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CyrusOne ups FY21 revenue guidance to $1.2bn as new CEO takes office

Executive appointment comes as Board of Directors “separates with Bruce Duncan” as president and chief executive officer, and his resignation as a director of the company.

By João Marques Lima

Founder and Editor, The Tech Capital

4 Mins

July 30, 2021 | 12:00 AM BST

CyrusOne (NASDAQ: CONE) has updated its guidance for the full year of 2021, increasing the lower and upper ends of its guidance ranges, as second-quarter earnings deliver on 11% revenue growth to  US$284.6 million compared to $256.4 million for the same period in 2020.

For FY 2021, the Dallas-based business is now expecting revenues between $1,155 million and $1,185 million, versus the previous guidance of $1,135-1,175 million.

CyrusOne has also updated its adjusted EBITDA to $575-590 million but reduced capital expenditure guidance from $925-1,025 million to $875-975 million.

As for Q2, the company said the increase in revenue was driven primarily by a 9% increase in occupied CSF and higher metered power reimbursements.

Revenue included $2.1 million of equipment sales and $0.4 in lease termination fees, compared to $6.9 million of equipment sales and $3.0 million in lease termination fees in the second quarter of 2020.

Net income was $7.4 million for the second quarter, compared to net income of $45.0 million in the same period in 2020, a decrease of (84)%. Net income for the second quarter included a $1.4 million gain associated with a change in fair value on the undesignated portion of the company’s net investment hedge compared to a $(13.9) million loss in the second quarter of 2020.

Additionally, in the second quarter of 2020, the company had a $50.4 million gain on the company’s equity investment in GDS Holdings Limited. Net income per diluted common share was $0.06 in the second quarter of 2021, compared to net income per diluted common share of $0.39 in the same period in 2020.

CyrusOne said it leased approximately 21 MW of power and 345,000 CSF in the second quarter, representing approximately $3.5 million in monthly recurring rent, inclusive of the monthly impact of installation charges.

In the second quarter, the operator completed construction on 146,000 CSF and 45 MW of power capacity across Dublin, London, Northern Virginia, and San Antonio. Percentage CSF leased as of the end of the second quarter was 86% for stabilised properties and 83% overall.

In addition, the company has development projects underway in Frankfurt, London, Paris, Phoenix, Northern Virginia, the New York Metro area, and Cincinnati that are expected to add approximately 280,000 CSF and 64 MW of power capacity plus 303,000 square feet of powered shell.

CyrusOne gross asset value (GAV) reached $9.2 billion as of the end of Q2, an increase of approximately 15% over GAV as of June 30, 2020.

Elsewhere, as the results were released, so was the news that the operator is appointing the company’s co-founder and former CEO and current director David Ferdman to the role of interim president and chief executive officer effective immediately.

CyrusOne said in a statement: “This appointment follows the Board of Directors separating with Bruce Duncan as president and chief executive officer, and his resignation as a director of the company, effective on the transition date. Ferdman will serve until a successor is identified and will remain a member of the Board of Directors.”

Lynn Wentworth, chair of the CyrusOne board, said: “As our Interim President & Chief Executive Officer, Dave brings to the team decades of industry experience, dynamic leadership, and a deep understanding of our business.

“We are confident Dave will lead our company forward towards achieving its plan and objectives during this transition period. On behalf of the entire Board, I would like to thank Bruce Duncan for his leadership over the past year, and we wish him well in his future endeavours.”

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João Marques Lima

Founder and Editor, The Tech Capital

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