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Iron Mountain's (IRM) Q4 AFFO Beat Estimates, Revenues Rise Y/Y
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Iron Mountain Incorporated (IRM - Free Report) reported fourth-quarter adjusted funds from operations (AFFO) per share of $1.11 cents, beating the Zacks Consensus Estimate of $1.05.
Iron Mountain’s results reflect solid performances in the storage and service segments and the data-center business. However, higher interest expenses in the quarter created a headwind. The company issued its outlook for 2024.
Quarterly total revenues of $1.42 billion lagged the Zacks Consensus Estimate of $1.44 billion.
On a year-over-year basis, AFFO per share and total revenues increased 8.8% and 11%, respectively.
According to William L. Meaney, president and CEO of Iron Mountain, “We are well positioned to continue our growth trajectory in 2024, which is reflected in our financial guidance for double-digit revenue growth. Our Project Matterhorn initiative is propelling us on our growth journey.”
For the full year, IRM reported AFFO per share of $4.12, up from $3.93 reported in 2022. The figure also beat the Zacks Consensus Estimate of $3.95. Revenues of $5.48 billion climbed 7.4% year over year but lagged the consensus mark of $5.50 billion.
Behind the Headlines
Storage rental revenues were $871.4 million in the fourth quarter, up 1.5% year over year. We had estimated quarterly storage rental revenues of $868.8 million.
Service revenues increased 3.6% from the prior-year quarter to $548.7 million. Our estimate was pegged at $573.1 million.
The Global Data Center business reported revenues of $137.2 million in the fourth quarter, rising 32.2% year over year.
The adjusted EBITDA rose 11.3% year over year to $525.2 million. The adjusted EBITDA margin expanded 10 basis points to 37%.
However, interest expenses flared up 11% year over year to $151.8 million in the quarter.
Balance-Sheet Position
IRM exited the fourth quarter with $222.8 million of cash and cash equivalents, up from $170.5 million as of Sep 30, 2023.
Dividend Update
Concurrently, IRM announced a quarterly cash dividend of 65 cents per share for the first quarter of 2024. The dividend will be paid out on Apr 4, 2024, to its shareholders on record as of Mar 15, 2024.
2024 Guidance
Iron Mountain provided its guidance for 2024.
It expects AFFO per share of $4.39-$4.51. The Zacks Consensus Estimate for the same is pegged at $4.23, which lies below the company’s guided range.
Revenues are estimated to be $6.00-$6.15 billion, while adjusted EBITDA is anticipated to be $2.175-$2.225 billion.
Ventas, Inc. (VTR - Free Report) reported a fourth-quarter 2023 normalized funds from operations (FFO) per share of 76 cents, in line with the Zacks Consensus Estimate. The reported figure increased 4.1% from the prior-year quarter’s tally.
Results reflect better-than-anticipated revenues. Also, Ventas’ same-store cash NOI increased year over year on strong performance across the portfolio.
Healthpeak Properties, Inc. reported fourth-quarter 2023 FFO as adjusted per share of 46 cents, beating the Zacks Consensus Estimate by a whisker. The reported figure rose 4.5% year over year.
Results reflected better-than-anticipated revenues. Moreover, growth in same-store portfolio cash (adjusted) net operating income was witnessed across the portfolio. The company also issued its 2024 outlook.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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Iron Mountain's (IRM) Q4 AFFO Beat Estimates, Revenues Rise Y/Y
Iron Mountain Incorporated (IRM - Free Report) reported fourth-quarter adjusted funds from operations (AFFO) per share of $1.11 cents, beating the Zacks Consensus Estimate of $1.05.
Iron Mountain’s results reflect solid performances in the storage and service segments and the data-center business. However, higher interest expenses in the quarter created a headwind. The company issued its outlook for 2024.
Quarterly total revenues of $1.42 billion lagged the Zacks Consensus Estimate of $1.44 billion.
On a year-over-year basis, AFFO per share and total revenues increased 8.8% and 11%, respectively.
According to William L. Meaney, president and CEO of Iron Mountain, “We are well positioned to continue our growth trajectory in 2024, which is reflected in our financial guidance for double-digit revenue growth. Our Project Matterhorn initiative is propelling us on our growth journey.”
For the full year, IRM reported AFFO per share of $4.12, up from $3.93 reported in 2022. The figure also beat the Zacks Consensus Estimate of $3.95. Revenues of $5.48 billion climbed 7.4% year over year but lagged the consensus mark of $5.50 billion.
Behind the Headlines
Storage rental revenues were $871.4 million in the fourth quarter, up 1.5% year over year. We had estimated quarterly storage rental revenues of $868.8 million.
Service revenues increased 3.6% from the prior-year quarter to $548.7 million. Our estimate was pegged at $573.1 million.
The Global Data Center business reported revenues of $137.2 million in the fourth quarter, rising 32.2% year over year.
The adjusted EBITDA rose 11.3% year over year to $525.2 million. The adjusted EBITDA margin expanded 10 basis points to 37%.
However, interest expenses flared up 11% year over year to $151.8 million in the quarter.
Balance-Sheet Position
IRM exited the fourth quarter with $222.8 million of cash and cash equivalents, up from $170.5 million as of Sep 30, 2023.
Dividend Update
Concurrently, IRM announced a quarterly cash dividend of 65 cents per share for the first quarter of 2024. The dividend will be paid out on Apr 4, 2024, to its shareholders on record as of Mar 15, 2024.
2024 Guidance
Iron Mountain provided its guidance for 2024.
It expects AFFO per share of $4.39-$4.51. The Zacks Consensus Estimate for the same is pegged at $4.23, which lies below the company’s guided range.
Revenues are estimated to be $6.00-$6.15 billion, while adjusted EBITDA is anticipated to be $2.175-$2.225 billion.
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
Ventas, Inc. (VTR - Free Report) reported a fourth-quarter 2023 normalized funds from operations (FFO) per share of 76 cents, in line with the Zacks Consensus Estimate. The reported figure increased 4.1% from the prior-year quarter’s tally.
Results reflect better-than-anticipated revenues. Also, Ventas’ same-store cash NOI increased year over year on strong performance across the portfolio.
Healthpeak Properties, Inc. reported fourth-quarter 2023 FFO as adjusted per share of 46 cents, beating the Zacks Consensus Estimate by a whisker. The reported figure rose 4.5% year over year.
Results reflected better-than-anticipated revenues. Moreover, growth in same-store portfolio cash (adjusted) net operating income was witnessed across the portfolio. The company also issued its 2024 outlook.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.