Summary
Digital Realty Trust, Inc. (DLR) reported solid performance in its Q2 2013 10-Q filing, demonstrating continued growth in its data center portfolio. The company expanded its property count and rentable square footage, with a strong focus on developing and leasing high-quality, strategically located data center space. Revenues saw a significant increase driven by both existing and newly acquired properties, alongside robust tenant reimbursements. While DLR continues to execute its growth strategy through acquisitions and development, it also maintains a prudent approach to leverage, with a debt-to-enterprise value ratio of approximately 35%. The company's strategy emphasizes maximizing long-term growth in earnings and funds from operations per share, underpinned by the consistent demand for data center space. Investors should note the company's geographic concentration in key metropolitan markets and its ongoing efforts to manage operating expenses and interest rates, particularly in light of prevailing economic conditions.
Financial Highlights
30 data points| Revenue | $363.50M |
| Operating Expenses | $263.51M |
| Operating Income | $99.99M |
| Interest Expense | $47.58M |
| Net Income | $58.48M |
| EPS (Basic) | $0.37 |
| EPS (Diluted) | $0.37 |
| Shares Outstanding (Basic) | 128.42M |
| Shares Outstanding (Diluted) | 128.62M |
Key Highlights
- 1Digital Realty Trust reported a significant increase in total operating revenues for both the three-month and six-month periods ended June 30, 2013, compared to the same periods in 2012, driven by new leasing, acquisitions, and strong tenant reimbursements.
- 2The company's portfolio expanded to 127 properties with 23.7 million rentable square feet by June 30, 2013, up from 108 properties and 20.5 million rentable square feet in the prior year, reflecting active acquisition and development.
- 3Occupancy remained strong at 93.1% for properties excluding space held for development, indicating consistent demand for DLR's data center offerings.
- 4Lease rates on renewed space showed positive trends, with an average increase of 8.7% on a GAAP basis over the twelve months ended June 30, 2013, suggesting favorable market conditions for DLR's assets.
- 5DLR maintained a conservative leverage profile, with a debt-to-total enterprise value ratio of approximately 35% as of June 30, 2013, below its target of 60%.
- 6The company continued significant investment in development projects, with $797.7 million in construction work in progress as of June 30, 2013, indicating a focus on future growth and capacity expansion.
- 7International operations, particularly in England, represented a substantial portion of revenues and long-lived assets, highlighting DLR's global presence.