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Iron Mountain's (IRM) Q1 AFFO & Revenues Surpass Estimates
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Iron Mountain Incorporated (IRM - Free Report) reported first-quarter adjusted funds from operations (AFFO) per share of 97 cents, which surpassed the Zacks Consensus Estimate of 93 cents and our estimate of 92 cents. Moreover, the figure improved 6.6% from the year-ago quarter’s 91 cents, attributable to improved adjusted EBITDA.
Iron Mountain’s results reflect solid performance in the storage and service segments, and the data-center business. However, higher operating expenses in the quarter acted as a dampener. The company reaffirmed its outlook for 2023.
Quarterly total revenues of $1.314 billion beat the Zacks Consensus Estimate and our estimate of $1.313 billion. The reported figure increased 5.3% year over year.
According to William L. Meaney, president and CEO of Iron Mountain, “We are pleased to report another quarter of record revenue. Our continued strength, in spite of the turbulent geopolitical and economic times in which we find ourselves, reflects the resilience of our business model and the steadfast commitment of our outstanding team.”
Behind the Headlines
Storage rental revenues were $810.1 million in the first quarter, up 7.9% year over year. Also, service revenues amounted to $504.3 million, reflecting a rise of 1.5%.
In the reported quarter, operating expenses flared up 4.7% year over year to $1.07 billion.
The Global Data Center business reported revenues of $112.3 million in first-quarter 2023, rising 15.8% year over year.
The adjusted EBITDA improved 6.9% year over year to $460.8 million in the quarter. The adjusted EBITDA margin expanded 60 basis points to 35.1%.
Balance Sheet Position
IRM exited the first quarter with $146.4 million of cash and cash equivalents, up from $141.8 million as of Dec 31, 2022.
Dividend Update
Concurrent with the first-quarter earnings release, IRM announced its quarterly cash dividend of 61.85 cents per share on its common stock for second-quarter 2023. The dividend will be paid out on Jul 6 to its shareholders of record as of Jun 15, 2023.
2023 Guidance
Iron Mountain reaffirmed its guidance for 2023.
It projects an adjusted FFO per share of $3.91-$4.00 for the full year. The Zacks Consensus Estimate for the same is currently pegged at $3.96, which lies within the company’s guided range.
Revenues are estimated to be $5,500 -$5,600 million, while adjusted EBITDA is anticipated to be $1,940-$1,975 million.
Boston Properties Inc.’s (BXP - Free Report) first-quarter 2023 FFO per share of $1.73 outpaced the Zacks Consensus Estimate of $1.70. It also surpassed our estimate of $1.68. However, the reported figure fell 4.9% year over year.
BXP’s quarterly results reflected better-than-anticipated revenues on healthy leasing activity. However, the company noted that higher interest expenses during the quarter marred its year-over-year FFO per share growth. BXP raised its outlook for 2023 FFO per share.
Digital Realty Trust (DLR - Free Report) reported first-quarter 2023 core FFO per share of $1.66, beating the Zacks Consensus Estimate by a whisker. The figure, however, fell short of the year-ago quarter’s $1.67.
The company experienced year-over-year growth in operating revenues during the quarter. However, rising rental property operating expenses acted as a dampener. DLR maintained its guidance for 2023 core FFO per share but lowered its expectations for full-year revenues.
SBA Communications Corporation (SBAC - Free Report) reported first-quarter 2023 AFFO per share of $3.13, outpacing the Zacks Consensus Estimate of $3.11. Moreover, the figure reflects a rise of 5.7% from the prior-year quarter.
SBAC’s site-leasing revenues improved year-over-year on healthy leasing activity amid elevated tower space demand. Moreover, it has continued to benefit from the addition of sites to its portfolio. The company also raised its 2023 outlook.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.
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Iron Mountain's (IRM) Q1 AFFO & Revenues Surpass Estimates
Iron Mountain Incorporated (IRM - Free Report) reported first-quarter adjusted funds from operations (AFFO) per share of 97 cents, which surpassed the Zacks Consensus Estimate of 93 cents and our estimate of 92 cents. Moreover, the figure improved 6.6% from the year-ago quarter’s 91 cents, attributable to improved adjusted EBITDA.
Iron Mountain’s results reflect solid performance in the storage and service segments, and the data-center business. However, higher operating expenses in the quarter acted as a dampener. The company reaffirmed its outlook for 2023.
Quarterly total revenues of $1.314 billion beat the Zacks Consensus Estimate and our estimate of $1.313 billion. The reported figure increased 5.3% year over year.
According to William L. Meaney, president and CEO of Iron Mountain, “We are pleased to report another quarter of record revenue. Our continued strength, in spite of the turbulent geopolitical and economic times in which we find ourselves, reflects the resilience of our business model and the steadfast commitment of our outstanding team.”
Behind the Headlines
Storage rental revenues were $810.1 million in the first quarter, up 7.9% year over year. Also, service revenues amounted to $504.3 million, reflecting a rise of 1.5%.
In the reported quarter, operating expenses flared up 4.7% year over year to $1.07 billion.
The Global Data Center business reported revenues of $112.3 million in first-quarter 2023, rising 15.8% year over year.
The adjusted EBITDA improved 6.9% year over year to $460.8 million in the quarter. The adjusted EBITDA margin expanded 60 basis points to 35.1%.
Balance Sheet Position
IRM exited the first quarter with $146.4 million of cash and cash equivalents, up from $141.8 million as of Dec 31, 2022.
Dividend Update
Concurrent with the first-quarter earnings release, IRM announced its quarterly cash dividend of 61.85 cents per share on its common stock for second-quarter 2023. The dividend will be paid out on Jul 6 to its shareholders of record as of Jun 15, 2023.
2023 Guidance
Iron Mountain reaffirmed its guidance for 2023.
It projects an adjusted FFO per share of $3.91-$4.00 for the full year. The Zacks Consensus Estimate for the same is currently pegged at $3.96, which lies within the company’s guided range.
Revenues are estimated to be $5,500 -$5,600 million, while adjusted EBITDA is anticipated to be $1,940-$1,975 million.
Iron Mountain currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Iron Mountain Incorporated Price, Consensus and EPS Surprise
Iron Mountain Incorporated price-consensus-eps-surprise-chart | Iron Mountain Incorporated Quote
Performance of Other REITs
Boston Properties Inc.’s (BXP - Free Report) first-quarter 2023 FFO per share of $1.73 outpaced the Zacks Consensus Estimate of $1.70. It also surpassed our estimate of $1.68. However, the reported figure fell 4.9% year over year.
BXP’s quarterly results reflected better-than-anticipated revenues on healthy leasing activity. However, the company noted that higher interest expenses during the quarter marred its year-over-year FFO per share growth. BXP raised its outlook for 2023 FFO per share.
Digital Realty Trust (DLR - Free Report) reported first-quarter 2023 core FFO per share of $1.66, beating the Zacks Consensus Estimate by a whisker. The figure, however, fell short of the year-ago quarter’s $1.67.
The company experienced year-over-year growth in operating revenues during the quarter. However, rising rental property operating expenses acted as a dampener. DLR maintained its guidance for 2023 core FFO per share but lowered its expectations for full-year revenues.
SBA Communications Corporation (SBAC - Free Report) reported first-quarter 2023 AFFO per share of $3.13, outpacing the Zacks Consensus Estimate of $3.11. Moreover, the figure reflects a rise of 5.7% from the prior-year quarter.
SBAC’s site-leasing revenues improved year-over-year on healthy leasing activity amid elevated tower space demand. Moreover, it has continued to benefit from the addition of sites to its portfolio. The company also raised its 2023 outlook.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.