Digital Realty's CEO Discusses Q4 2011 Results - Earnings Call Transcript
Digital Realty Trust, Inc. (DLR)
Q4 2011 Earnings Call
February 17, 2012 - 01:00 p.m. ET
Executives
Michael F. Foust – Chief Executive Officer
A. William Stein – Chief Financial Officer and Chief Investment Officer
Pamela M. Garibaldi – Vice President, Investor Relations and Corporate Marketing
Analysts
Jordan Sadler – KeyBanc Capital Markets, Inc.
Paul B. Morgan – Morgan Stanley & Co., LLC
James C. Feldman – Bank of America Merrill Lynch
Emmanuel Korchman – Citigroup Global Markets, Inc.
George D. Auerbach – ISI Group, Inc.
Tayo T. Okusanya – Jefferies & Co., Inc.
Vincent Chao – Deutsche Bank
William A. Crow – Raymond James & Associates, Inc.
Lukas Hartwich – Green Street Advisors, Inc.
Gabriel Hilmoe – UBS Securities, LLC
Jonathan Schildkraut – Evercore Partners, Inc.
Chris R. Lucas – Robert W. Baird & Co., Inc.
Presentation
Operator
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Good afternoon. My name is Sarah and I will be your conference operator today. At this time, I would like to welcome everyone to the Digital Realty 2011 fourth quarter earnings conference call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. (Operator Instructions)
I would now like to turn the call over to Ms. Pamela Garibaldi, Vice President, Investor Relations and Corporate Marketing. Ms. Garibaldi, you may begin your conference.
Pamela M. Garibaldi
Thank you, Sarah. Good morning and good afternoon to everyone. By now you should have received a copy of the Digital Realty earnings press release. If you have not, you can access one in the 'Investors' section of our website at www.digitalrealty.com, or you may call 415-738-6500 to request a copy.
Before we begin, I'd like to remind everyone that the management of Digital Realty may make forward-looking statements on this call that are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially from expectations. You can identify forward-looking statements by the use of forward-looking terminology, such as believes, expects, may, will, should, pro forma or similar words or phrases.
You can also identify forward-looking statements by discussions of strategy, plans, intentions, future events or trends, or discussions that do not relate solely to historical matters, including such statements that relate to our dividend policy, rents to be received in the future periods and lease terms, development and redevelopment plans, supply and demand for data center space, targeted returns and cap rates, acquisitions and investment activities, capital markets and finance activities, and the company's future financial and other results, including the company's 2012 guidance and underlying assumptions.
For a further discussion of the risks and uncertainties related to our business, see the company's Annual Report filed on Form 10-K for the year ended December 31, 2010 and subsequent filings with the SEC, including the company's quarterly reports on Form 10-Q. The company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Additionally, this call will contain non-GAAP financial information, including: funds from operations, or FFO; adjusted funds from operations, or AFFO; core funds from operations; earnings before interest, taxes, depreciation and amortization, or EBITDA; adjusted EBITDA; same-store net operating income, or NOI; and same-store cash or NOI.
Digital Realty is providing this information as a supplement to information prepared in accordance with generally accepted accounting principles. Explanations of such non-GAAP items and reconciliations to net income are contained in the company's supplemental operating and financial data package for the fourth quarter of 2011 furnished to the SEC, and this information is available on the company's website at
.
Now, I'd like to introduce Michael Foust, CEO; and Bill Stein, CFO and Chief Investment Officer. Following management's remarks, we will open the call to your questions. Questions will be limited to one per caller. If you have additional questions, please feel free to return to the queue.
I will now turn the call over to Mike.
Michael F. Foust
Thank you, Pamela and welcome to the call everyone. Before we get start with our formal remarks, I would like to thank everyone who participated in our Investor Day a few weeks ago. We greatly appreciate the positive feedback we received, and we are glad you found the information useful. Now I'll proceed with the call. I will begin with my remarks and then turn the call over to Bill who will review our exceptional fourth quarter and full-year 2011 financial results.
As we previously announced, 2011 was a record setting year for DLR. We signed new leases for approximately 1.3 million square feet, representing over $136.6 million of annual GAAP rental revenue, which represents a 22% increase over 2010. We were able to achieve these results by leveraging our global platform and expanding relationships with several multinational customers in markets ranging from Amsterdam to Dallas and Silicon Valley to Singapore.
We also achieved excellent results serving the local customer base in markets such as Paris, Los Angeles, and Melbourne, Australia. We believe that the strength of our leasing program lies in our geographically diverse portfolio, supported by local experts who deliver service and solutions to customers with a consistent commitment to excellence regardless of location. At the same time, our global portfolio enables us to provide data center solutions where our customers need them while mitigating our exposure in any one geographic market.
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