4Q22 & FY22 Earnings Call 15 March 2023 NASDAQ: GDS HKEX: 9698 © GDS 2016 0 DISCLAIMER This presentation contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “may,” “will,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “potential,” “continue,” “is/are likely to” or ...

Financial Data and Key Metrics Changes - The company reported its fourth quarter and full year 2022 earnings during the conference call [1] Business Line Data and Key Metrics Changes - No specific details regarding changes in business line data and key metrics were provided in the document [1] Market Data and Key Metrics Changes - No specific details regarding changes in market data and key metrics were provided in the document [1] Company Strategy and Development Direction and Industry Competition - No specific details regarding company strategy, development direction, or industry competition were provided in the document [1] Management Comments on Operating Environment and Future Outlook - No specific comments from management regarding the operating environment and future outlook were provided in the document [1] Other Important Information - The conference call was hosted by Laura Chen, Head of Investor Relations, and was recorded for participants [1] Q&A Session All Questions and Answers - No questions and answers were provided in the document [1]

Financial Performance - In Q4 2022, net revenue increased by 9.9% to RMB 2,404.0 million (USD 348.6 million) compared to RMB 2,187.4 million in Q4 2021[4] - For the full year 2022, net revenue rose by 19.3% to RMB 9,325.6 million (USD 1,352.1 million) from RMB 7,818.7 million in 2021[5] - Adjusted EBITDA for Q4 2022 grew by 4.3% to RMB 1,071.5 million (USD 155.3 million), with an adjusted EBITDA margin of 44.6%[4] - The adjusted EBITDA for the full year 2022 increased by 14.8% to RMB 4,251.4 million (USD 616.4 million) compared to RMB 3,703.4 million in 2021[6] - Q4 2022 net loss was RMB 177.9 million ($25.8 million), an improvement from a net loss of RMB 312.9 million in Q4 2021 and RMB 339.7 million in Q3 2022[12] - The company reported a net loss attributable to shareholders of RMB 340,016 thousand for the quarter ended December 31, 2022, compared to RMB 315,888 thousand in the same quarter of 2021[34] - The net loss for the year ended December 31, 2022, was RMB (177,895) thousand, compared to RMB (339,663) thousand for the same period in 2021, representing a decrease of approximately 48%[35] Revenue Breakdown - Service revenue for Q4 2022 was RMB 2,404.0 million ($348.6 million), up 10.0% year-over-year and up 1.5% quarter-over-quarter[9] - The service revenue for 2022 was RMB 9,317.9 million (USD 1,351.0 million), up 19.2% from RMB 7,814.4 million in 2021[15] - Total revenue for the year ended December 31, 2022, was RMB 9,325,631 thousand, up from RMB 7,818,681 thousand in 2021, representing a growth of approximately 19.3%[32] Operational Metrics - The total area signed and pre-signed by customers increased by 12,347 square meters in Q4 2022, reaching 630,716 square meters, a year-on-year increase of 13.3%[7] - The operational area increased by 5,276 square meters in Q4 2022, totaling 515,787 square meters, reflecting a year-on-year growth of 5.7%[7] - The construction area as of December 31, 2022, was 192,713 square meters, with a pre-signing rate of 71.5%[7] - The total area of signed and pre-signed contracts at the end of Q4 2022 was 630,716 square meters, a year-over-year increase of 13.3%[17] - The operational area at the end of Q4 2022 was 515,787 square meters, up 5.7% year-over-year[18] - The construction area at the end of Q4 2022 was 192,713 square meters, representing a year-over-year increase of 19.3%[19] Cost and Expenses - The cost of sales in 2022 was RMB 7,389.8 million (USD 1,071.4 million), representing a 22.4% increase from RMB 6,039.3 million in 2021[15] - Operating expenses for the year ended December 31, 2022, totaled RMB 1,185,080 thousand, compared to RMB 1,021,950 thousand in 2021, indicating an increase of about 16.0%[32] - Interest expense for Q4 2022 was RMB 476.8 million ($69.1 million), a 7.7% increase from Q4 2021 and a 7.3% increase from Q3 2022[12] - The company reported interest expenses of RMB 476,780 thousand for the year ended December 31, 2022[38] Cash and Debt Position - As of December 31, 2022, cash totaled RMB 8,608.1 million (USD 1,248.1 million), while total short-term debt was RMB 6,161.7 million (USD 893.4 million)[20] - The company’s short-term borrowings as of December 31, 2022, were RMB 3,623,967 thousand, a decrease from RMB 5,948,013 thousand in 2021, reflecting a reduction of approximately 39%[31] - The company reported a net cash inflow from financing activities of RMB 4,118,458 thousand for the year ended December 31, 2022[35] - The company experienced a significant increase in operating cash flow, with a net cash provided by operating activities of RMB 1,201,363 thousand for the year ended December 31, 2022[35] Future Outlook - The company expects total revenue for 2023 to be between RMB 9,940 million and RMB 10,320 million, reflecting a year-over-year growth of approximately 6.6% to 10.7%[21] - The company anticipates capital expenditures of approximately RMB 7,500 million for the full year of 2023[21] - The company expects continued growth in the high-performance data center market, driven by increasing demand for cloud computing services in China[30] - Future guidance indicates a cautious outlook due to potential market volatility and regulatory changes impacting operations in China[30] Strategic Initiatives - The company plans to continue expanding internationally while maintaining a strong position in China, as stated by the CEO[7] - The company is focusing on strategic acquisitions and investments to enhance its market position and operational capabilities[30] Financial Metrics and Adjustments - The company utilizes adjusted EBITDA, adjusted EBITDA margin, adjusted gross profit, and adjusted gross margin as key performance indicators to assess operational performance and set business targets[23] - The company emphasizes that adjusted financial metrics are often used by analysts and investors to evaluate financial performance within the industry[24] - The adjusted financial metrics do not replace GAAP measures such as gross profit, net profit (loss), or cash flow from operating activities, and should be considered alongside these measures[25] - Preliminary unaudited financial data may undergo adjustments during the year-end audit, potentially leading to significant differences from the initial figures[27] Asset and Liability Overview - Total assets as of December 31, 2022, amounted to RMB 74,813,954 thousand, an increase from RMB 71,632,443 thousand in 2021, reflecting a growth of approximately 4.5%[31] - Total liabilities as of December 31, 2022, were RMB 50,629,299 thousand, up from RMB 45,736,281 thousand in 2021, representing an increase of approximately 10.4%[31] - The company's total equity as of December 31, 2022, was RMB 23,137,643 thousand, a slight increase from RMB 24,533,009 thousand in 2021, showing a decrease of about 5.7%[31] Research and Development - R&D expenses in Q4 2022 were RMB 10.0 million ($1.4 million), down from RMB 12.4 million in Q4 2021 and RMB 6.7 million in Q3 2022[11] - Research and development expenses for the quarter ended December 31, 2022, were RMB 9,986 thousand, compared to RMB 12,422 thousand in the same quarter of 2021, showing a decrease of approximately 19.6%[32]

Revenue Growth - Net revenue for Q4 2022 increased by 9.9% year-over-year to RMB2,404.0 million (US$348.6 million) compared to RMB2,187.4 million in Q4 2021[3]. - Full year 2022 net revenue rose by 19.3% year-over-year to RMB9,325.6 million (US$1,352.1 million) from RMB7,818.7 million in 2021[4]. - Service revenue for the three months ended December 2022 reached RMB 2,404,034, up from RMB 2,367,593 in the previous quarter, indicating a quarter-over-quarter increase of about 1.6%[59]. - Total net revenue for the year ended December 2022 was RMB 9,325,631, an increase from RMB 7,818,681 in the previous year, representing a growth of approximately 19.3%[59]. EBITDA Performance - Adjusted EBITDA for Q4 2022 was RMB1,071.5 million (US$155.3 million), a 4.3% increase from RMB1,027.4 million in Q4 2021[20]. - Full year 2022 adjusted EBITDA increased by 14.8% year-over-year to RMB4,251.4 million (US$616.4 million) from RMB3,703.4 million in 2021[4]. - Adjusted EBITDA was RMB4,251.4 million (US$616.4 million) in 2022, a 14.8% increase from RMB3,703.4 million in 2021, with an Adjusted EBITDA margin of 45.6%[28]. - Adjusted EBITDA margin for Q4 2022 decreased to 44.6% from 47.0% in Q4 2021, primarily due to higher general corporate expenses[21]. - Adjusted EBITDA for Q4 2022 was RMB 1,071,480, with an adjusted EBITDA margin of 44.6%[70]. Customer Metrics - Total area committed and pre-committed by customers increased by 12,347 square meters in Q4 2022, reaching 630,716 square meters as of December 31, 2022, a 13.3% year-over-year increase[5]. - Area utilized by customers increased by 10,685 square meters in Q4 2022, totaling 370,547 square meters as of December 31, 2022, a 16.0% year-over-year increase[5]. - Commitment rate for area in service was 95.5% as of December 31, 2022, up from 93.8% a year earlier[5]. - The company added over 73,000 square meters of net new bookings in 2022, including a significant 25,000 square meters commitment from an anchor customer in Southeast Asia[6]. - Total area committed and pre-committed at the end of Q4 2022 was 630,716 sqm, a 13.3% increase year-over-year[29]. - Area in service at the end of Q4 2022 was 515,787 sqm, a 5.7% increase year-over-year[30]. - Area under construction at the end of Q4 2022 was 192,713 sqm, a 19.3% increase year-over-year[30]. Financial Position - The company successfully raised US$580 million through a private placement of convertible senior notes in January 2023 to enhance its financial position[8]. - Cash as of December 31, 2022, was RMB8,608.1 million (US$1,248.1 million), with total short-term debt of RMB6,161.7 million (US$893.4 million)[35]. - As of December 31, 2022, GDS Holdings reported total assets of RMB 74,813,954, an increase from RMB 71,632,443 in 2021, representing a growth of approximately 3.05%[56]. - Current assets decreased to RMB 11,951,076 in December 2022 from RMB 14,463,875 in 2021, a decline of about 17.4%[56]. - Total liabilities increased to RMB 50,629,299 in December 2022 from RMB 45,736,281 in 2021, reflecting an increase of approximately 10.4%[57]. - The company's cash position decreased to RMB 8,608,131 in December 2022 from RMB 9,968,109 in 2021, a reduction of about 13.6%[56]. - Accounts receivable increased to RMB 2,406,025 in December 2022 from RMB 1,732,686 in 2021, marking a growth of approximately 39%[56]. - Long-term borrowings, excluding current portion, rose to RMB 23,518,058 in December 2022 from RMB 18,284,514 in 2021, an increase of about 28.5%[57]. - GDS Holdings' accumulated deficit increased to RMB 5,179,705 in December 2022 from RMB 3,910,815 in 2021, reflecting a rise of approximately 32.4%[57]. - The total equity of GDS Holdings decreased to RMB 23,137,643 in December 2022 from RMB 24,533,009 in 2021, a decline of about 5.7%[57]. - The company reported a current portion of convertible bonds payable of RMB 2,083,829 in December 2022, which was not present in 2021[57]. - GDS Holdings' total mezzanine equity increased to RMB 1,047,012 in December 2022 from RMB 958,480 in 2021, an increase of approximately 9.3%[57]. Expenses and Losses - General and administrative expenses were RMB487.6 million (US$70.7 million) in 2022, a 15.7% increase from RMB421.4 million in 2021[25]. - Research and development costs decreased to RMB35.8 million (US$5.2 million) in 2022 from RMB39.3 million in 2021[25]. - Operating expenses for the year ended December 2022 totaled RMB 1,185,080, an increase from RMB 1,021,950 in the previous year, representing a rise of about 16.0%[59]. - Net loss increased to RMB1,266.1 million (US$183.6 million) in 2022 from RMB1,191.2 million in 2021[26]. - Net loss attributable to GDS Holdings Limited shareholders for the year ended December 2022 was RMB 1,268,890, compared to RMB 1,187,218 in the previous year, indicating an increase in losses of approximately 6.9%[59]. - The company reported a comprehensive loss of RMB 1,513,627 for the year ended December 2022, compared to RMB 1,350,927 in the previous year, reflecting an increase of approximately 12.1%[62]. - Net loss for Q4 2022 was RMB (177,895), an improvement from RMB (339,663) in Q3 2022 and RMB (312,882) in Q4 2021[70]. Cash Flow - Net cash provided by operating activities for the year ended December 2022 was RMB 2,858,067, significantly higher than RMB 1,201,363 in the previous year, showing an increase of about 138.0%[64]. - Net cash used in investing activities for the year ended December 31, 2022, was RMB (13,691,538), compared to RMB (11,274,884) in 2021[65]. - Cash and restricted cash at the end of Q4 2022 was RMB 12,026,367, up from RMB 9,253,805 at the end of Q3 2022[65]. - The company reported a net increase in cash and restricted cash of RMB 1,803,701 for Q4 2022[65]. Shareholder Information - The weighted average number of ordinary shares outstanding for the year ended December 2022 was 1,464,447,843, slightly up from 1,452,906,722 in the previous year[60].

GDS Holdings Limited (NASDAQ:GDS) Q3 2022 Earnings Conference Call November 22, 2022 7:00 PM ET Company Participants Laura Chen - Head Investor Relations William Huang - Founder, Chairman & Chief Executive Officer Dan Newman - Chief Financial Officer Jamie Khoo - Chief Operating Officer Conference Call Participants Yang Liu - Morgan Stanley Tina Hou - Goldman Sachs Gokul Hariharan - J.P. Morgan Michael Elias - Cowen Frank Louthan - Raymond James Sara Wang - UBS Mingran Li - CICC Operator Hello, ladies and g ...

Financial Performance - For Q3 2022, GDS Holdings reported a net revenue of RMB 2,367.6 million (USD 332.8 million), representing a year-over-year increase of 14.9%[5] - The service revenue for Q3 2022 also increased by 14.9% to RMB 2,367.6 million (USD 332.8 million) compared to Q3 2021[8] - The adjusted EBITDA for Q3 2022 grew by 10.9% to RMB 1,066.6 million (USD 149.9 million), with an adjusted EBITDA margin of 45.0%[5] - The gross profit for Q3 2022 was RMB 492.8 million (USD 69.3 million), an increase of 8.2% compared to Q3 2021[9] - The gross profit margin for Q3 2022 was 20.8%, down from 22.1% in Q3 2021[9] - Net loss for Q3 2022 was RMB 339.7 million (USD 47.7 million), compared to a net loss of RMB 301.1 million in Q3 2021 and RMB 375.3 million in Q2 2022[11] - Total net revenue for the nine months ended September 30, 2022, was RMB 6,921,597 thousand, representing an increase from RMB 5,631,304 thousand for the same period in 2021, a growth of approximately 22.9%[32] - The net loss attributable to shareholders for the three months ended September 30, 2022, was RMB 340,016 thousand, compared to a net loss of RMB 375,357 thousand for the same period in 2021, a reduction of approximately 9.4%[34] - The total comprehensive loss for the three months ended September 30, 2022, was RMB 559,415 thousand, compared to RMB 517,594 thousand for the same period in 2021, indicating an increase of approximately 8.1%[34] Operational Metrics - The total area signed and pre-signed by customers increased by 30,315 square meters to 618,369 square meters, a year-over-year increase of 16.0%[6] - The operational area increased by 6,128 square meters to 510,511 square meters, reflecting a year-over-year growth of 12.4%[6] - The pre-signing rate for the area under construction reached 71.5%, up from 62.1% in the previous year[7] - The billing area increased by 14,184 square meters to 359,862 square meters, a year-over-year increase of 19.8%[7] - Total contracted and pre-contracted area at the end of Q3 2022 was 618,369 square meters, up 16.0% year-over-year and 5.2% quarter-over-quarter[14] - Operating area at the end of Q3 2022 was 510,511 square meters, a 12.4% increase year-over-year and a 1.2% increase quarter-over-quarter[15] - The company achieved a pre-contracted rate of 71.5% for the area under construction at the end of Q3 2022, compared to 62.1% in Q3 2021[15] Expenses and Financing - In Q3 2022, general and administrative expenses were RMB 125.4 million (USD 17.6 million), an increase of 21.9% year-over-year and 26.9% quarter-over-quarter[10] - R&D expenses in Q3 2022 were RMB 6.7 million (USD 0.9 million), down from RMB 9.0 million in Q3 2021 and RMB 9.4 million in Q2 2022[11] - GDS Holdings secured approximately RMB 3.6 billion in new project debt financing during Q3 2022[6] - The company incurred equity incentive expenses of RMB 71,119 thousand for the three months ended September 30, 2022, down from RMB 91,760 thousand in the same period of 2021, a decrease of 22.5%[38] - The company reported interest expenses of RMB 444,328 thousand for the three months ended September 30, 2022, compared to RMB 392,072 thousand for the same period in 2021, an increase of 13.3%[38] Cash and Assets - Cash as of September 30, 2022, was RMB 9,092.4 million (USD 1,278.2 million), with total short-term debt of RMB 5,557.3 million (USD 781.2 million)[19] - As of September 30, 2022, total assets amounted to RMB 71.63 billion, a decrease from RMB 74.88 billion as of December 31, 2021[31] - Cash reserves stood at RMB 9.97 billion, compared to RMB 9.09 billion in the previous year[31] - Total liabilities reached RMB 45.74 billion, down from RMB 50.66 billion as of December 31, 2021[31] - The company reported a total equity of RMB 24.53 billion, an increase from RMB 23.15 billion in the previous year[31] - The net value of property and equipment was RMB 40.62 billion, a decrease from RMB 45.87 billion[31] - The total current liabilities amounted to RMB 13.47 billion, an increase from RMB 11.29 billion[31] - The company’s goodwill and intangible assets net value was RMB 8.36 billion, slightly up from RMB 8.18 billion[31] - The total equity attributable to shareholders was RMB 24.47 billion, compared to RMB 23.05 billion in the previous year[31] Guidance and Future Outlook - The company confirmed its revised guidance for total revenue in 2022 to be between RMB 9,250 million and RMB 9,400 million, with adjusted EBITDA between RMB 4,200 million and RMB 4,280 million[20] - The company is focused on expanding its data center operations to meet broader client requirements beyond its primary locations[28] Performance Metrics and Adjustments - The company utilizes adjusted EBITDA, adjusted EBITDA margin, adjusted gross profit, and adjusted gross profit margin as key performance indicators to assess operational performance and set business goals[22] - The company emphasizes that adjusted non-GAAP financial metrics should not be solely relied upon for assessing operational performance, cash flows, or liquidity[24] - The preliminary unaudited financial data presented may undergo adjustments during the year-end audit, potentially leading to significant differences[27] Company Profile and Services - The company operates high-performance data centers strategically located in major economic centers in China, catering to the concentrated demand for such services[28] - The company has a 21-year track record in service delivery, successfully meeting the needs of some of China's largest and most demanding clients for data center outsourcing[28] - The company provides a range of value-added services, including managed network services and hybrid cloud services through direct private links to leading public clouds[28] - The company is neutral to operators and cloud service providers, allowing clients access to all major telecom networks in China[28]

Financial Performance - Net revenue for Q3 2022 increased by 14.9% year-over-year to RMB2,367.6 million (US$332.8 million) [4] - Adjusted EBITDA for Q3 2022 was RMB1,066.6 million (US$149.9 million), reflecting a 10.9% increase year-over-year [14] - Gross profit for Q3 2022 was RMB492.8 million (US$69.3 million), an 8.2% increase year-over-year [9] - Total net revenue for the three months ended September 2022 was RMB 2,367,593, representing an increase from RMB 2,302,729 in the previous quarter [43] - Gross profit for the same period was RMB 492,805, with a gross margin of approximately 20.8% [43] - Net loss attributable to GDS Holdings Limited shareholders for the three months ended September 2022 was RMB 340,016, compared to a net loss of RMB 375,357 in the previous quarter [43] - Operating expenses for the three months ended September 2022 were RMB 302,122, compared to RMB 287,179 in the previous quarter, indicating a rise of approximately 5.0% [43] - The company reported a net loss before income taxes of RMB 272,280 for the three months ended September 2022, compared to RMB 316,462 in the previous quarter [43] - Basic and diluted loss per ordinary share for the three months ended September 2022 was RMB 0.24, slightly improved from RMB 0.27 in the previous quarter [43] - Net loss for the three months ended September 2022 was RMB (339,663), compared to RMB (375,307) for the three months ended June 30, 2022, representing a decrease of approximately 9% [51] - Adjusted EBITDA for the three months ended September 2022 was RMB 1,066,569, with an adjusted EBITDA margin of 45.0% [52] Customer and Market Metrics - Total area committed and pre-committed by customers reached 618,369 sqm, a 16.0% increase year-over-year [5] - Area utilized by customers increased by 14,184 sqm in Q3 2022, totaling 359,862 sqm, a 19.8% year-over-year increase [19] - Commitment rate for area in service was 95.6% as of September 30, 2022, slightly down from 95.9% a year earlier [19] - The utilization rate for area in service improved to 70.5% compared to 66.1% in Q3 2021 [20] Construction and Development - Area under construction increased to 182,355 sqm, a 16.0% year-over-year increase [18] - The company completed the acquisition of minority equity interest in Beijing 13 and Beijing 14 data centers [23] Financial Position and Debt - As of September 30, 2022, cash was RMB9,092.4 million (US$1,278.2 million) and total short-term debt was RMB5,557.3 million (US$781.2 million) [21] - Total long-term debt amounted to RMB36,136.1 million (US$5,079.9 million), with long-term borrowings (excluding current portion) at RMB22,594.9 million (US$3,176.3 million) [21] - The company obtained approximately RMB 3.6 billion in new project debt facilities during Q3 2022 [7] - The company obtained new project debt facilities of RMB3,584.3 million (US$503.9 million) during Q3 2022 [21] - Total liabilities decreased to RMB 45,736,281 from RMB 50,659,883 year-over-year, a reduction of approximately 9.1% [40] - Total equity increased to RMB 24,533,009, up from RMB 23,148,845, reflecting a growth of about 6.0% [40] Cash Flow and Expenses - Cash flows from operating activities for the nine months ended September 2022 were negative, indicating ongoing challenges in cash generation [46] - Net cash provided by operating activities for the nine months ended September 2022 was RMB 1,950,164, an increase from RMB 795,268 for the same period in 2021 [51] - Total depreciation and amortization for the nine months ended September 2022 was RMB 2,368,631, up from RMB 1,877,722 in the same period of 2021 [51] - Cash and restricted cash at the end of the period for September 2022 was RMB 10,222,666, compared to RMB 9,328,947 at the end of June 2022 [51] - Share-based compensation expense for the three months ended September 2022 was RMB 71,119, down from RMB 88,344 for the three months ended June 30, 2022 [52] - Net interest expenses for the three months ended September 2022 were RMB 444,328, compared to RMB 470,838 for the three months ended June 30, 2022 [52] - Net cash used in investing activities for the nine months ended September 2022 was RMB (9,143,923), compared to RMB (10,961,896) for the same period in 2021 [51] - Payments related to acquisitions and investments for the three months ended September 2022 were RMB (377,184), compared to RMB (328,006) for the three months ended June 30, 2022 [51] Strategic Focus - The company continues to focus on expanding its market presence and enhancing its product offerings through ongoing research and development initiatives [42] - The company emphasizes the use of non-GAAP measures like Adjusted EBITDA to evaluate operating performance, which excludes certain expenses [26] - The company confirmed revised guidance for total revenues in 2022 of RMB9,250 million to RMB9,400 million and Adjusted EBITDA of RMB4,200 million to RMB4,280 million [24] - The company has a 21-year track record of service delivery, primarily serving hyperscale cloud service providers and large internet companies [34]

GDS Holdings Limited (NASDAQ:GDS) Q2 2022 Earnings Conference Call August 23, 2022 8:00 AM ET Company Participants Laura Chen - Head Investor Relations William Huang - Founder, Chairman & Chief Executive Officer Dan Newman - Chief Financial Officer Jamie Khoo - Chief Operating Officer Conference Call Participants Michael Elias - Cowen Tina Hou - Goldman Sachs Bora Lee - RBC Capital Markets Yang Liu - Morgan Stanley Frank Louthan - Raymond James Operator Hello, ladies and gentlemen. Thank you for standing by ...