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DuPont Fabros Technology, Inc. Reports Fourth Quarter 2012 Results



      DuPont Fabros Technology, Inc. Reports Fourth Quarter 2012 Results

Revenues up 16%

ACC6 Phase II opens at 100% Leased

PR Newswire

WASHINGTON, Feb. 6, 2013

WASHINGTON, Feb. 6, 2013 /PRNewswire/ -- DuPont Fabros Technology, Inc. (NYSE:
DFT) today reported results for the quarter ended December 31, 2012. All per
share results are reported on a fully diluted basis.

(Logo: http://photos.prnewswire.com/prnh/20120104/MM29780LOGO )

Highlights

  o At year-end, the company's overall operating portfolio was 90% leased with
    the stabilized portfolio at 90% leased, the two properties remaining in
    the non-stabilized portfolio at 88% leased and the one completed
    development, ACC6 Phase II, 100% leased.
  o Quarterly Highlights:

       o Reported fourth quarter Funds from Operations ("FFO") of $0.38 per
         share representing a 2.7% increase over the prior year quarter. 
       o Increased the quarterly dividend by 33% from $0.15 per share to $0.20
         per share. 
       o Signed five leases totaling 13.62 megawatts ("MW") and 73,582 raised
         square feet. 
       o Commenced two leases totaling 1.00 MW and 5,500 raised square feet.
       o As reported in the third quarter earnings release, extended the
         maturity of one lease totaling 13.90 MW and 80,000 raised square feet
         by 8.2 years.  This lease is now scheduled to expire from 2024 to
         2026. 

Hossein Fateh, President and Chief Executive Officer, said, "The volume of new
leasing in 2012 was the best in our history.  In 2012, we signed 14 new leases
totaling 41.5 MW of critical load and four lease extensions totaling 23.8 MW
of critical load. Three of the four lease extensions were with tenants who
also signed 16.1 MW of new leases in 2012.  Also, on January 1, 2013 we placed
ACC6 Phase II into service 100% leased."

Fourth Quarter 2012 Results

For the quarter ended December 31, 2012, the company reported earnings of
$0.11 per share compared to $0.12 per share for the fourth quarter of
2011. Revenues increased 16%, or $11.6 million, to $86.0 million for the
fourth quarter of 2012 over the fourth quarter of 2011. The increase in
revenues is primarily due to new leases commencing.

FFO for the quarter ended December 31, 2012 was $0.38 per share compared to
$0.37 per share for the fourth quarter of 2011.  The increase of $0.01 per
share from the prior year's quarter is primarily due to:

  o A positive impact of $0.09 per share from higher operating income
    excluding depreciation and the reserve and charge discussed below ($0.13
    per share from new leases commencing offset by $0.04 per share of
    unreimbursed property operating expenses, real estate taxes and insurance
    related to the properties that are not fully leased).
  o A negative impact of $0.04 per share included in other expenses from a
    receivables reserve set up for one tenant that restructured its lease
    obligations with us. The tenant leases approximately 7.45 MW in four
    different locations and the company has agreed to relinquish a total of
    approximately 16%, or 1.2 MW in aggregate, at two locations, Ashburn and
    Reston, Virginia.  Also, under this restructuring, this tenant's
    outstanding accounts receivable and deferred rent receivable related to
    the returned space has been converted into a note receivable, the terms of
    which require the payment of principal and interest over the next four
    years.  Additionally, under this restructuring this tenant has the right
    to defer up to two-thirds of base rent due over the next 18 months at NJ1
    in Piscataway, New Jersey.  If deferred, the base rent would be added to
    the note. 
  o A negative impact of $0.03 per share from higher financing charges ($0.02
    per share of lower capitalized interest expense and $0.01 per share of
    additional preferred dividends).
  o A negative impact of $0.01 per share included in other expenses for
    pursuit costs for deals that are no longer probable.

Year Ended December 31, 2012 Results

For the year ended December 31, 2012, the company reported earnings of $0.41
per share compared to $0.71 per share for the year ago period.  The decrease
of $0.30 in earnings per share is primarily due to lower capitalized interest,
higher preferred dividends and the reserve and charge noted above.  Revenues
increased 16%, or $45.0 million, to $332.4 million for the year ended December
31, 2012 over the prior year.  The increase in revenues is primarily due to
new leases commencing.

FFO for the year ended December 31, 2012 was $1.48 per share compared to $1.61
per share for the prior year.  The decrease of $0.13 per share is primarily
due to:

  o A positive impact of $0.26 per share from higher operating income
    excluding depreciation and the reserve and charge discussed above ($0.42
    per share from new leases commencing offset by $0.16 per share of
    unreimbursed property operating expenses, real estate taxes and insurance
    related to the properties that are not fully leased).
  o A negative impact of $0.34 per share from higher financing charges ($0.26
    per share of lower capitalized interest expense and $0.08 per share of
    additional preferred dividends).
  o A negative impact of $0.05 per share from the receivables reserve and deal
    pursuit costs noted above.

Portfolio Update

During the fourth quarter 2012, the company:

  o Signed five leases with a weighted average lease term of 6.9 years
    totaling 13.62 MW and 73,582 raised square feet.

       o Two leases were at CH1 totaling 3.03 MW and 21,332 raised square
         feet.  One lease commenced in the fourth quarter of 2012, a portion
         of the other lease commenced in the first quarter of 2013 and the
         remaining portion of this lease totaling 1.30 MW is expected to
         commence in equal parts in the third and fourth quarters of 2013. 
       o One lease was at ACC6 Phase II totaling 4.33 MW and 22,000 raised
         square feet.  This lease is expected to commence in total prior to
         the end of the first quarter of 2013.
       o One lease was at SC1 totaling 5.69 MW and 27,500 raised square feet. 
         A portion of this lease commenced in the first quarter of 2013 and
         the remaining portion totaling 1.14 MW is expected to commence in the
         fourth quarter of 2013.
       o One lease was at NJ1 totaling 0.57 MW and 2,750 raised square feet. 
         This lease commenced in the fourth quarter of 2012.

  o Signed one lease extension for 8.2 years at ACC3 totaling 13.90 MW and
    80,000 raised square feet.

In 2012, the company:

  o Signed 14 leases with a weighted average lease term of 9.9 years totaling
    41.48 MW and 213,295 raised square feet that are expected to generate
    approximately $43.8 million of annualized GAAP base rent revenue.  This
    compares to 14 leases, 24.92 MW and 133,716 raised square feet for the
    prior year.
  o Commenced 15 leases totaling 31.89 MW and 168,355 raised square feet
    totaling approximately $39.6 million of annualized GAAP base rent
    revenue.  This compares to 11 leases, 13.46 MW and 65,093 raised square
    feet for the prior year.
  o Signed four lease extensions with three tenants totaling 23.81 MW and
    148,687 raised square feet for a weighted average additional 7.5 years as
    compared to one lease extension, 9.60 MW and 90,000 raised square feet for
    the prior year.

Subsequent to year-end, the company commenced portions of six leases totaling
13.65 MW and 71,069 raised square feet.

Balance Sheet and Liquidity

The company announced in November a twelve-month common stock repurchase
program of up to $80 million. To date, the company has not elected to utilize
this program.

At year-end, the company had $23.6 million of cash available on its balance
sheet and $207 million of available capacity under its revolving credit
facility.

First Quarter and Full Year 2013 Guidance

The company has established an FFO guidance range of $0.38 to $0.40 per share
for the first quarter of 2013.  The $0.01 per share difference between the
company's fourth quarter 2012 FFO of $0.38 per share and the midpoint of the
first quarter guidance range is primarily due to new leases commencing.

The company has established an FFO guidance range of $1.76 to $1.90 per share
for the full year 2013. The assumptions underlying this guidance can be found
on page 15 of this press release. The $0.35 per share, or 24%, increase
between the company's full year 2012 FFO of $1.48 and the expected mid-point
of the company's guidance range for full year 2013 is primarily due to:

  o A net positive impact of $0.39 per share from higher operating income
    excluding depreciation.  This includes

       o A positive impact of $0.35 per share primarily from new leases
         commencing in 2012 and 2013,
       o A positive impact of $0.04 per share related to lower unreimbursed
         property operating expenses, real estate taxes and insurance, and

  o A negative impact of $0.04 per share from lower capitalized interest
    expense.

Fourth Quarter 2012 Conference Call and Webcast Information

The company will host a conference call to discuss these results today,
Wednesday, February 6, 2013 at 1:00 p.m. ET. To access the live call, please
visit the Investor Relations section of the company's website at www.dft.com
or dial 1-800-860-2442 (domestic) or 1-412-858-4600 (international).  A replay
will be available for seven days by dialing 1-877-344-7529 (domestic) or
1-412-317-0088 (international) using passcode 10023754.  The webcast will be
archived on the company's website for one year at www.dft.com on the
Presentations & Webcasts page.

About DuPont Fabros Technology, Inc.

DuPont Fabros Technology, Inc. (NYSE: DFT) is a leading owner, developer,
operator and manager of enterprise-class, carrier neutral, multi-tenant
wholesale data centers.  The Company's facilities are designed to offer highly
specialized, efficient and safe computing environments in a low-cost operating
model.  The Company's customers outsource their mission critical applications
and include national and international enterprises across numerous industries,
such as technology, Internet content providers, media, communications,
cloud-based, healthcare and financial services.  The Company's ten data
centers are located in four major U.S. markets, which total 2.5 million gross
square feet and 218 megawatts of available critical load to power the servers
and computing equipment of its customers.  DuPont Fabros Technology, Inc., a
real estate investment trust (REIT) 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
full year and first quarter 2013 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, risks related to the
collection of accounts and notes receivable, 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 2013 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 and its quarterly reports on Form 10-Q for the quarters
ended March 31, 2012 and June 30, 2012 and September 30, 2012, 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.

 

DUPONT FABROS TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands except share and per share data)
                        Three months ended December   Year ended December 31,
                        31,
                        2012           2011           2012         2011
                        (unaudited)    (unaudited)
Revenues:
Base rent               $              $              $            $          
                         57,461         49,783         223,045      193,908
Recoveries from tenants 27,241         24,194         104,814      91,246
Other revenues          1,257          425            4,586        2,287
Total revenues          85,959         74,402         332,445      287,441
Expenses:
Property operating      24,286         21,979         94,646       80,351
costs
Real estate taxes and   3,474          1,928          12,689       6,392
insurance
Depreciation and        22,356         20,470         89,241       75,070
amortization
General and             3,310          3,439          17,024       15,955
administrative
Other expenses          4,773          179            6,919        1,137
Total expenses          58,199         47,995         220,519      178,905
Operating income        27,760         26,407         111,926      108,536
Interest income         56             12             168          486
Interest:
Expense incurred        (11,294 )      (9,990 )       (47,765 )    (27,096 )
Amortization of
deferred financing      (819 )         (810 )         (3,496 )     (2,446 )
costs
Net income              15,703         15,619         60,833       79,480
Net income attributable
to redeemable
noncontrolling          (2,046 )       (2,302 )       (7,803 )     (14,505 )
      interests –
operating partnership
Net income attributable
to controlling          13,657         13,317         53,030       64,975
interests
Preferred stock         (6,812 )       (5,573 )       (27,053 )    (20,874 )
dividends
Net income attributable $              $              $            $          
to common shares           6,845          7,744          25,977       44,101
Earnings per share –
basic:
Net income attributable $              $              $            $          
to common shares             0.11           0.12             0.41         0.71
Weighted average common 63,000,839     62,217,754     62,866,189   61,241,520
shares outstanding
Earnings per share –
diluted:
Net income attributable $              $              $            $          
to common shares             0.11           0.12             0.41         0.71
Weighted average common 63,833,651     63,242,288     63,754,006   62,303,905
shares outstanding
Dividends declared per  $              $              $            $          
common share                 0.20           0.12             0.62         0.48

 

 

 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         Year ended December 31,
                           December 31,
                           2012          2011         2012         2011
 Net income                $             $            $            $          
                              15,703        15,619       60,833       79,480
 Depreciation and          22,356        20,470       89,241       75,070
 amortization
 Less:  Non real estate
 depreciation and          (238 )        (262 )       (1,023 )     (862 )
 amortization     
 FFO                       37,821        35,827       149,051      153,688
 Preferred stock dividends (6,812 )      (5,573 )     (27,053 )    (20,874 )
 FFO attributable to       $             $            $            $          
 common shares and OP         31,009        30,254     121,998      132,814
 units
 Straight-line revenues,   (1,143 )      (4,577 )     (17,967 )    (34,095 )
 net of reserve
 Amortization of lease
 contracts above and       (599 )        (974 )       (3,194 )     (2,874 )
 below  
      market value
 Compensation paid with    1,647         1,517        6,980        5,950
 Company common shares
 Non real estate
 depreciation and          238           262          1,023        862
 amortization
 Amortization of deferred  819           810          3,496        2,446
 financing costs
 Improvements to real      (1,093 )      (674 )       (4,426 )     (3,821 )
 estate
 Capitalized leasing       (362 )        (82 )        (1,143 )     (1,713 )
 commissions
 AFFO                      $             $            $            $          
                              30,516        26,536     106,767        99,569
 FFO attributable to
 common shares and OP      $             $            $            $          
 units                            0.38          0.37         1.48         1.61
       per share - diluted
 AFFO per share - diluted  $             $            $            $          
                                  0.37          0.32         1.29         1.21
 Weighted average common
 shares and OP units       82,662,537    82,497,118   82,638,775   82,449,427
       outstanding -
 diluted

    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
(1) 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, compensation paid with Company
    common shares, gain or loss on derivative instruments, acquisition of
    service agreements, below market lease amortization net of above market
    lease amortization early extinguishment of debt costs, non real estate
    depreciation and amortization, amortization of deferred financing costs,
    improvements to real estate and capitalized leasing commissions.  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.

 

 

DUPONT FABROS TECHNOLOGY, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands except share data)
                                            December 31,      December 31,
                                            2012              2011
ASSETS
Income producing property:
Land                                        $                 $          
                                            73,197            63,393
Buildings and improvements                  2,315,499         2,123,377
                                            2,388,696         2,186,770
Less: accumulated depreciation              (325,740 )        (242,245 )
Net income producing property               2,062,956         1,944,525
Construction in progress and land held for  218,934           320,611
development
Net real estate                             2,281,890         2,265,136
Cash and cash equivalents                   23,578            14,402
Restricted cash                             —                 174
Rents and other receivables, net            3,840             1,388
Deferred rent, net                          144,829           126,862
Lease contracts above market value, net     10,255            11,352
Deferred costs, net                         35,670            40,349
Prepaid expenses and other assets           30,797            31,708
Total assets                                $      2,530,859  $      2,491,371
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Line of credit                              $                 $          
                                            18,000            20,000
Mortgage notes payable                      139,600           144,800
Unsecured notes payable                     550,000           550,000
Accounts payable and accrued liabilities    22,280            22,955
Construction costs payable                  6,334             20,300
Accrued interest payable                    2,601             2,528
Dividend and distribution payable           22,177            14,543
Lease contracts below market value, net     14,022            18,313
Prepaid rents and other liabilities         35,524            29,058
Total liabilities                           810,538           822,497
Redeemable noncontrolling                   453,889           461,739
interests—operating partnership
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       185,000           185,000
                          outstanding at
December 31, 2012 and 2011
Series B cumulative redeemable perpetual
preferred stock, 6,650,000 issued and
                          outstanding at
December 31, 2012 and 4,050,000 shares      166,250           101,250
issued and outstanding 
                         at December 31,
2011
Common stock, $.001 par value, 250,000,000
shares authorized, 63,340,929 shares 
               issued and outstanding at
December 31, 2012 and 62,914,987 shares     63                63
issued and
               outstanding at December 31,
2011
Additional paid in capital                  915,119           927,902
Retained earnings (accumulated deficit)     —                 (7,080 )
Total stockholders' equity                  1,266,432         1,207,135
Total liabilities and stockholders' equity  $      2,530,859  $      2,491,371

 

 

DUPONT FABROS TECHNOLOGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
                                          Year ended December 31,
                                          2012               2011
Cash flow from operating activities
Net income                                $        60,833    $        79,480
Adjustments to reconcile net income to
net cash provided by operating activities
Depreciation and amortization             89,241             75,070
Straight line rent, net of reserve        (17,967)           (34,095)
Amortization of deferred financing costs  3,496              2,446
Amortization of lease contracts above and (3,194)            (2,874)
below market value
Compensation paid with Company common     6,980              5,950
shares
Changes in operating assets and
liabilities
Restricted cash                           174                322
Rents and other receivables               (2,452)            1,839
Deferred costs                            (1,278)            (1,773)
Prepaid expenses and other assets         (6,028)            (3,854)
Accounts payable and accrued liabilities  (1,112)            (1,238)
Accrued interest payable                  73                 (238)
Prepaid rents and other liabilities       3,997              4,081
Net cash provided by operating activities 132,763            125,116
Cash flow from investing activities
Investments in real estate – development  (94,753)           (351,090)
Land acquisition costs                    (3,830)            (9,507)
Interest capitalized for real estate      (4,434)            (27,024)
under development
Improvements to real estate               (4,426)            (3,821)
Additions to non-real estate property     (57)               (304)
Net cash used in investing activities     (107,500)          (391,746)
Cash flow from financing activities
Issuance of preferred stock, net of       62,685             97,450
offering costs
Line of credit:
Proceeds                                  48,000             20,000
Repayments                                (50,000)           —
Mortgage notes payable:
Repayments                                (5,200)            (5,200)
Return of escrowed proceeds               —                  1,104
Exercises of stock options                868                700
Payments of financing costs               (2,109)            (1,338)
Dividends and distributions:
Common shares                             (34,112)           (29,338)
Preferred shares                          (26,006)           (19,325)
Redeemable noncontrolling interests –     (10,213)           (9,971)
operating partnership
Net cash (used in) provided by financing  (16,087)           54,082
activities
Net increase (decrease) in cash and cash  9,176              (212,548)
equivalents
Cash and cash equivalents, beginning      14,402             226,950
Cash and cash equivalents, ending         $        23,578    $        14,402
Supplemental information:
Cash paid for interest                    $        52,127    $        54,358
Deferred financing costs capitalized for  $             277  $          1,387
real estate under development
Construction costs payable capitalized    $          6,334   $        20,300
for real estate under development
Redemption of operating partnership units $          6,800   $        66,500
Adjustments to redeemable noncontrolling  $          2,830   $        56,535
interests – operating partnership

 

 

DUPONT FABROS TECHNOLOGY, INC.
Operating Properties
As of December 31, 2012
                                                 Gross      Raised     Critical  %       %
 Property   Property Location       Year Built/  Building   Square     Load      Leased
                                    Renovated    Area       Feet       MW        (4)     Commenced
                                                 (2)        (2)        (3)               (5)
Stabilized
(1)
ACC2        Ashburn, VA                          87,000     53,000     10.4      100%    100%
                                    2001/2005
ACC3        Ashburn, VA                          147,000    80,000     13.9      100%    100%
                                    2001/2006
ACC4        Ashburn, VA             2007         347,000    172,000    36.4      100%    100%
ACC5 (6)    Ashburn, VA                          360,000    176,000    36.4      100%    100%
                                    2009-2010
ACC6 Phase  Ashburn, VA             2011         131,000    65,000     13.0      100%    100%
I
CH1 Phase   Elk Grove Village, IL   2008         285,000    122,000    18.2      100%    100%
I
NJ1 Phase   Piscataway, NJ          2010         180,000    88,000     18.2      39%     39%
I 
VA3 (6)     Reston, VA              2003         256,000    147,000    13.0      56%     56%
VA4         Bristow, VA             2005         230,000    90,000     9.6       100%    100%
Subtotal— stabilized                             2,023,000  993,000    169.1     90%     90%
Completed not Stabilized 
CH1 Phase    Elk Grove Village, IL  2012         200,000    109,000    18.2      100%    71%
II (6)
SC1 Phase I  Santa Clara, CA        2011         180,000    88,000     18.2      75%     44%
(7)
Subtotal— non-stabilized                         380,000    197,000    36.4      88%     58%
Total Operating Properties                       2,403,000  1,190,000  205.5     90%     84%

                      

(1) Stabilized operating properties are either 85% or more leased and
    commenced or have been in service for 24 months or greater.
    Gross building area is the entire building area, including raised square
    footage (the portion of gross building area where the tenants' computer
(2) 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.
    Critical load (also referred to as IT load or load used by tenants'
(3) 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).
    Percentage leased is expressed as a percentage of critical load that is
    subject to an executed lease totaling 184.1 MW. Leases executed as of
(4) December 31, 2012 represent $238 million of base rent on a GAAP basis over
    the next twelve months. Additionally, on a cash basis, leases executed as
    of December 31, 2012 represent $235 million of base rent over the next
    twelve months.
(5) Percentage commenced is expressed as a percentage of critical load where
    the lease has commenced under generally accepted accounting principles.
    In January 2013, leases at ACC5 and VA3 were restructured with a tenant
    and 0.55 MW was returned at ACC5 and 0.65 MW was returned at VA3.  As of
(6) February 5, 2013, ACC5 is 98% leased and commenced and VA3 is 51% leased
    and commenced.  Additionally, an unrelated tenant at CH1 Phase II
    exercised their option to return 1.30 MW before the lease had commenced. 
    As of February 5, 2013, CH1 Phase II is 93% leased and 86% commenced.
(7) As of February 5, 2013, SC1 Phase I is 69% commenced.

 

 

DUPONT FABROS TECHNOLOGY, INC.
Lease Expirations
As of December 31, 2012
                          Raised                        Total kW                % of
 Year of    Number        Square Feet      % of Leased  of Expiring  % of       Annualized
Lease       of Leases     Expiring         Raised       Commenced    Leased kW  Base Rent
Expiration  Expiring (1)  (in thousands)   Square Feet  Leases (2)              (3)
                          (2)
2013 (4)    2             8                0.8%         1,567        0.9%       1.0%
2014        6             35               3.6%         6,287        3.6%       3.9%
2015        4             70               7.1%         13,812       8.0%       7.3%
2016        4             32               3.3%         4,686        2.7%       2.7%
2017        10            69               7.0%         12,039       6.9%       6.6%
2018        11            121              12.3%        24,944       14.4%      14.5%
2019        11            168              17.1%        31,035       17.9%      16.3%
2020        9             96               9.8%         15,196       8.8%       8.8%
2021        7             130              13.2%        21,669       12.5%      13.4%
2022        6             75               7.6%         12,812       7.4%       7.9%
After 2022  12            180              18.2%        29,185       16.9%      17.6%
Total       82            984              100%         173,232      100%       100%

(1) Represents 33 tenants with 82 lease expiration dates. Top three tenants
    represent 48% of annualized base rent.
(2) Raised square footage is that portion of gross building area where the
    tenants locate their computer servers. One MW is equal to 1,000 kW.
    Annualized base rent represents the monthly contractual base rent (defined
(3) as cash base rent before abatements) multiplied by 12 for commenced leases
    totaling 173.2 MW as of December 31, 2012.
    One lease has a rolling option to terminate on six months' notice and has
    a scheduled maturity on September 30, 2013 with no notice received as of
(4) today.  The second lease will expire on December 31, 2013, representing
    2,800 raised square feet, 430 kW of critical load and 0.2% of annualized
    base rent as notice was provided. 

 

 

DUPONT FABROS TECHNOLOGY, INC.
Development Projects
As of December 31, 2012
($ in thousands)
                                   Gross      Raised    Critical  Estimated  Construction     %
Property        Property Location  Building   Square    Load      Total      in Progress &
                                   Area (1)   Feet (2)  MW (3)    Cost (4)   Land Held for    Pre-leased
                                                                             Development (5)
                                                                                               
                                                                              
Current Development Projects
ACC6 Phase II   Ashburn, VA        131,000    65,000    13.0      $110,000   $                100%
(6)                                                                          97,819
Future Development
Projects/Phases
SC1 Phase II    Santa Clara, CA    180,000    88,000    18.2                 61,669
NJ1 Phase II    Piscataway, NJ     180,000    88,000    18.2                 39,212
                                   360,000    176,000   36.4                 100,881
Land Held for Development
ACC7 Phase I    Ashburn, VA        360,000    176,000   36.4                 10,743
/II
ACC8            Ashburn, VA        100,000    50,000    10.4                 3,658
SC2 Phase I/II  Santa Clara, CA    300,000    171,000   36.4                 5,833
                                   760,000    397,000   83.2                 20,234
Total                              1,251,000  638,000   132.6                $        
                                                                             218,934

 

    Gross building area is the entire building area, including raised square
    footage (the portion of gross building area where the tenants' computer
(1) 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.
    Critical load (also referred to as IT load or load used by tenants'
(3) 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).
    Current development projects include land, capitalization for construction
(4) and development, capitalized interest and capitalized operating carrying
    costs, as applicable, upon completion.
    Amount capitalized as of December 31, 2012.  Future Phase II development
(5) projects include only land, shell, underground work and capitalized
    interest through Phase I opening.
    ACC6 Phase II was placed into service on January 1, 2013 and 50% of the
(6) leases commenced immediately. One-third of the remaining leases is
    expected to commence later in the first quarter of 2013 with the remaining
    leases expected to commence in the third quarter of 2013.

 

 

DUPONT FABROS TECHNOLOGY, INC.
Debt Summary as of December 31, 2012
($ in thousands)
                          Amounts             % of Total  Rates  Maturities
                                                                 (years)
                                                           
Secured                   $          139,600  20 %        3.2 %  1.9
Unsecured                 568,000             80 %        8.3 %  4.2
Total                     $          707,600  100 %       7.3 %  3.8
Fixed Rate Debt:
Unsecured Notes           $          550,000  78 %        8.5 %  4.3
Fixed Rate Debt           550,000             78 %        8.5 %  4.3
Floating Rate Debt:
Unsecured Credit Facility 18,000              2 %         2.1 %  3.2
ACC5 Term Loan            139,600             20 %        3.2 %  1.9
Floating Rate Debt        157,600             22 %        3.1 %  2.1
Total                     $          707,600  100 %       7.3 %  3.8

       The Company capitalized interest and deferred financing cost
Note:  amortization of $1.9 million and $4.7 million during the three and
       twelve months ended December 31, 2012, respectively.

 

Debt Maturity as of December 31, 2012
($ in thousands)
Year   Fixed Rate       Floating Rate  Total             % of Total  Rates
2013   $             —  $     5,200    $          5,200  0.7 %       3.2 %
2014   —                134,400(2)     134,400           19.0 %      3.2 %
2015   125,000 (1)      —              125,000           17.7 %      8.5 %
2016   125,000 (1)      18,000(3)      143,000           20.2 %      7.7 %
2017   300,000 (1)      —              300,000           42.4 %      8.5 %
Total  $      550,000   $ 157,600      $      707,600    100 %       7.3 %

(1) The Unsecured Notes have mandatory amortization payments due December 15
    of each respective year.
(2) Remaining principal payment on the ACC5 Term Loan due on December 2, 2014
    with no extension option.
(3) The Unsecured Credit Facility matures on May 6, 2016 with a one-year
    extension option.

 

 

DUPONT FABROS TECHNOLOGY, INC.
Selected Unsecured Debt Metrics
                                                        12/31/12      12/31/11
Interest Coverage Ratio (not less than 2.0)         4.0           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%)    4.9%          5.3%
Total Unsecured Assets to Unsecured Debt (not less  334.3%        329.5%
than 150%)

 

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 December 31, 2012
(in thousands except per share data)
Line of Credit                                            $          
                                                          18,000
Mortgage Notes Payable                                    139,600
Unsecured Notes                                           550,000
Total Debt                                                707,600      23.3 %
Common Shares                     77 %  63,341
Operating Partnership ("OP")      23 %  18,787
Units
Total Shares and Units            100 % 82,128
Common Share Price at December 31,      $      
2012                                    24.16
Common Share and OP Unit Capitalization         $      
                                                1,984,212
 
Preferred Stock ($25 per share liquidation      351,250
preference)
Total Equity                                              2,335,462    76.7 %
Total Market Capitalization                               $            100.0 %
                                                          3,043,062

 

 

DUPONT FABROS TECHNOLOGY, INC.
Common Share and OP Unit
Weighted Average Amounts Outstanding
                                                        YTD         YTD

                                Q4 2012     Q4 2011     Q4 2012     Q4 2011
Weighted Average Amounts

Outstanding for EPS Purposes:
Common Shares – basic           63,000,839  62,217,754  62,866,189  61,241,520
Shares issued from assumed
conversion of:
- Restricted Shares             115,880     264,933     126,534     267,593
- Stock Options                 716,932     759,601     761,283     794,792
- Performance Units             —           —           —           —
Total Common Shares - diluted   63,833,651  63,242,288  63,754,006  62,303,905
Weighted Average Amounts
Outstanding 
     for FFO and AFFO Purposes:
Common Shares – basic           63,000,839  62,217,754  62,866,189  61,241,520
OP Units – basic                18,828,886  19,254,830  18,884,769  20,145,522
Total Common Shares and OP      81,829,725  81,472,584  81,750,958  81,387,042
Units
Shares and OP Units issued from
    assumed conversion of:
- Restricted Shares             115,880     264,933     126,534     267,593
- Stock Options                 716,932     759,601     761,283     794,792
- Performance Units             —           —           —           —
Total Common Shares and Units - 82,662,537  82,497,118  82,638,775  82,449,427
diluted
Period Ending Amounts
Outstanding:

 
Common Shares                   63,340,929
OP Units                        18,786,806
Total Common Shares and Units   82,127,735

 

 

DUPONT FABROS TECHNOLOGY, INC.
2013 Guidance
The earnings guidance/projections provided below are based on current
expectations and are forward-looking.
                                         Expected Q1 2013     Expected 2013

                                         per share            per share
Net income per common share and unit –      $0.10 to $0.12      $0.62 to $0.76
diluted
Depreciation and amortization, net       0.28                 1.14
FFO per share – diluted (1)                 $0.38 to $0.40      $1.76 to $1.90

 

2013 Debt Assumptions
Weighted average debt outstanding                       $690.0 million
Weighted average interest rate                  7.50%
Total interest costs                                     $51.8 million
Amortization of deferred financing costs                    3.7 million
      Interest expense capitalized (2)                      (1.8) million
      Deferred financing costs amortization                 (0.1) million
capitalized (2)
Total interest expense after capitalization              $53.6 million
2013 Other Guidance Assumptions
Total revenues                                           $365 to $385 million
Base rent (included in total revenues)                    $240 to $255 million
Straight-line revenues (included in base rent)           $7 to $15 million
General and administrative expense                       $18 million
Investments in real estate – development (2)             $65 million
Improvements to real estate excluding                    $6 million
development
Preferred stock dividends                               $27 million
Annualized common stock dividend                           $0.80 per share
Weighted average common shares and OP units -              83 million
diluted
Common share repurchase                                  No amounts budgeted
Acquisition of income producing properties               No amounts budgeted

(1) For information regarding FFO, see "Reconciliations of Net Income to FFO
    and AFFO" on page 6 of this earnings release.
(2) Represents one development start mid-year. 

 

SOURCE DuPont Fabros Technology, Inc.

Website: htp://www.dft.com
Contact: Investor Relations Contacts: Mr. Mark L. Wetzel, EVP, CFO &
Treasurer, +1-202-728-0033, mwetzel@dft.com; or Mr. Christopher A. Warnke,
Manager, Investor Relations, +1-202-478-2330, investorrelations@dft.com
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