GDS Reports Third Quarter 2019 Results
Third Quarter 2019 Financial Highlights
- Net revenue increased by 39.8% year-over-year (“Y-o-Y”) to
RMB1,066.2 million (US$149.2 million ) in the third quarter of 2019 (3Q2018:RMB762.8 million ). - Service revenue increased by 40.7% Y-o-Y to
RMB1,058.9 million (US$148.1 million ) in the third quarter of 2019 (3Q2018:RMB752.6 million ). - Net loss was
RMB108.6 million (US$15.2 million ) in the third quarter of 2019, compared with a net loss ofRMB119.4 million in the third quarter of 2018. - Adjusted EBITDA (non-GAAP) increased by 60.6% Y-o-Y to
RMB483.7 million (US$67.7 million ) in the third quarter of 2019 (3Q2018:RMB301.2 million ). See “Non-GAAP Disclosure” and “Reconciliations of GAAP and non-GAAP results” elsewhere in this earnings release. - Adjusted EBITDA margin (non-GAAP) increased to 45.4% in the third quarter of 2019 (3Q2018: 39.5%).
Operating Highlights
- Total area committed increased by 49.8% Y-o-Y to 242,435 square meters (“sqm”) as of
September 30, 2019 (September 30, 2018 : 161,799 sqm). - Area utilized (or revenue generating space) increased by 36.9% Y-o-Y to 137,820 sqm as of
September 30, 2019 (September 30, 2018 : 100,679 sqm). - Area in service increased by 34.4% Y-o-Y to 198,097 sqm as of
September 30, 2019 (September 30, 2018 : 147,342 sqm). - Commitment rate for area in service was 91.7% as of
September 30, 2019 (September 30, 2018 : 96.3%), and utilization rate was 69.6% as ofSeptember 30, 2019 (September 30, 2018 : 68.3%). - Area under construction was 84,765 sqm as of
September 30, 2019 (September 30, 2018 : 43,718 sqm). - Pre-commitment rate for area under construction was 71.6% as of
September 30, 2019 (September 30, 2018 : 45.4%).
“We delivered another strong quarter across all parts of our business,” said Mr.
“Our top line growth was sustained in the third quarter, posting an increase of around 40% year-over-year,” said Mr.
Third quarter 2019 Financial Results
Net revenue in the third quarter of 2019 was
Cost of revenue in the third quarter of 2019 was
Gross profit was
Adjusted Net Operating Income (“Adjusted NOI”) (non-GAAP) is defined as net loss (computed in accordance with GAAP), excluding net interest expenses, income tax expenses (benefits), depreciation and amortization, accretion expenses for asset retirement costs, share-based compensation expenses, selling and marketing expenses, general and administrative expenses, research and development expenses, foreign currency exchange loss (gain) and others. Adjusted NOI was
Adjusted NOI margin (non-GAAP) was 53.6% in the third quarter of 2019, compared with 48.1% in the third quarter of 2018, and 53.0% in the second quarter of 2019. The increase over the previous quarter was mainly due to the leverage effect realized on fixed-cost components of cost of revenue.
Selling and marketing expenses, excluding share-based compensation expenses of
General and administrative expenses, excluding share-based compensation expenses of
Research and development costs were
Net interest expenses for the third quarter of 2019 were
Foreign currency exchange loss for the third quarter of 2019 was
Net loss in the third quarter of 2019 was
Adjusted EBITDA (non-GAAP) is defined as net loss excluding net interest expenses, income tax expenses (benefits), depreciation and amortization, accretion expenses for asset retirement costs and share-based compensation expenses. Adjusted EBITDA was
Adjusted EBITDA margin (non-GAAP) was 45.4% in the third quarter of 2019, compared with 39.5% in the third quarter of 2018, and 43.5% in the second quarter of 2019. The increase over the previous quarter was mainly due to the leverage effect realized on fixed-cost components of cost of revenue, and the positive impact from less foreign currency exchange loss.
Basic and diluted loss per ordinary share in the third quarter of 2019 was
Basic and diluted loss per American Depositary Share (“ADS”) in the third quarter of 2019 was
Sales
Total area committed at the end of the third quarter of 2019 was 242,435 sqm, compared with 161,799 sqm at the end of the third quarter of 2018 and 220,818 sqm at the end of the second quarter of 2019, an increase of 49.8% Y-o-Y and 9.8% quarter-over-quarter (“Q-o-Q”). In the third quarter of 2019, net additional total area committed was 21,617 sqm, including significant contributions from our
Data Center Resources
Area in service at the end of the third quarter of 2019 was 198,097 sqm, compared with 147,342 sqm at the end of the third quarter of 2018 and 180,441 sqm at the end of the second quarter of 2019, an increase of 34.4% Y-o-Y and 9.8% Q-o-Q. In the third quarter of 2019, our SH7 (6,352 sqm), SZ5 Phase 3 (7,725 sqm) and GZ3 Phase 2 (3,423 sqm) data centers came into service.
Area under construction at the end of the third quarter of 2019 was 84,765 sqm, compared with 43,718 sqm at the end of the third quarter of 2018 and 78,373 sqm at the end of the second quarter of 2019, an increase of 93.9% Y-o-Y and 8.2% Q-o-Q. In the third quarter of 2019, construction commenced on our LF3,
Commitment rate of area in service was 91.7% at the end of the third quarter of 2019, compared with 96.3% at the end of the third quarter of 2018 and 93.7% at the end of second quarter of 2019. Pre-commitment rate of area under construction was 71.6% at the end of the third quarter of 2019, compared with 45.4% at the end of the third quarter of 2018 and 66.1% at the end of the second quarter of 2019.
Area utilized at the end of the third quarter of 2019 was 137,820 sqm, compared with 100,679 sqm at the end of the third quarter of 2018 and 127,107 sqm at the end of the second quarter of 2019, an increase of 36.9% Y-o-Y and 8.4% Q-o-Q. Net additional area utilized was 10,713 sqm in the third quarter, which mainly came from the additional area utilized in SZ5, BJ5 and SH9 data centers.
Utilization rate of area in service was 69.6% at the end of the third quarter of 2019, compared with 68.3% at the end of the third quarter of 2018 and 70.4% at the end of the second quarter of 2019.
Liquidity
As of
Recent Developments
The Company recently entered in to an agreement for the purchase of a second site in
The Company has good visibility in to long term data center demand in
Completion of Acquisitions
The Company has recently completed the previously announced acquisition of
The Company expects to complete the previously announced acquisition of
VIE Enhancement
Due to PRC regulations that limit foreign equity ownership of entities providing value-added telecommunication services (“VATS”) to no more than 50%, and the inclusion of IDC services within the scope of VATS, GDS conducts a substantial part of its business in
In order to enhance corporate governance and facilitate administration of its VIEs, the Board of Directors (the “Board”) of GDS has decided to approve the transfer of ownership of the 100% equity interest of GDS Beijing and GDS Shanghai from
Initially, there will be five individual management shareholders, each holding 20% equity interest in Management HoldCo, namely
GDS believes that the proposed restructuring reduces risk by allocating ownership of its VIEs among a larger number of management shareholders, strengthens corporate governance with the establishment of the board of directors in the VIEs and its subsidiaries, and creates a more stable and self-sustaining ownership structure by removing reliance on a single or small number of natural persons, and placing the ownership of the VIEs within a larger number of people related to the Company with additional layer of legal entities, creating an institutional structure that is tied to the management and culture of GDS.
GDS has been advised that the proposed restructuring does not violate any applicable PRC laws or regulations and would not give rise to any material tax charges. The consolidation of the VIEs will not be affected under the relevant accounting rules.
The Board of GDS has approved the proposed restructuring. GDS has obtained all requisite consents from its lenders for the above restructuring pursuant to the relevant facility agreements and is currently proceeding with the required PRC regulatory filings and registrations for the proposed restructuring. The entire process is expected to be completed within approximately three months.
Updated Business Outlook
For the full year of 2019, the Company now expects its adjusted EBITDA to be in the range of
The previously revised guidance for total revenues of
This forecast reflects the Company’s current and preliminary view on the current business situation and market conditions, which are subject to change.
Conference Call
The Company’s management will host an earnings conference call at
| United States: | 1-845-675-0437 |
| International: | +65-6713-5090 |
| Hong Kong: | +852-3018-6771 |
| Mainland China: | 400-620-8038 |
| Conference ID: | 2649837 |
A live and archived webcast of the conference call will be available on the Company's investor relations website at investors.gds-services.com.
A telephone replay will be available approximately two hours after the call until
| United States: | 1-646-254-3697 |
| International: Hong Kong: Mainland China: |
+61-2-8199-0299 +852-3051-2780 400-632-2162 |
| Replay Access Code: | 2649837 |
Non-GAAP Disclosure
Our management and board of directors use adjusted NOI, adjusted NOI margin, adjusted EBITDA and adjusted EBITDA margin, which are non-GAAP financial measures, to evaluate our operating performance, establish budgets and develop operational goals for managing our business. In particular, we believe that the exclusion of the expenses eliminated in calculating adjusted NOI and adjusted EBITDA can provide a useful measure of our core operating performance.
We also present these non-GAAP measures because we believe these non-GAAP measures are frequently used by securities analysts, investors and other interested parties as measures of the financial performance of companies in our industry.
These non-GAAP financial measures are not defined under U.S. GAAP and are not presented in accordance with U.S. GAAP. These non-GAAP financial measures have limitations as analytical tools, and when assessing our operating performance, cash flows or our liquidity, investors should not consider them in isolation, or as a substitute for net income (loss), cash flows provided by (used in) operating activities or other consolidated statements of operations and cash flow data prepared in accordance with U.S. GAAP. There are a number of limitations related to the use of these non-GAAP financial measures instead of their nearest GAAP equivalent. First, adjusted EBITDA, adjusted EBITDA margin, adjusted NOI, and adjusted NOI margin are not substitutes for net income (loss), cash flows provided by (used in) operating activities or other consolidated statements of operation and cash flow data prepared in accordance with U.S. GAAP. Second, other companies may calculate these non-GAAP financial measures differently or may use other measures to evaluate their performance, all of which could reduce the usefulness of these non-GAAP financial measures as tools for comparison. Finally, these non-GAAP financial measures do not reflect the impact of net interest expenses, incomes tax benefits (expenses), depreciation and amortization, accretion expenses for asset retirement costs, and share-based compensation expenses, each of which have been and may continue to be incurred in our business.
We mitigate these limitations by reconciling the non-GAAP financial measure to the most comparable U.S. GAAP performance measure, all of which should be considered when evaluating our performance.
For more information on these non-GAAP financial measures, please see the table captioned “Reconciliations of GAAP and non-GAAP results” set forth at the end of this press release.
Exchange Rate
This announcement contains translations of certain RMB amounts into U.S. dollars (“USD”) at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to USD were made at the rate of
Statement Regarding Preliminary Unaudited Financial Information
The unaudited financial information set out in this earnings release is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company’s year-end audit, which could result in significant differences from this preliminary unaudited financial information.
About
Safe Harbor
This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “aim,” “anticipate,” “believe,” “continue,” “estimate,” “expect,” “future,” “guidance,” “intend,” “is/are likely to,” “may,” “ongoing,” “plan,” “potential,” “target,” “will,” and similar statements. Among other things, statements that are not historical facts, including statements about GDS Holdings’ beliefs and expectations regarding the growth of its businesses and its revenue for the full fiscal year, the business outlook and quotations from management in this announcement, as well as GDS Holdings’ strategic and operational plans, are or contain forward-looking statements.
For investor and media inquiries, please contact:
Phone: +86 (21) 2033-0295
Email: ir@gds-services.com
Phone: +86 (10) 6508-0677
Email: GDS@tpg-ir.com
Phone: +1 (212) 481-2050
Email: GDS@tpg-ir.com
| GDS HOLDINGS LIMITED | |||||||||
| UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | |||||||||
| (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) |
|||||||||
| As of December 31, 2018 |
As of September 30, 2019 | ||||||||
| RMB | RMB | US$ | |||||||
| Assets | |||||||||
| Current assets | |||||||||
| Cash | 2,161,622 | 5,752,790 | 804,845 | ||||||
| Accounts receivable, net of allowance for doubtful accounts | 536,842 | 952,184 | 133,215 | ||||||
| Value-added-tax (“VAT”) recoverable | 163,476 | 247,307 | 34,600 | ||||||
| Prepaid expenses and other current assets | 175,456 | 213,731 | 29,902 | ||||||
| Total current assets | 3,037,396 | 7,166,012 | 1,002,562 | ||||||
| Property and equipment, net | 13,994,945 | 16,290,301 | 2,279,097 | ||||||
| Prepaid land use rights, net | 756,957 | 774,564 | 108,365 | ||||||
| Operating lease right-of-use assets | 0 | 469,407 | 65,672 | ||||||
| Goodwill and intangible assets, net | 2,234,462 | 2,146,466 | 300,302 | ||||||
| Other non-current assets | 861,483 | 1,156,841 | 161,848 | ||||||
| Total assets | 20,885,243 | 28,003,591 | 3,917,846 | ||||||
| Liabilities, Redeemable Preferred Shares and Shareholders’ Equity | |||||||||
| Current liabilities | |||||||||
| Short-term borrowings and current portion of long-term borrowings | 1,283,320 | 916,596 | 128,236 | ||||||
| Accounts payable | 1,508,020 | 1,691,827 | 236,695 | ||||||
| Accrued expenses and other payables | 549,641 | 788,099 | 110,259 | ||||||
| Operating lease liabilities, current | 0 | 63,719 | 8,915 | ||||||
| Finance lease and other financing obligations, current | 166,898 | 118,050 | 16,516 | ||||||
| Total current liabilities | 3,507,879 | 3,578,291 | 500,621 | ||||||
| Long-term borrowings, excluding current portion | 5,203,708 | 7,442,030 | 1,041,178 | ||||||
| Convertible bonds payable | 2,004,714 | 2,075,014 | 290,305 | ||||||
| Operating lease liabilities, non-current | 0 | 379,789 | 53,134 | ||||||
| Finance lease and other financing obligations, non-current | 4,134,327 | 4,565,929 | 638,797 | ||||||
| Other long-term liabilities | 512,690 | 511,513 | 71,563 | ||||||
| Total liabilities | 15,363,318 | 18,552,566 | 2,595,598 | ||||||
| Redeemable preferred shares | 0 | 1,063,145 | 148,739 | ||||||
| Shareholders' equity | |||||||||
| Ordinary shares | 341 | 394 | 55 | ||||||
| Additional paid-in capital | 7,275,945 | 10,384,231 | 1,452,807 | ||||||
| Accumulated other comprehensive loss | (139,254 | ) | (43,217 | ) | (6,044 | ) | |||
| Accumulated deficit | (1,615,107 | ) | (1,953,528 | ) | (273,309 | ) | |||
| Total shareholders’ equity | 5,521,925 | 8,387,880 | 1,173,509 | ||||||
| Commitments and contingencies | |||||||||
| Total liabilities, redeemable preferred shares and shareholders' equity | 20,885,243 | 28,003,591 | 3,917,846 | ||||||
Note: Effective
| GDS HOLDINGS LIMITED | ||||||||||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
| (Amount in thousands of Renminbi ("RMB") and US dollars ("US$") | ||||||||||||||||
| except for number of shares and per share data) | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2018 |
June 30, 2019 | September 30, 2019 | September 30, 2018 |
September 30, 2019 | ||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Net revenue | ||||||||||||||||
| Service revenue | 752,620 | 985,094 | 1,058,921 | 148,148 | 1,930,440 | 2,934,961 | 410,616 | |||||||||
| Equipment sales | 10,201 | 95 | 7,267 | 1,017 | 32,116 | 8,257 | 1,155 | |||||||||
| Total net revenue | 762,821 | 985,189 | 1,066,188 | 149,165 | 1,962,556 | 2,943,218 | 411,771 | |||||||||
| Cost of revenue | (590,956 | ) | (723,420 | ) | (791,963 | ) | (110,800 | ) | (1,530,253 | ) | (2,195,215 | ) | (307,122 | ) | ||
| Gross profit | 171,865 | 261,769 | 274,225 | 38,365 | 432,303 | 748,003 | 104,649 | |||||||||
| Operating expenses | ||||||||||||||||
| Selling and marketing expenses | (29,320 | ) | (29,805 | ) | (32,596 | ) | (4,560 | ) | (78,301 | ) | (90,233 | ) | (12,624 | ) | ||
| General and administrative expenses | (89,267 | ) | (94,702 | ) | (105,524 | ) | (14,763 | ) | (238,940 | ) | (290,527 | ) | (40,646 | ) | ||
| Research and development expenses | (3,318 | ) | (4,200 | ) | (6,193 | ) | (866 | ) | (9,191 | ) | (15,032 | ) | (2,103 | ) | ||
| Income from operations | 49,960 | 133,062 | 129,912 | 18,176 | 105,871 | 352,211 | 49,276 | |||||||||
| Other income (expenses): | ||||||||||||||||
| Net interest expenses | (182,152 | ) | (221,906 | ) | (241,038 | ) | (33,722 | ) | (434,480 | ) | (682,061 | ) | (95,424 | ) | ||
| Foreign currency exchange gain (loss), net | 13,420 | (7,530 | ) | (2,796 | ) | (391 | ) | 19,979 | (5,554 | ) | (777 | ) | ||||
| Others, net | 3,197 | 2,017 | 4,602 | 644 | 5,709 | 9,122 | 1,276 | |||||||||
| Loss before income taxes | (115,575 | ) | (94,357 | ) | (109,320 | ) | (15,293 | ) | (302,921 | ) | (326,282 | ) | (45,649 | ) | ||
| Income tax (expenses) benefits | (3,779 | ) | 1,198 | 678 | 95 | (4,436 | ) | (12,139 | ) | (1,698 | ) | |||||
| Net loss | (119,354 | ) | (93,159 | ) | (108,642 | ) | (15,198 | ) | (307,357 | ) | (338,421 | ) | (47,347 | ) | ||
| Change in redemption value of redeemable preferred shares | 0 | 0 | 0 | 0 | 0 | (17,760 | ) | (2,485 | ) | |||||||
| Cumulative dividend on preferred shares | 0 | (12,913 | ) | (13,386 | ) | (1,873 | ) | 0 | (26,858 | ) | (3,758 | ) | ||||
| Net loss attributable to ordinary shareholders | (119,354 | ) | (106,072 | ) | (122,028 | ) | (17,071 | ) | (307,357 | ) | (383,039 | ) | (53,590 | ) | ||
| Loss per ordinary share | ||||||||||||||||
| Basic and diluted | (0.12 | ) | (0.10 | ) | (0.11 | ) | (0.02 | ) | (0.31 | ) | (0.35 | ) | (0.05 | ) | ||
| Weighted average number of ordinary share outstanding | ||||||||||||||||
| Basic and diluted | 997,967,316 | 1,115,624,250 | 1,126,969,256 | 1,126,969,256 | 986,825,604 | 1,089,589,663 | 1,089,589,663 | |||||||||
| GDS HOLDINGS LIMITED | ||||||||||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS | ||||||||||||||||
| (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2018 |
June 30, 2019 | September 30, 2019 | September 30, 2018 |
September 30, 2019 | ||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Net loss | (119,354 | ) | (93,159 | ) | (108,642 | ) | (15,198 | ) | (307,357 | ) | (338,421 | ) | (47,347 | ) | ||
| Foreign currency translation adjustments, net of nil tax | 26,602 | 47,519 | 29,165 | 4,080 | 58,103 | 96,037 | 13,436 | |||||||||
| Comprehensive loss | (92,752 | ) | (45,640 | ) | (79,477 | ) | (11,118 | ) | (249,254 | ) | (242,384 | ) | (33,911 | ) | ||
| GDS HOLDINGS LIMITED | |||||||||||||||
| UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||||||||
| (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) | |||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||
| September 30, 2018 |
June 30, 2019 | September 30, 2019 | September 30, 2018 |
September 30, 2019 | |||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||||
| Net loss | (119,354 | ) | (93,159 | ) | (108,642 | ) | (15,198 | ) | (307,357 | ) | (338,421 | ) | (47,347 | ) | |
| Depreciation and amortization | 206,661 | 269,176 | 299,349 | 41,880 | 510,908 | 822,562 | 115,081 | ||||||||
| Amortization of debt issuance cost and debt discount | 15,956 | 36,522 | 31,992 | 4,476 | 33,223 | 85,504 | 11,962 | ||||||||
| Share-based compensation expense | 27,358 | 30,977 | 51,886 | 7,259 | 70,945 | 114,820 | 16,064 | ||||||||
| Others | (2,411 | ) | (15,913 | ) | (19,435 | ) | (2,719 | ) | (3,870 | ) | (40,508 | ) | (5,668 | ) | |
| Changes in operating assets and liabilities | (90,750 | ) | (111,693 | ) | (89,931 | ) | (12,581 | ) | (428,126 | ) | (422,634 | ) | (59,128 | ) | |
| Net cash provided by (used in) operating activities | 37,460 | 115,910 | 165,219 | 23,117 | (124,277 | ) | 221,323 | 30,964 | |||||||
| Purchase of property and equipment | (965,555 | ) | (517,034 | ) | (1,114,350 | ) | (155,903 | ) | (2,596,492 | ) | (2,460,830 | ) | (344,283 | ) | |
| Payments related to acquisitions and investments | (110,556 | ) | (22,113 | ) | (36,090 | ) | (5,049 | ) | (443,850 | ) | (63,203 | ) | (8,842 | ) | |
| Net cash used in investing activities | (1,076,111 | ) | (539,147 | ) | (1,150,440 | ) | (160,952 | ) | (3,040,342 | ) | (2,524,033 | ) | (353,125 | ) | |
| Net proceeds from financing activities | 1,066 | (20,334 | ) | 887,546 | 124,171 | 4,613,206 | 5,656,923 | 791,431 | |||||||
| Net cash provided by (used in) financing activities | 1,066 | (20,334 | ) | 887,546 | 124,171 | 4,613,206 | 5,656,923 | 791,431 | |||||||
| Effect of exchange rate changes on cash and restricted cash | 115,650 | 122,535 | 109,558 | 15,327 | 211,181 | 222,878 | 31,184 | ||||||||
| Net (decrease) increase of cash and restricted cash | (921,935 | ) | (321,036 | ) | 11,883 | 1,663 | 1,659,768 | 3,577,091 | 500,454 | ||||||
| Cash and restricted cash at beginning of period | 4,529,303 | 6,170,992 | 5,849,956 | 818,439 | 1,947,600 | 2,284,748 | 319,648 | ||||||||
| Cash and restricted cash at end of period | 3,607,368 | 5,849,956 | 5,861,839 | 820,102 | 3,607,368 | 5,861,839 | 820,102 | ||||||||
| GDS HOLDINGS LIMITED | ||||||||||||||||
| UNAUDITED RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS | ||||||||||||||||
| (Amount in thousands of Renminbi ("RMB") and US dollars ("US$") | ||||||||||||||||
| except for percentage data) | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2018 |
June 30, 2019 | September 30, 2019 | September 30, 2018 |
September 30, 2019 | ||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Net loss | (119,354 | ) | (93,159 | ) | (108,642 | ) | (15,198 | ) | (307,357 | ) | (338,421 | ) | (47,347 | ) | ||
| Net interest expenses | 182,152 | 221,906 | 241,038 | 33,722 | 434,480 | 682,061 | 95,424 | |||||||||
| Income tax expenses (benefits) | 3,779 | (1,198 | ) | (678 | ) | (95 | ) | 4,436 | 12,139 | 1,698 | ||||||
| Depreciation and amortization | 206,661 | 269,176 | 299,349 | 41,880 | 510,908 | 822,562 | 115,081 | |||||||||
| Accretion expenses for asset retirement costs | 569 | 723 | 743 | 104 | 1,285 | 2,177 | 305 | |||||||||
| Share-based compensation expenses | 27,358 | 30,977 | 51,886 | 7,259 | 70,945 | 114,820 | 16,064 | |||||||||
| Selling and marketing expenses (1) | 22,206 | 22,610 | 22,330 | 3,124 | 61,860 | 65,270 | 9,132 | |||||||||
| General and administrative expenses (1) | 57,319 | 61,898 | 61,676 | 8,629 | 150,595 | 180,664 | 25,275 | |||||||||
| Research and development expenses (1) | 2,829 | 3,477 | 5,144 | 720 | 8,262 | 12,591 | 1,762 | |||||||||
| Foreign currency exchange loss (gain), net | (13,420 | ) | 7,530 | 2,796 | 391 | (19,979 | ) | 5,554 | 777 | |||||||
| Others, net | (3,197 | ) | (2,017 | ) | (4,602 | ) | (644 | ) | (5,709 | ) | (9,122 | ) | (1,276 | ) | ||
| Adjusted NOI | 366,902 | 521,923 | 571,040 | 79,892 | 909,726 | 1,550,295 | 216,895 | |||||||||
| Adjusted NOI margin | 48.1% | 53.0% | 53.6% | 53.6% | 46.4% | 52.7% | 52.7% | |||||||||
Note 1:
Selling and marketing expenses, general and administrative expenses and research and development expenses exclude depreciation, amortization and share-based compensation expenses.
| GDS HOLDINGS LIMITED | ||||||||||||||||||||
| UNAUDITED RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS | ||||||||||||||||||||
| (Amount in thousands of Renminbi ("RMB") and US dollars ("US$") | ||||||||||||||||||||
| except for percentage data) | ||||||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||||||
| September 30, 2018 | June 30, 2019 | September 30, 2019 | September 30, 2018 | September 30, 2019 | ||||||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||||||
| Net loss | (119,354 | ) | (93,159 | ) | (108,642 | ) | (15,198 | ) | (307,357 | ) | (338,421 | ) | (47,347 | ) | ||||||
| Net interest expenses | 182,152 | 221,906 | 241,038 | 33,722 | 434,480 | 682,061 | 95,424 | |||||||||||||
| Income tax expenses (benefits) | 3,779 | (1,198 | ) | (678 | ) | (95 | ) | 4,436 | 12,139 | 1,698 | ||||||||||
| Depreciation and amortization | 206,661 | 269,176 | 299,349 | 41,880 | 510,908 | 822,562 | 115,081 | |||||||||||||
| Accretion expenses for asset retirement costs | 569 | 723 | 743 | 104 | 1,285 | 2,177 | 305 | |||||||||||||
| Share-based compensation expenses | 27,358 | 30,977 | 51,886 | 7,259 | 70,945 | 114,820 | 16,064 | |||||||||||||
| Adjusted EBITDA | 301,165 | 428,425 | 483,696 | 67,672 | 714,697 | 1,295,338 | 181,225 | |||||||||||||
| Adjusted EBITDA margin | 39.5% | 43.5% | 45.4% | 45.4% | 36.4% | 44.0% | 44.0% | |||||||||||||
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(1) We previously referred to our three existing data centers on this site using the initial letters HB. Henceforth, we will refer to all of our data centers on this site using the initial letters ZB.
Source: GDS Holdings Limited