140 69
Income tax paid (3,439 ) (1,948 ) (8,744 ) (5,486 )
Net cash flows from / (used in) operating activities 32,483 23,206 109,755 94,021
Cash flows from / (used in) investing activities
Purchase of property plant and equipment (73,708 ) (61,041 ) (180,030 ) (169,217 )
Financial investments - deposits 30 416 (336 ) 1,164
Acquisition Interxion Science Park B.V. - - (77,517 ) -
Purchase of intangible assets (1,450 ) (3,485 ) (6,326 ) (7,903 )
Loans provided - (1,942 ) (1,341 ) (1,942 )
Proceeds from sale of financial asset -   281   -   281  
Net cash flows from / (used in) investing activities (75,128 ) (65,771 ) (265,550 ) (177,617 )
Cash flows from / (used in) financing activities
Proceeds from exercised options 2,682 44 6,771 6,220
Proceeds from mortgages - - - 14,625
Repayment of mortgages (624 ) (548 ) (2,045 ) (1,816 )
Proceeds from revolving credit facilities 30,000 - 104,775 -
Repayment Revolving facilities - - (30,000 ) -
Proceeds Senior secured notes at 6% - - - 155,346
Interest received at issue of additional notes -   -   -   2,225  
Net cash flows from / (used in) financing activities 32,058 (504 ) 79,501 176,600
Effect of exchange rate changes on cash (452 ) (187 ) (1,395 ) (592 )
Net increase / (decrease) in cash and cash equivalents (11,039 ) (43,256 ) (77,689 ) 92,412
Cash and cash equivalents, beginning of period 49,243   189,354   115,893   53,686  
Cash and cash equivalents, end of period 38,204   146,098   38,204   146,098  
 
(a) Interest and fees paid is reported net of cash interest capitalised, which is reported as part of “Purchase of property, plant and equipment".
(b) The collaterized cash has been reclassified from ”Cash and cash equivalents” to ”Other current assets” and ”Other non-current assets”. The impact on the consolidated statement of cash flows has been presented in investing cash flows. Comparative figures have been adjusted accordingly.
 
       
INTERXION HOLDING NV
NOTES TO CONDENSED CONSOLIDATED INCOME STATEMENTS: ADJUSTED NET INCOME RECONCILIATION
(in €'000 ― except per share data and where stated otherwise)
(unaudited)
 
Three Months Ended Nine Months ended
Sep-30 Sep-30 Sep-30 Sep-30
2017 2016 2017 2016
 
Net income - as reported 10,062 10,461 31,216 29,845
 
Add back
+ M&A transaction costs 1,633   887   2,961   1,608  
1,633 887 2,961 1,608
Reverse
- Profit on sale of financial asset - (281 ) - (281 )
- Adjustment of financial lease obligation - (1,410 ) - (1,410 )
- Interest capitalised (840 ) (1,255 ) (2,605 ) (2,421 )
(840 ) (2,946 ) (2,605 ) (4,112 )
 
Tax effect of above add backs & reversals (198 ) 162 (89 ) 274
               
Adjusted net income 10,657   8,564   31,483   27,615  
 
Reported basic EPS: (€) 0.14 0.15 0.44 0.42
Reported diluted EPS: (€) 0.14 0.15 0.44 0.42
 
Adjusted basic EPS: (€) 0.15 0.12 0.44 0.39
Adjusted diluted EPS: (€) 0.15 0.12 0.44 0.39
 
       
INTERXION HOLDING NV
Status of Announced Expansion Projects as at 1 November 2017
with Target Open Dates after 1 July 2017
 
CAPEX Equipped
((a)(b)) Space ((a))
Market Project (€ million) (sqm) Target Opening Dates
 
Dublin DUB3: Phases 3 - 4 17 1,200 3Q 2018
Frankfurt FRA11: Phases 1 - 4 New Build 95 4,800 4Q 2017 - 2Q 2018 (c)
Frankfurt FRA12: New Build 19 1,100 3Q 2017
Frankfurt FRA13: Phases 1 - 2 New Build 90 4,900 4Q 2018 - 1Q 2019 (d)
London LON3: New Build 35 1,800 3Q 2018
Marseille MRS2: Phases 1 - 2 New Build 76 4,300 3Q 2017 - 4Q 2018(e)
Stockholm STO5: Phase 1 New Build 11 600 3Q 2017 - 4Q 2017 (f)
Vienna VIE2: Phases 7 - 8 45 2,300 4Q 2017 -3Q 2018(g)
Zurich ZUR1: Phase 3 (cont.) - 4 3 800 3Q17 - 1Q 2018 (h)
Total € 391 21,800
 
(a) CAPEX and Equipped space are approximate and may change. Figures are rounded to nearest 100 sqm unless otherwise noted. Totals may not add due to rounding.
(b) CAPEX reflects the total spend for the projects listed at full power and capacity and the amounts shown in the table above may be invested over the duration of more than one fiscal year.
(c) FRA11: Phases 1 and 2 (1,200 square metres each) are scheduled to become operational in 4Q 2017; phases 3 & 4 (1,200 square metres each) are scheduled to become operational in 2Q 2018.
(d) FRA13: Phase 1 (2,300 square metres) is scheduled to become operational in 4Q 2018; phase 2 (2,600 square metres) is scheduled to become operational in 1Q 2019.
(e) MRS2: 100 sqm became operational in 3Q 2017. 700 square metres is scheduled to become operational in 2Q 2018; 1,900 square metres is scheduled to become operational in 4Q 2018. Further phases have not yet been announced.
(f) STO5: 300 sqm became operational in 3Q 2017; 300 sqm is scheduled to become operational in 4Q 2017.
(g) VIE2: 300 square metres is scheduled to become operational in 4Q 2017; 700 square metres is scheduled to become operational in 2Q 2018; 600 square metres is scheduled to become operational in 3Q 2018. Further phases have not yet been announced.
(h) ZUR1: 400 square metres became operational in 3Q 2017; 400 square metres is scheduled to become operational in 1Q 2018.

Source: Interxion Holding NV

Interxion Holding NV
Investor Relations:
Jim Huseby, +1 813-644-9399
IR@interxion.com