Interxion Reports Third Quarter 2016 Results

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 2016.

Financial Highlights
  • Revenue increased by 7% to €105.3 million (3Q 2015: €98.0 million).
  • Recurring revenue 1 increased by 8% to €100.0 million (3Q 2015: €92.8 million).
  • Net income increased to €10.5 million (3Q 2015: €10.4 million).
  • Adjusted net income 2 decreased by 1% to €8.6 million (3Q 2015: €8.7 million).
  • Earnings per diluted share were €0.15 (3Q 2015: €0.15).
  • Adjusted earnings per diluted share decreased by 2% to €0.12 (3Q 2015: €0.12).
  • Adjusted EBITDA 2 increased by 11% to €48.3 million (3Q 2015: €43.7 million).
  • Adjusted EBITDA margin increased to 45.9% (3Q 2015: 44.6%).
  • Capital expenditures 3, including intangible assets, were €64.5 million (3Q 2015: €35.3 million).

Operating Highlights
  • Equipped space increased by 3,600 square metres in the quarter to 107,800 square metres.
  • Revenue generating space increased by 2,500 square metres in the quarter to 84,100 square metres.
  • Utilisation rate at the end of the quarter was 78%.
  • During the third quarter, Interxion completed a 2,400 sqm expansion in FRA10 in Frankfurt, an 800 sqm expansion at MRS1 in Marseille, and a 300 sqm expansion at VIE2 in Vienna.

"Once again, Interxion had solid quarterly results with 10% constant currency revenue growth and 130 basis points of Adjusted EBITDA margin expansion year over year. The strong level of bookings that we experienced in the first half of 2016 continued through the third quarter, and our current sales pipeline remains robust," said David Ruberg, Interxion's Chief Executive Officer. "We continue to experience strong demand across multiple industry segments and all deal sizes. We are experiencing this demand in multiple geographies, as evidenced by our order-driven capacity expansions in 9 of our 13 markets during 2016 and further expansions in 2017."

Quarterly Review

Revenue in the third quarter of 2016 was €105.3 million, a 7% increase over the third quarter of 2015 and a 1% increase over the second quarter of 2016. Recurring revenue was €100.0 million, an 8% increase over the third quarter of 2015 and a 1% increase over the second quarter of 2016. Recurring revenue in the third quarter was 95% of total revenue. On a constant currency basis 4, revenue and recurring revenue in the third quarter 2016 were both 10% higher than the third quarter of 2015.

Cost of sales in the third quarter of 2016 was €40.8 million, a 6% increase over the third quarter of 2015 and a 3% increase over the second quarter of 2016.

Gross profit was €64.5 million in the third quarter of 2016, an 8% increase over the third quarter of 2015 and a slight increase over the second quarter of 2016. Gross profit margin was 61.3% in the third quarter of 2016 compared with 60.7% in the third quarter of 2015 and 61.9% in the second quarter of 2016.

Sales and marketing costs in the third quarter of 2016 were €7.3 million, a 5% increase over the third quarter of 2015 and a slight increase from the second quarter of 2016.

Other general and administrative costs, which exclude depreciation, amortisation, impairments, share-based payments, M&A transaction costs and provision for onerous lease contracts, were €8.9 million in the third quarter of 2016, a 1% increase over the third quarter of 2015 and a 9% decrease from the second quarter of 2016.

Depreciation, amortisation, and impairments in the third quarter of 2016 was €22.1 million, an increase of 9% from the third quarter of 2015 and a slight increase from the second quarter of 2016.

Operating income in the third quarter of 2016 was €23.6 million, an increase of 10% from the third quarter of 2015 and a slight increase from the second quarter of 2016.

Net finance expense for the third quarter of 2016 was €8.6 million, a 35% increase over the third quarter of 2015 and a 15% decrease over the second quarter of 2016. Included in third quarter 2016 net finance expense was a €1.3 million positive adjustment on finance lease obligations, lowering net finance expense. A sale of a financial asset was completed in the third quarter 2016, resulting in a €0.3 million gain compared to €2.3 million gain in the third quarter 2015.

Income tax expense for the third quarter of 2016 was €4.5 million, a 5% decrease compared with the third quarter of 2015 and a 7% increase from the second quarter of 2016.

Net income was €10.5 million in the third quarter of 2016, a slight increase over the third quarter of 2015 and a 14% increase from the second quarter of 2016.

Adjusted net income was €8.6 million in the third quarter of 2016, a 1% decrease over the third quarter of 2015, and a 5% decrease from the second quarter of 2016.

Adjusted EBITDA for the third quarter of 2016 was €48.3 million, an 11% increase over the third quarter of 2015 and a 2% increase over the second quarter of 2016. Adjusted EBITDA margin was 45.9% in the third quarter of 2016 compared to 44.6% in the third quarter of 2015 and 45.5% in the second quarter of 2016.

Cash generated from operations, defined as cash generated from operating activities before interest and corporate income tax payments and receipts, was €41.5 million in the third quarter of 2016, compared to €43.0 million in the third quarter of 2015, and €39.3 million in the second quarter of 2016.

Capital expenditures, including intangible assets, were €64.5 million in the third quarter of 2016 compared to €35.3 million in the third quarter of 2015 and €62.6 million in the second quarter of 2016.

Cash and cash equivalents were €149.8 million at 30 September 2016, compared to €58.6 million at year end 2015. Total borrowings, net of deferred revolving facility financing fees, were €737.2 million at 30 September 2016 compared to €555.1 million at year end 2015. As of 30 September 2016, the Company's revolving credit facility was undrawn.

Equipped space at the end of the third quarter of 2016 was 107,800 square metres compared to 100,200 square metres at the end of the third quarter of 2015 and 104,200 square metres at the end of the second quarter of 2016. Utilisation rate, the ratio of revenue-generating space to equipped space, was 78% at the end of the third quarter of 2016, compared with 78% at the end of the third quarter of 2015 and 78% at the end of the second quarter of 2016.

Business Outlook

Interxion today reaffirms guidance for its revenue, adjusted EBITDA and capital expenditures (including intangibles) for full year 2016:
Revenue   €416 million - €431 million
Adjusted EBITDA €185 million - €195 million
Capital expenditures (including intangibles) €260 million - €280 million
 

Conference Call to Discuss Results

Interxion will host a conference call today at 8:30 a.m. ET (12:30 pm GMT, 1:30 pm CET) to discuss its Third Quarter 2016 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 15 November 2016. 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 92466336.

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) revenue on a constant currency basis, (iv) recurring revenue; (v) recurring revenue on a constant currency basis (vi) adjusted net income; (vii) adjusted basic earnings per share and (viii) adjusted diluted earnings per share.

Other companies may present EBITDA, adjusted EBITDA, revenue on a constant currency basis, recurring revenue, recurring revenue on a constant current basis, adjusted net income, adjusted basic earnings per share and adjusted diluted earnings per share 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, revenue on a constant currency basis, recurring revenue and recurring revenue on a 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, is 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 incurred. We exclude these effects because we believe they are not reflective of our ongoing operating performance.
  • Adjustments related to terminated and unused datacentre sites - these gains and losses relate to historical leases entered into for certain brownfield sites, with the intention of developing datacentres, 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 datacentres are not reflective of our business activities and our ongoing operating performance.

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

We believe EBITDA and adjusted EBITDA provide 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 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 and 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 million revolving facility and our 6.00% Senior Secured Notes due 2020.

A reconciliation from net income to EBITDA and EBITDA to adjusted EBITDA is provided in the tables attached to this press release.

Recurring revenue comprises revenue that is incurred monthly from colocation, connectivity and associated power charges, office space, amortized set-up fees and certain recurring managed services (but excluding any ad hoc managed services) provided by us directly or through third parties. Rents received for the sublease of unused sites are excluded. We present recurring revenue as we believe it assists investors understand our operating performance.

We present constant currency information for revenue and recurring revenue to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, 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.

We believe that revenue growth is a key indicator of how a company is progressing from period to period and presenting constant currency information for revenue and recurring 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 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 incurred. We exclude these effects because we believe they are not reflective of our ongoing operating performance.
  • Adjustments related to provisions - these adjustments are made for adjustments in provisions that are not reflective of the ongoing 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 ongoing performance. Examples of this would include: adjusting 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 to aid investors compare 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.

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

Interxion does not provide forward-looking estimates of net income, operating income, depreciation, amortisation, and impairments, share-based payments, M&A transaction costs or increase/decrease in provision for onerous lease contracts, and income from sub-leases of unused data centre sites, which it uses to reconcile to adjusted EBITDA. The Company is, therefore, unable to provide forward-looking reconciling information for adjusted EBITDA.

A reconciliation from reported net income to adjusted net income is provided in the tables attached to this press release.

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 42 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 that is 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. Rents received for the sublease of unused sites are excluded.

2 Adjusted net income and adjusted EBITDA are non-IFRS figures intended to adjust for certain items and are not measures of financial performance under IFRS. Full 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, and 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 We present constant currency information for revenue and recurring revenue to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, 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.
       
INTERXION HOLDING NV
CONDENSED CONSOLIDATED INCOME STATEMENTS
(in €'000 ¿ except per share data and where stated otherwise)
(unaudited)
 
Three Months Ended For the nine months ended
Sep-30 Sep-30 Sep-30 Sep-30
2016 2015 2016 2015
Revenue 105,275 97,976 311,301 285,907
Cost of sales (40,765 ) (38,464 ) (119,547 ) (112,409 )
Gross Profit 64,510 59,512 191,754 173,498
Other income 12 142 142 21,202
Sales and marketing costs (7,293 ) (6,943 ) (22,301 ) (20,832 )
General and administrative costs (33,619 ) (31,152 ) (99,572 ) (101,135 )
               
Operating income 23,610 21,559 70,023 72,733
Net Finance expense (8,628 ) (6,407 ) (26,756 ) (20,938 )
               
Profit or loss before income taxes 14,982 15,152 43,267 51,795
Income tax expense (4,521 ) (4,737 ) (13,422 ) (15,368 )
Net income 10,461   10,415   29,845   36,427  
 
Basic earnings per share: (€) 0.15 0.15 0.42 0.52
Diluted earnings per share: (€) 0.15 0.15 0.42 0.52
 
 
Number of shares outstanding at the end of the period (shares in thousands) 70,527 69,638 70,527 69,638
Weighted average number of shares for Basic EPS (shares in thousands) 70,528 69,619 70,286 69,526
Weighted average number of shares for Diluted EPS (shares in thousands) 71,463 70,612 71,188 70,561
 
 
As at
Sep-30 Sep-30

Capacity metrics
2016 2015
Equipped space (in square meters) 107,800 100,200
Revenue generating space (in square meters) 84,100 78,000
Utilization Rate 78 % 78 %
 
       
INTERXION HOLDING NV
NOTES TO CONDENSED CONSOLIDATED INCOME STATEMENTS: SEGMENT INFORMATION
(in €'000 ¿ except where stated otherwise)
(unaudited)
 
Three Months Ended For the nine months ended
Sep-30 Sep-30 Sep-30 Sep-30
2016 2015 2016 2015
Consolidated
 
Recurring revenue 99,987 92,753 296,528 270,101
Non-recurring revenue 5,288   5,223   14,773   15,806  
Revenue 105,275   97,976   311,301   285,907  
Net income 10,461 10,415 29,845 36,427
Net income margin 9.9 % 10.6 % 9.6 % 12.7 %
Operating income 23,610 21,559 70,023 72,733
Operating income margin 22.4 % 22.0 % 22.5 % 25.4 %
Adjusted EBITDA 48,331   43,732   141,596   126,366  
Gross profit margin 61.3 % 60.7 % 61.6 % 60.7 %
Adjusted EBITDA margin 45.9 % 44.6 % 45.5 % 44.2 %
 
Total assets 1,457,055 1,208,485 1,457,055 1,208,485
Total liabilities 921,269 719,963 921,269 719,963

Capital expenditure, including intangible assets (a)
(64,526 ) (35,270 ) (177,120 ) (150,675 )
 
France, Germany, the Netherlands, and the UK
 
Recurring revenue 63,809 59,461 189,847 171,765
Non-recurring revenue 3,073   3,758   8,958   10,380  
Revenue 66,882 63,219 198,805 182,145
Operating income 21,937 21,714 65,993 61,516
Operating income margin 32.8 % 34.3 % 33.2 % 33.8 %
Adjusted EBITDA 36,776   34,907   109,969   99,525  
Gross profit margin 62.6 % 62.3 % 62.8 % 62.3 %
Adjusted EBITDA margin 55.0 % 55.2 % 55.3 % 54.6 %
 
Total assets 949,085 852,020 949,085 852,020
Total liabilities 194,390 175,537 194,390 175,537
Capital expenditure, including intangible assets (a) (43,489 ) (26,624 ) (123,873 ) (96,935 )
 
Rest of Europe
 
Recurring revenue 36,178 33,292 106,681 98,336
Non-recurring revenue 2,215   1,465   5,815   5,426  
Revenue 38,393   34,757   112,496   103,762  
Operating income 15,974 13,464 46,325 40,017
Operating income margin 41.6 % 38.7 % 41.2 % 38.6 %
Adjusted EBITDA 22,366   19,784   65,455   58,104  
Gross profit margin 65.2 % 64.3 % 65.9 % 64.2 %
Adjusted EBITDA margin 58.3 % 56.9 % 58.2 % 56.0 %
 
Total assets 348,314 308,934 348,314 308,934
Total liabilities 77,799 57,150 77,799 57,150
Capital expenditure, including intangible assets (a) (18,514 ) (6,022 ) (45,185 ) (49,436 )
 
Corporate and other
 
Operating income (14,301 ) (13,619 ) (42,295 ) (28,800 )
Adjusted EBITDA (10,811 ) (10,959 ) (33,828 ) (31,263 )
 
Total assets 159,656 47,531 159,656 47,531
Total liabilities 649,080 487,276 649,080 487,276
Capital expenditure, including intangible assets (a) (2,523 ) (2,624 ) (8,062 ) (4,304 )
 
 

(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 For the nine months ended
Sep-30 Sep-30 Sep-30 Sep-30
2016 2015 2016 2015
Reconciliation to Adjusted EBITDA
 
Consolidated
 
Net income 10,461 10,415 29,845 36,427
Income tax expense 4,521   4,737   13,422   15,368  
Profit before taxation 14,982 15,152 43,267 51,795
Net finance expense 8,628   6,407   26,756   20,938  
Operating income 23,610 21,559 70,023 72,733
Depreciation, amortisation and impairments 22,094   20,251   65,592   58,043  
EBITDA (1) 45,704 41,810 135,615 130,776
Share-based payments 1,752 1,664 4,515 5,694

Income or expense related to the evaluation and execution of potential mergers or acquisitions
M&A transaction break fee income (2) - - - (20,923 )
M&A transaction costs (3) 887 484 1,608 11,282
Items related to terminated or unused data centre sites:
Increase/(decrease) in provision for onerous lease contracts (4) - (84 ) - (184 )
Income from sub-leases on unused data centre sites (5) (12 ) (142 ) (142 ) (279 )
Adjusted EBITDA (1) 48,331   43,732   141,596   126,366  
 
France, Germany, the Netherlands, and the UK
 
Operating income 21,937 21,714 65,993 61,516
Depreciation, amortisation and impairments 14,782   13,066   43,617   37,327  
EBITDA (1) 36,719 34,780 109,610 98,843
Share-based payments 69 353 501 1,145
Items related to terminated or unused data centre sites:
Increase/(decrease) in provision for onerous lease contracts (4) - (84 ) - (184 )
Income from sub-leases on unused data centre sites (5) (12 ) (142 ) (142 ) (279 )
Adjusted EBITDA (1) 36,776   34,907   109,969   99,525  
 
Rest of Europe
 
Operating income 15,974 13,464 46,325 40,017
Depreciation, amortisation and impairments 6,288   6,113   18,818   17,475  
EBITDA (1) 22,262 19,577 65,143 57,492
Share-based payments 104   207   312   612  
Adjusted EBITDA (1) 22,366   19,784   65,455   58,104  
 
Corporate and Other
 
Operating income (14,301 ) (13,619 ) (42,295 ) (28,800 )
Depreciation, amortisation and impairments 1,024   1,072   3,157   3,241  
EBITDA (1) (13,277 ) (12,547 ) (39,138 ) (25,559 )
Share-based payments 1,579 1,104 3,702 3,937

Income or expense related to the evaluation and execution of potential mergers or acquisitions
M&A transaction break fee income (2) - - - (20,923 )
M&A transaction costs (3) 887   484   1,608   11,282  
Adjusted EBITDA (1) (10,811 ) (10,959 ) (33,828 ) (31,263 )
 
(1) "EBITDA" and "Adjusted EBITDA" are non-IFRS financial measures within the meaning of the rules of the SEC. 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 break fee income" represents the cash break up fee received following the termination of the Implementation Agreement in May 2015. This fee was included in "Other income."

(3) "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." In the quarter ended 30 September 2016, M&A transaction costs included €0.9 million related to other activity including the evaluation of potential asset acquisitions.

(4) "Increase/(decrease) in provision for onerous lease contracts" relates to those contracts in which we expect losses to be incurred in respect of unused data centre sites over the term of the lease contract.

(5) "Income from sub-leases of 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
2016 2015
Non-current assets
Property, plant and equipment 1,108,458 999,072
Intangible assets 28,203 23,194
Deferred tax assets 19,668 23,024
Financial assets 1,890 -
Other non-current assets 7,125   6,686  
1,165,344 1,051,976
Current assets
Trade receivables and other current assets 141,909 141,534
Cash and cash equivalents 149,802   58,554  
291,711   200,088  
Total assets 1,457,055   1,252,064  
 
Shareholders' equity
Share capital 7,053 6,992
Share premium 517,858 507,296
Foreign currency translation reserve 8,854 20,865
Hedging reserve, net of tax (301 ) (213 )
Accumulated income / (deficit) 2,322   (27,523 )
535,786 507,417
Non-current liabilities
Trade payables and other liabilities 11,514 12,049
Deferred tax liabilities 8,871 9,951
Borrowings 733,027   550,812  
753,412 572,812
Current liabilities
Trade payables and other liabilities 157,703 162,629
Income tax liabilities 5,465 2,738
Provision for onerous lease contracts - 1,517
Borrowings 4,689   4,951  
167,857   171,835  
Total liabilities 921,269   744,647  
Total liabilities and shareholders' equity 1,457,055   1,252,064  
 
   
INTERXION HOLDING NV
NOTES TO THE CONDENSED CONSOLIDATED BALANCE SHEET: BORROWINGS
(in €'000 ¿ except where stated otherwise)
(unaudited)
 
As at
Sep-30 Dec-31
2016 2015
Borrowings net of cash and cash equivalents
 
Cash and cash equivalents (a) 149,802   58,554  
 

6.00% Senior Secured Notes due 2020 (b)
629,600 475,503
Mortgages 56,594 44,073
Financial leases 51,522 34,582
Other borrowings -   1,605  
Borrowings excluding Revolving Facility deferred financing costs 737,716   555,763  

Revolving Facility deferred financing costs (c)
(497 ) (710 )
Total borrowings 737,219   555,053  
       
Borrowings net of cash and cash equivalents 587,417   496,499  
 
 

(a) Cash and cash equivalents include €3.7 million as of 30 September 2016 and €4.9 million as of 31 December 2015, which is restricted and held as collateral to support the issuance of bank guarantees on behalf of a number of subsidiary companies.

(b) €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.

(c) Deferred financing costs of €0.5 million as of 30 September 2016 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 For the nine months ended
Sep-30 Sep-30 Sep-30 Sep-30
2016 2015 2016 2015
Net income 10,461 10,415 29,845 36,427
Depreciation, amortisation and impairments 22,094 20,251 65,592 58,043
Provision for onerous lease contracts (261 ) (879 ) (1,532 ) (2,653 )

Share-based payments
1,845 1,664 4,403 5,694
Net finance expense 8,628 6,407 26,756 20,938
Income tax expense 4,521   4,737   13,422   15,368  
47,288 42,595 138,486 133,817
Movements in trade receivables and other current assets (6,898 ) (216 ) (5,588 ) (9,581 )
Movements in trade payables and other liabilities 1,135   584   (1,623 ) 7,067  
Cash generated from operations 41,525 42,963 131,275 131,303
Interest and fees paid (a) (18,357 ) (14,107 ) (33,779 ) (29,129 )
Interest received 44 37 69 117
Other financial items - - - -
Income tax paid (1,948 ) (4,107 ) (5,486 ) (9,167 )
Net cash flows from / (used in) operating activities 21,264 24,786 92,079 93,124
Cash flows from investing activities
Purchase of property plant and equipment (61,041 ) (33,399 ) (169,217 ) (145,628 )
Purchase of intangible assets (3,485 ) (1,871 ) (7,903 ) (5,047 )
Proceeds from sale of financial asset 281 3,063 281 3,063
Redemption of short-term investments -       -   1,650  
Net cash flows from / (used in) investing activities (64,245 ) (32,207 ) (176,839 ) (145,962 )
Cash flows from financing activities
Proceeds from exercised options 44 12 6,220 2,420
Proceeds from mortgages - - 14,625 -
Repayment of mortgages (548 ) (320 ) (1,816 ) (1,360 )
Proceeds Senior secured notes at 6% - - 155,346 -
Interest received at issue of additional notes - - 2,225 -
Repayment of other borrowings - (31 ) - (31 )
Net cash flows from / (used in) financing activities (504 ) (339 ) 176,600 1,029
Effect of exchange rate changes on cash (187 ) 692   (592 ) 1,916  
Net increase / (decrease) in cash and cash equivalents (43,672 ) (7,068 ) 91,248 (49,893 )
Cash and cash equivalents, beginning of period 193,474   57,098   58,554   99,923  
Cash and cash equivalents, end of period 149,802   50,030   149,802   50,030  
 
(a) Interest paid is reported net of cash interest capitalised, which is reported as part of "Purchase of property, plant and equipment".
 
       
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 For the nine months ended
Sep-30 Sep-30 Sep-30 Sep-30
2016 2015 2016 2015
Net income - as reported 10,461 10,415 29,845 36,427
 
Add back
+ M&A transaction costs 887   484   1,608   11,282  
887 484 1,608 11,282
Reverse
- M&A transaction break fee income - - - (20,923 )
- Profit on sale of financial asset (281 ) (2,289 ) (281 ) (2,289 )
- Adjustment of financial lease obligation (1,410 ) - (1,410 ) -
- Increase / (decrease) in provision for onerous lease contracts - (84 ) - (184 )
- Interest capitalised (1,255 ) (426 ) (2,421 ) (2,026 )
(2,946 ) (2,799 ) (4,112 ) (25,422 )
 
Tax effect of above add backs & reversals 162 579 274 3,535
               
Adjusted net income 8,564   8,679   27,615   25,822  
 
Reported basic EPS: (€) 0.15 0.15 0.42 0.52
Reported diluted EPS: (€) 0.15 0.15 0.42 0.52
 
Adjusted basic EPS: (€) 0.12 0.12 0.39 0.37
Adjusted diluted EPS: (€) 0.12 0.12 0.39 0.37
 
       
INTERXION HOLDING NV
Status of Announced Expansion Projects as at 2 November 2016
with Target Open Dates after 1 January 2016
 
Market   Project  

CAPEX (a)(b) (€ million)
 

Equipped Space (a) (sqm)
  Target Opening Dates
 
Amsterdam AMS 8: Phases 1 - 2 New Build 50 2,700

4Q 2016 - 1Q 2017 (c)
Copenhagen CPH2: Phases 1 - 2 New Build 19 1,100 2Q 2016 - 1Q 2017 (d)
Dublin DUB3: Phases 1 - 2 New Build 28 1,200 4Q 2016
Dusseldorf DUS 2: Phase 1 - 2 New Build 16 1,200 4Q 2015 - 2Q 2016 (e)
Frankfurt FRA 10: Phases 1 - 4 New Build 92 4,800 1Q 2016 - 3Q 2016 (f)
Frankfurt FRA 11: Phases 1 - 4 New Build 95 4,800 4Q 2017 - 2Q 2018 (g)
Marseille MRS 1: Phase 2 (cont) - 3 30 2,200 3Q 2016 - 2Q 2017 (h)
Paris PAR7: Phase 2 37 2,100 4Q 2016 - 2Q 2017 (i)
Vienna VIE 2: New Build 65 4,200 4Q 2014 - 2Q 2017 (j)
Total € 432 24,300
 
(a) CAPEX and Equipped space are approximate and may change. Figures are rounded to nearest 100 sqm unless otherwise noted.
(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) Phase 1 (1,400 square metres) is scheduled to become operational in 4Q 2016. Phase 2 (1300 square metres) is scheduled to become operational in 1Q 2017.
(d) Phase 1 (500 square metres) became operational in 2Q 2016. Phase 2 (600 square metres) is scheduled to become operational in 1Q 2017.
(e) Phase 1 (600 square metres) became operational in 4Q 2015. Phase 2 (600 square metres) became operational in 2Q 2016.
(f) Phase 1 (1,200 square metres) became operational in 1Q 2016; phase 2 (1,200 square metres) became operational in 2Q 2016; phases 3 & 4 (1,200 square metres each) became operational in 3Q 2016.
(g) 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.
(h) Phase 2 (cont.) (800 square metres) became operational in 3Q 2016. Phase 3 (1,400 square metres) is scheduled to become operational in 2Q 2017.
(i) The first 500 square metres is scheduled to become operational in 4Q 2016. The remaining 1,600 square metres is scheduled to become operational in 2Q 2017.
(j) 1,300 square metres became operational in 4Q 2014; 600 square metres became operational in 1Q 2015; 600 square metres became operational in 2Q 2015; 300 square metres became operational in 4Q 2015; 300 sqm became operational in 3Q 2016; another 1,100 square metres is scheduled to become operational in 2Q 2017.

View source version on businesswire.com: http://www.businesswire.com/news/home/20161102005740/en/

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