Digital Realty Trust(US:DLR)2023-08-03 16:00Financial Performance - Total operating revenues for the six months ended June 30, 2023, increased by approximately $438.3 million, or 19.3%, compared to the same period in 2022, reaching $2,704.99 million[166]. - Stabilized rental and other services revenue increased by $231.9 million, or 12.5%, for the six months ended June 30, 2023, compared to the same period in 2022[167]. - Non-stabilized rental and other services revenue increased by $195.4 million, or 48.7%, for the six months ended June 30, 2023, primarily driven by the completion of the global development pipeline and the Teraco acquisition[167]. - GAAP net income available to common stockholders for the six months ended June 30, 2023, was $166,548 thousand, compared to $116,346 thousand in 2022, reflecting an increase of $50,202 thousand[234]. - Funds from operations (FFO) available to common stockholders and unitholders for the six months ended June 30, 2023, was $950,586 thousand, compared to $917,362 thousand in 2022, indicating a year-over-year increase of $33,224 thousand[234]. - Basic FFO per share for the six months ended June 30, 2023, was $3.17, slightly up from $3.16 in 2022[234]. Occupancy Rates - As of June 30, 2023, the consolidated portfolio occupancy rate was 81.7%, down from 83.5% as of December 31, 2022[149]. - The North America data center portfolio had an occupancy rate of 84.6% as of June 30, 2023, compared to 86.3% at the end of 2022[149]. - The Europe data center portfolio occupancy rate decreased to 77.1% from 79.3% over the same period[149]. - The Asia Pacific region maintained an occupancy rate of 77.1%, up from 75.9%[149]. Debt and Financing - The company has a target debt-to-Adjusted EBITDA ratio of 5.5x and aims for a fixed charge coverage of greater than three times[145]. - The company's total outstanding debt as of June 30, 2023, was $17,856.3 million, with fixed-rate debt comprising 83.2% of the total[218]. - The effective interest rate for total debt as of June 30, 2023, was 2.86%[218]. - The company had approximately $2.2 billion of borrowings available under its Global Revolving Credit Facilities, which provide for borrowings up to $3.9 billion[209][210]. - The company anticipates that the dollar value of acquisitions for the year ending December 31, 2023, will depend on factors such as customer demand and availability of capital[207]. - The company’s consolidated debt included $2,787.8 million in variable rate debt subject to interest rate swaps, which helps mitigate interest rate exposure[239]. Capital Expenditures - The company expects to incur approximately $1.1 billion to $1.3 billion in capital expenditures for development programs during the six months ending December 31, 2023[197]. - Total capital expenditures for the six months ended June 30, 2023, were $1,266,554,000, compared to $996,215,000 for the same period in 2022, representing a year-over-year increase of approximately 27%[201]. Operating Expenses - Total property level operating expenses for the six months ended June 30, 2023, increased by $308.4 million, or 32.2%, compared to the same period in 2022, totaling $1,266.8 million[170]. - Total utilities expenses for the six months ended June 30, 2023, increased by approximately $172.7 million, or 55.2%, compared to the same period in 2022, primarily due to increased utility consumption and higher rates[171]. - Total other operating expenses increased by 12.9% to $560.6 million for the three months ended June 30, 2023, and by 11.0% to $1.11 billion for the six months ended June 30, 2023, compared to the same periods in 2022[178]. Joint Ventures and Asset Sales - A 100% interest in a non-core data center property in Dallas, Texas was sold for gross proceeds of approximately $151 million, resulting in a net gain of approximately $90 million[147]. - The company formed a joint venture with GI Partners, receiving approximately $743 million in gross proceeds from the contribution of data centers[213]. - A joint venture with TPG Real Estate was formed, resulting in approximately $1.3 billion in gross proceeds from the contribution of data centers[215]. Cash Flow - Net cash provided by operating activities increased to $814,114 thousand in the first half of 2023, up from $783,578 thousand in 2022, representing a change of $30,536 thousand[223]. - Net cash used in investing activities decreased by $148,826 thousand, primarily due to a $301,633 thousand increase in cash used for improvements to investments in real estate and a $150,771 thousand increase in cash provided by proceeds from the sale of real estate[225]. - Net cash provided by financing activities decreased by $148,759 thousand, largely due to a $1,010,673 thousand decrease in cash provided by short-term borrowings and a $319,266 thousand decrease in cash provided by proceeds from secured/unsecured debt[226]. Internal Controls and Risk Management - The company has no changes in internal control over financial reporting that materially affected its operations during the most recent fiscal quarter[244]. - The effectiveness of the company's disclosure controls and procedures was confirmed by the CEO and CFO at a reasonable assurance level[243]. - The company utilizes cross-currency interest rate swaps to hedge currency exposure associated with its net investment in foreign subsidiaries[241]. - The company does not use derivatives for trading or speculative purposes, focusing instead on risk management[238].