GDS Holdings Limited Reports Third Quarter 2021 Results
GDS Holdings Limited reported a robust third quarter for 2021, with net revenue rising by 35.2% year-over-year to RMB2,061.4 million (US$319.9 million). Service revenue also increased by 35.4% year-over-year, but the company faced a net loss of RMB301.1 million (US$46.7 million), compared to RMB204.6 million in Q3 2020. Adjusted EBITDA grew by 34.2% to RMB962.2 million (US$149.3 million) with an adjusted EBITDA margin of 46.7%. The company experienced an increase in committed data center space by 32.1% year-over-year to 531,760 sqm.
- Net revenue increased by 35.2% Y-o-Y to RMB2,061.4 million (US$319.9 million).
- Service revenue rose by 35.4% Y-o-Y to RMB2,061.1 million (US$319.9 million).
- Adjusted EBITDA increased by 34.2% Y-o-Y to RMB962.2 million (US$149.3 million).
- Total area committed and pre-committed grew by 32.1% Y-o-Y to 531,760 sqm.
- Net loss was RMB301.1 million (US$46.7 million) compared to a loss of RMB204.6 million in Q3 2020.
- Adjusted EBITDA margin decreased to 46.7% from 47.0% in Q3 2020.
- Cost of revenue increased by 43.9% Y-o-Y to RMB1,606.0 million (US$249.2 million).
- Gross profit margin declined to 22.1% from 26.8% in Q3 2020.
SHANGHAI, China, Nov. 16, 2021 (GLOBE NEWSWIRE) -- GDS Holdings Limited (“GDS Holdings”, “GDS” or the “Company”) (NASDAQ: GDS; HKEX: 9698), a leading developer and operator of high-performance data centers in China, today announced its unaudited financial results for the third quarter ended September 30, 2021.
Third Quarter 2021 Financial Highlights
- Net revenue increased by
35.2% year-over-year (“Y-o-Y”) to RMB2,061.4 million (US$319.9 million ) in the third quarter of 2021 (3Q2020: RMB1,524.7 million). - Service revenue increased by
35.4% Y-o-Y to RMB2,061.1 million (US$319.9 million ) in the third quarter of 2021 (3Q2020: RMB1,522.4 million). - Net loss was RMB301.1 million (US
$46.7 million ) in the third quarter of 2021, compared with a net loss of RMB204.6 million in the third quarter of 2020. - Adjusted EBITDA (non-GAAP) increased by
34.2% Y-o-Y to RMB962.2 million (US$149.3 million ) in the third quarter of 2021 (3Q2020: RMB717.1 million). See “Non-GAAP Disclosure” and “Reconciliations of GAAP and non-GAAP results” elsewhere in this earnings release. - Adjusted EBITDA margin (non-GAAP) decreased to
46.7% in the third quarter of 2021 (3Q2020:47.0% ).
Operating Highlights1
- Total area committed and pre-committed by customers increased by 26,611 square meters (“sqm”) in the third quarter of 2021 to 531,760 sqm as of September 30, 2021, an increase of
32.1% Y-o-Y (September 30, 2020: 402,562 sqm). - Area in service increased by 27,811 sqm in the third quarter of 2021 to 452,830 sqm as of September 30, 2021, an increase of
55.5% Y-o-Y (September 30, 2020: 291,282 sqm). - Commitment rate for area in service was
95.9% as of September 30, 2021 (September 30, 2020:95.9% ). - Area under construction was 157,227 sqm as of September 30, 2021 (September 30, 2020: 169,424 sqm).
- Pre-commitment rate for area under construction was
62.1% as of September 30, 2021 (September 30, 2020:72.7% ). - Area utilized by customers increased by 18,678 sqm in the third quarter of 2021 to 300,328 sqm as of September 30, 2021, an increase of
38.9% Y-o-Y (September 30, 2020: 216,154 sqm). - Utilization rate for area in service was
66.3% as of September 30, 2021 (September 30, 2020:74.2% ).
“We recorded another solid quarter with sustained growth,” said Mr. William Huang, Chairman and Chief Executive Officer. “During the third quarter, our sales momentum continued with over 26,000 sqm of new bookings. We have secured more valuable resources in Tier 1 markets through acquisitions, further strengthening our market leading position.”
“We continued our steady financial performance in the third quarter, achieving Y-o-Y revenue growth of
Third Quarter 2021 Financial Results
Net revenue in the third quarter of 2021 was RMB2,061.4 million (US
Cost of revenue in the third quarter of 2021 was RMB1,606.0 million (US
Gross profit was RMB455.4 million (US
Gross profit margin was
Adjusted Gross Profit2 (“Adjusted GP”) (non-GAAP) is defined as gross profit excluding depreciation and amortization, operating lease cost relating to prepaid land use rights, accretion expenses for asset retirement costs and share-based compensation expenses allocated to cost of revenue. Adjusted GP was RMB1,083.1 million (US
Adjusted GP margin (non-GAAP) was
Selling and marketing expenses, excluding share-based compensation expenses of RMB11.2 million (US
General and administrative expenses, excluding share-based compensation expenses of RMB53.0 million (US
Research and development costs were RMB9.0 million (US
Net interest expenses for the third quarter of 2021 were RMB392.1 million (US
Foreign currency exchange loss for the third quarter of 2021 was RMB3.9 million (US
Others, net for the third quarter of 2021 was RMB14.7 million (US
Net loss in the third quarter of 2021 was RMB301.1 million (US
Adjusted EBITDA (non-GAAP) is defined as net loss excluding net interest expenses, income tax expenses (benefits), depreciation and amortization, operating lease cost relating to prepaid land use rights, accretion expenses for asset retirement costs, share-based compensation expenses and gain from purchase price adjustment. Adjusted EBITDA was RMB962.2 million (US
Adjusted EBITDA margin (non-GAAP) was
Basic and diluted loss per ordinary share in the third quarter of 2021 was RMB0.23 (US
Basic and diluted loss per American Depositary Share (“ADS”) in the third quarter of 2021 was RMB1.85 (US
Sales
Total area committed and pre-committed at the end of the third quarter of 2021 was 531,760 sqm, compared with 402,562 sqm at the end of the third quarter of 2020 and 505,148 sqm at the end of the second quarter of 2021, an increase of
Data Center Resources
Area in service at the end of the third quarter of 2021 was 452,830 sqm, compared with 291,282 sqm at the end of the third quarter of 2020 and 425,019 sqm at the end of the second quarter of 2021, an increase of
Area under construction at the end of the third quarter of 2021 was 157,227 sqm, compared with 169,424 sqm at the end of the third quarter of 2020 and 165,175 sqm at the end of the second quarter of 2021, a decrease of
- LF14 is the second and final data center which is being constructed on Langfang Land Site 2, next to the first data center on the same site, Langfang 13 (“LF13”). LF14 will yield a net floor area of 6,904 sqm and is expected to come into service in the first half of 2023.
- HK2 is the second industrial building in Hong Kong, acquired by the Company in late 2019, which is currently being re-developed into a data center. HK2 is located in Kwai Chung, a major data center hub in Hong Kong, and is only 150 meters from the Hong Kong 1 (“HK1”) data center. HK2 will yield a net floor area of 7,440 sqm, and is expected to be delivered in the first half of 2024.
Commitment rate for area in service was
Area utilized at the end of the third quarter of 2021 was 300,328 sqm, compared with 216,154 sqm at the end of the third quarter of 2020 and 281,650 sqm at the end of the second quarter of 2021, an increase of
Utilization rate for area in service was
During the third quarter, as previously announced, the Company completed the acquisition of three data centers on a single site in Beijing, namely BJ17, BJ18 and Beijing 19 (“BJ19”). BJ17 and BJ18 have an aggregate net floor area of 3,698 sqm and are fully operational, with current aggregate utilization rate of over
During the third quarter, the Company also completed the previously announced acquisition of an industrial building in Kwai Chung, Hong Kong, which the Company will re-develop into Hong Kong 4 (“HK4”) data center. HK4 is located in close proximity to the Company’s HK1 and HK2 data centers, forming a unique cluster in the Kwai Chung area. HK4 will yield a net floor area of approximately 7,200 sqm according to the initial design. It is expected to enter service in 2025.
During the third quarter, as previously announced, the Company signed an agreement to form a joint venture (“JV”) with a local partner for the development of a data center in Macau (“MC1”). GDS will own
During the third quarter, as previously announced, the Company entered into a definitive agreement to acquire a greenfield site in the Nusajaya Tech Park, Johor, Malaysia. The Company intends to develop the site into a data center campus comprising a total net floor area of approximately 18,000 sqm or 54 MW of total IT power capacity. The first phase of the development is expected to enter service in 2024.
During the third quarter, the Company entered into a new master joint venture investment agreement with RECO GIGA Private Limited, a subsidiary of GIC (Realty) Pte Ltd (“GIC”), pursuant to which the two parties will form joint ventures for the investment and development of designated Build-Operate-Transfer (“B-O-T”) data centers. According to the new agreement, GDS will own
Liquidity
As of September 30, 2021, cash was RMB10,103.6 million (US
Recent Developments
New Acquisition – Beijing 20, Beijing 21, Beijing 22 and Beijing 23
The Company recently entered into a definitive agreement to acquire
New Acquisition – Wuhan 1 and Wuhan 2
The Company recently entered into a definitive agreement to acquire
New Acquisition – Shenzhen 9
The company recently entered into a definitive agreement to acquire
New Acquisition – Portfolio of Data Center Development Projects in Guangdong
The Company recently entered into a definitive agreement to acquire a regional data center company (the “Target”) which holds a portfolio of data center development projects located at several sites in Guangdong Province. The counterparty for this acquisition is the same as for SZ9. GDS will initially acquire a minority equity interest in the Target, and will subsequently acquire all the remaining equity interest in phases when certain conditions are met. The Target’s portfolio has a total developable net floor area of over 100,000 sqm, or a total developable IT power capacity of over 250 MW, all with required energy quota. The projects in the portfolio are either at an early stage of development or held for future development. The Company expects to close the acquisition of the initial equity interest in the next couple of quarters, subject to customary closing conditions.
Land Purchase in Nongsa Digital Park, Batam, Indonesia
The Company has recently entered into a definitive agreement to acquire greenfield land in the Nongsa Digital Park, located in Batam, Indonesia, approximately 25 kms from Singapore. The Company plans to construct two new data center buildings on the site, comprising a total net floor area of approximately 10,000 sqm or 28 MW of total IT power capacity. The Company expects to secure a supply of renewable energy to support the data center site. The development of a data center campus in Nongsa Digital Park will complement the Company’s existing project in the Nusajaya Tech Park, Johor Bahru, Malaysia forming a strong core for its “Singapore Plus” strategy in the region.
Business Outlook
As a result of a slower move-in rate in the second half of 2021 relative to the Company’s original expectations and recent increases in power costs, the Company now expects total revenue and adjusted EBITDA for the full year of 2021 to be in the lower half of the originally provided guidance ranges of RMB7,700 – RMB8,000 million for total revenue and RMB3,660 – RMB3,800 million for adjusted EBITDA. Accordingly, the Company’s revised guidance is RMB7,700 – RMB7,850 million for total revenue and RMB3,660 – RMB3,730 million for adjusted EBITDA.
In order to strengthen its market position, the Company has accelerated the acquisition of data center projects and the purchase of development land and buildings in the second half of 2021. Based on the estimated closing dates for these transactions and the amount of consideration payable in the current year, the Company now expects its capex to be around RMB16,000 million for the full year of 2021, compared with the previously provided guidance of around RMB12,000 million.
This forecast reflects the Company’s preliminary view on the current business situation and market conditions, which are subject to change.
Conference Call
Management will hold a conference call at 8:00 a.m. U.S. Eastern Time on November 16, 2021 (9:00 p.m. Beijing Time on the same day) to discuss financial results and answer questions from investors and analysts. Listeners may access the call by dialing:
| United States: | +1-833-239-5565 |
| International: | +65-6713-5590 |
| Hong Kong: | +852-3018-6771 |
| Mainland China: | 400-820-5286 |
| Conference ID: | 4695856 |
Participants should dial in at least 15 minutes before the scheduled start time and provide the Conference ID to the Operator to be connected to the conference. Due to conditions surrounding the outbreak of COVID-19, participants may experience longer than normal hold period before being assisted to join the call. The Company thanks everyone in advance for their patience and understanding.
A telephone replay will be available approximately two hours after the call until November 24, 2021 07:59 AM U.S. ET by dialing:
| United States: | +1-646-254-3697 |
| International: Hong Kong: Mainland China: | +61-2-8199-0299 +852-3051-2780 400-632-2162 |
| Replay Access Code: | 4695856 |
A live and archived webcast of the conference call will be available on the Company's investor relations website at investors.gds-services.com.
Non-GAAP Disclosure
Our management and board of directors use adjusted EBITDA, adjusted EBITDA margin, adjusted GP and adjusted GP margin, which are non-GAAP financial measures, to evaluate our operating performance, establish budgets and develop operational goals for managing our business. We believe that the exclusion of the income and expenses eliminated in calculating adjusted EBITDA and adjusted GP can provide useful and supplemental measures of our core operating performance. In particular, we believe that the use of adjusted EBITDA as a supplemental performance measure captures the trend in our operating performance by excluding from our operating results the impact of our capital structure (primarily interest expense), asset base charges (primarily depreciation and amortization, operating lease cost relating to prepaid land use rights and accretion expenses for asset retirement costs), other non-cash expenses (primarily share-based compensation expenses), and other income and expenses which we believe are not reflective of our operating performance, whereas the use of adjusted gross profit as a supplemental performance measure captures the trend in gross profit performance of our data centers in service by excluding from our gross profit the impact of asset base charges (primarily depreciation and amortization, operating lease cost relating to prepaid land use rights and accretion expenses for asset retirement costs) and other non-cash expenses (primarily share-based compensation expenses) included in cost of revenue.
We note that depreciation and amortization is a fixed cost which commences as soon as each data center enters service. However, it usually takes several years for new data centers to reach high levels of utilization and profitability. The Company incurs significant depreciation and amortization costs for its early stage data center assets. Accordingly, gross profit, which is a measure of profitability after taking into account depreciation and amortization, does not accurately reflect the Company’s 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 gross profit, 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 GP, and adjusted GP margin are not substitutes for gross profit, 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, operating lease cost relating to prepaid land use rights, accretion expenses for asset retirement costs, share-based compensation expenses and gain from purchase price adjustment, 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 RMB 6.4434 to US
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 GDS Holdings Limited
GDS Holdings Limited (NASDAQ: GDS; HKEX: 9698) is a leading developer and operator of high-performance data centers in China. The Company’s facilities are strategically located in China’s primary economic hubs where demand for high-performance data center services is concentrated. The Company also builds, operates and transfers data centers at other locations selected by its customers in order to fulfill their broader requirements. The Company’s data centers have large net floor area, high power capacity, density and efficiency, and multiple redundancies across all critical systems. GDS is carrier and cloud-neutral, which enables its customers to access all the major PRC telecommunications networks, as well as the largest PRC and global public clouds which are hosted in many of its facilities. The Company offers co-location and managed services, including direct private connection to leading public clouds, an innovative service platform for managing hybrid clouds and, where required, the resale of public cloud services. The Company has a 20-year track record of service delivery, successfully fulfilling the requirements of some of the largest and most demanding customers for outsourced data center services in China. The Company’s customer base consists predominantly of hyperscale cloud service providers, large internet companies, financial institutions, telecommunications carriers, IT service providers, and large domestic private sector and multinational corporations.
Safe Harbor Statement
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. GDS Holdings may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the “SEC”) on Forms 20-F and 6-K, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause GDS Holdings’ actual results or financial performance to differ materially from those contained in any forward-looking statement, including but not limited to the following: GDS Holdings’ goals and strategies; GDS Holdings’ future business development, financial condition and results of operations; the expected growth of the market for high-performance data centers, data center solutions and related services in China; GDS Holdings’ expectations regarding demand for and market acceptance of its high-performance data centers, data center solutions and related services; GDS Holdings’ expectations regarding building, strengthening and maintaining its relationships with new and existing customers; the continued adoption of cloud computing and cloud service providers in China; risks and uncertainties associated with increased investments in GDS Holdings’ business and new data center initiatives; risks and uncertainties associated with strategic acquisitions and investments; GDS Holdings’ ability to maintain or grow its revenue or business; fluctuations in GDS Holdings’ operating results; changes in laws, regulations and regulatory environment that affect GDS Holdings’ business operations; competition in GDS Holdings’ industry in China; security breaches; power outages; and fluctuations in general economic and business conditions in China and globally, the impact of the COVID-19 outbreak, and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks, uncertainties or factors is included in the GDS Holdings’ filings with the SEC, including its annual report on form 20-F. All information provided in this press release is as of the date of this press release and are based on assumptions that GDS Holdings believes to be reasonable as of such date, and GDS Holdings does not undertake any obligation to update any forward-looking statement, except as required under applicable law.
For investor and media inquiries, please contact:
GDS Holdings Limited
Laura Chen
Phone: +86 (21) 5176-5509
Email: ir@gds-services.com
The Piacente Group, Inc.
Ross Warner
Phone: +86 (10) 6508-0677
Email: GDS@tpg-ir.com
Brandi Piacente
Phone: +1 (212) 481-2050
Email: GDS@tpg-ir.com
GDS Holdings Limited
| GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) | |||||||
| As of December 31, 2020 | As of September 30, 2021 | ||||||
| RMB | RMB | US$ | |||||
| Assets | |||||||
| Current assets | |||||||
| Cash | 16,259,457 | 10,103,624 | 1,568,058 | ||||
| Accounts receivable, net of allowance for doubtful accounts | 1,480,335 | 1,860,238 | 288,704 | ||||
| Value-added-tax (“VAT”) recoverable | 155,620 | 193,402 | 30,016 | ||||
| Prepaid expenses and other current assets | 423,394 | 514,180 | 79,799 | ||||
| Total current assets | 18,318,806 | 12,671,444 | 1,966,577 | ||||
| Property and equipment, net | 29,596,061 | 37,723,106 | 5,854,534 | ||||
| Prepaid land use rights, net | 678,190 | 652,803 | 101,313 | ||||
| Operating lease right-of-use assets | 3,059,700 | 3,457,530 | 536,600 | ||||
| Goodwill and intangible assets, net | 3,381,715 | 6,822,591 | 1,058,850 | ||||
| Other non-current assets | 2,224,323 | 3,105,509 | 481,967 | ||||
| Total assets | 57,258,795 | 64,432,983 | 9,999,841 | ||||
| Liabilities, Mezzanine Equity and Equity | |||||||
| Current liabilities | |||||||
| Short-term borrowings and current portion of long-term borrowings | 2,153,390 | 2,556,625 | 396,782 | ||||
| Accounts payable | 3,657,112 | 3,855,639 | 598,386 | ||||
| Accrued expenses and other payables | 1,492,649 | 1,985,873 | 308,202 | ||||
| Operating lease liabilities, current | 86,258 | 120,228 | 18,659 | ||||
| Finance lease and other financing obligations, current | 254,412 | 404,835 | 62,829 | ||||
| Total current liabilities | 7,643,821 | 8,923,200 | 1,384,858 | ||||
| Long-term borrowings, excluding current portion | 10,566,746 | 16,422,303 | 2,548,701 | ||||
| Convertible bonds payable | 1,928,466 | 1,925,508 | 298,834 | ||||
| Operating lease liabilities, non-current | 1,542,895 | 1,742,683 | 270,460 | ||||
| Finance lease and other financing obligations, non-current | 8,097,881 | 8,451,122 | 1,311,594 | ||||
| Other long-term liabilities | 811,264 | 824,508 | 127,962 | ||||
| Total liabilities | 30,591,073 | 38,289,324 | 5,942,409 | ||||
| Mezzanine equity | |||||||
| Redeemable preferred shares | 980,910 | 974,837 | 151,292 | ||||
| Redeemable non-controlling interests | 120,820 | 336,223 | 52,181 | ||||
| Total mezzanine equity | 1,101,730 | 1,311,060 | 203,473 | ||||
| GDS Holdings Limited shareholders' equity | |||||||
| Ordinary shares | 507 | 507 | 79 | ||||
| Additional paid-in capital | 28,728,717 | 28,922,222 | 4,488,658 | ||||
| Accumulated other comprehensive loss | (439,635 | ) | (528,533 | ) | (82,027 | ) | |
| Accumulated deficit | (2,723,597 | ) | (3,594,927 | ) | (557,924 | ) | |
| Total GDS Holdings Limited shareholders' equity | 25,565,992 | 24,799,269 | 3,848,786 | ||||
| Non-controlling interests | 0 | 33,330 | 5,173 | ||||
| Total equity | 25,565,992 | 24,832,599 | 3,853,959 | ||||
| Total liabilities, mezzanine equity and equity | 57,258,795 | 64,432,983 | 9,999,841 | ||||
| GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Amount in thousands of Renminbi ("RMB") and US dollars ("US$") except for number of shares and per share data) | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2020 | June 30, 2021 | September 30, 2021 | September 30, 2020 | September 30, 2021 | ||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Net revenue | ||||||||||||||||
| Service revenue | 1,522,353 | 1,862,951 | 2,061,104 | 319,878 | 4,089,417 | 5,628,547 | 873,537 | |||||||||
| Equipment sales | 2,396 | 968 | 314 | 49 | 17,955 | 2,757 | 428 | |||||||||
| Total net revenue | 1,524,749 | 1,863,919 | 2,061,418 | 319,927 | 4,107,372 | 5,631,304 | 873,965 | |||||||||
| Cost of revenue | (1,115,784 | ) | (1,424,050 | ) | (1,605,983 | ) | (249,245 | ) | (2,986,967 | ) | (4,339,148 | ) | (673,425 | ) | ||
| Gross profit | 408,965 | 439,869 | 455,435 | 70,682 | 1,120,405 | 1,292,156 | 200,540 | |||||||||
| Operating expenses | ||||||||||||||||
| Selling and marketing expenses | (35,157 | ) | (36,447 | ) | (34,371 | ) | (5,334 | ) | (95,217 | ) | (106,513 | ) | (16,531 | ) | ||
| General and administrative expenses | (203,460 | ) | (247,903 | ) | (262,204 | ) | (40,693 | ) | (477,182 | ) | (741,206 | ) | (115,033 | ) | ||
| Research and development expenses | (11,020 | ) | (8,605 | ) | (9,023 | ) | (1,400 | ) | (30,007 | ) | (26,921 | ) | (4,178 | ) | ||
| Income from operations | 159,328 | 146,914 | 149,837 | 23,255 | 517,999 | 417,516 | 64,798 | |||||||||
| Other income (expenses): | ||||||||||||||||
| Net interest expenses | (339,245 | ) | (411,722 | ) | (392,072 | ) | (60,849 | ) | (900,759 | ) | (1,161,464 | ) | (180,256 | ) | ||
| Foreign currency exchange (loss) gain, net | (134 | ) | (981 | ) | (3,933 | ) | (610 | ) | (17,340 | ) | (3,712 | ) | (576 | ) | ||
| Gain from purchase price adjustment | 0 | 0 | 0 | 0 | 55,154 | 0 | 0 | |||||||||
| Others, net | 10,481 | 18,477 | 14,672 | 2,277 | 24,385 | 49,458 | 7,676 | |||||||||
| Loss before income taxes | (169,570 | ) | (247,312 | ) | (231,496 | ) | (35,927 | ) | (320,561 | ) | (698,202 | ) | (108,358 | ) | ||
| Income tax expenses | (35,065 | ) | (51,151 | ) | (69,635 | ) | (10,807 | ) | (77,152 | ) | (180,129 | ) | (27,956 | ) | ||
| Net loss | (204,635 | ) | (298,463 | ) | (301,131 | ) | (46,734 | ) | (397,713 | ) | (878,331 | ) | (136,314 | ) | ||
| Net loss attributable to non-controlling interests | 0 | 141 | 351 | 54 | 0 | 492 | 76 | |||||||||
| Net loss attributable to redeemable non-controlling interests | 1,240 | 1,994 | 2,519 | 391 | 1,240 | 6,509 | 1,010 | |||||||||
| Net loss attributable to GDS Holdings Limited shareholders | (203,395 | ) | (296,328 | ) | (298,261 | ) | (46,289 | ) | (396,473 | ) | (871,330 | ) | (135,228 | ) | ||
| Accretion to redemption value of redeemable non-controlling interests | (7,142 | ) | (16,301 | ) | (26,840 | ) | (4,166 | ) | (7,142 | ) | (55,111 | ) | (8,553 | ) | ||
| Net loss available to GDS Holdings Limited shareholders | (210,537 | ) | (312,629 | ) | (325,101 | ) | (50,455 | ) | (403,615 | ) | (926,441 | ) | (143,781 | ) | ||
| Cumulative dividend on redeemable preferred shares | (13,284 | ) | (12,228 | ) | (12,395 | ) | (1,924 | ) | (39,951 | ) | (36,806 | ) | (5,712 | ) | ||
| Net loss available to GDS Holdings Limited ordinary shareholders | (223,821 | ) | (324,857 | ) | (337,496 | ) | (52,379 | ) | (443,566 | ) | (963,247 | ) | (149,493 | ) | ||
| Loss per ordinary share | ||||||||||||||||
| Basic and diluted | (0.18 | ) | (0.22 | ) | (0.23 | ) | (0.04 | ) | (0.37 | ) | (0.66 | ) | (0.10 | ) | ||
| Weighted average number of ordinary share outstanding | ||||||||||||||||
| Basic and diluted | 1,257,370,403 | 1,449,629,053 | 1,456,204,136 | 1,456,204,136 | 1,210,075,809 | 1,450,578,074 | 1,450,578,074 | |||||||||
| GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2020 | June 30, 2021 | September 30, 2021 | September 30, 2020 | September 30, 2021 | ||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Net loss | (204,635 | ) | (298,463 | ) | (301,131 | ) | (46,734 | ) | (397,713 | ) | (878,331 | ) | (136,314 | ) | ||
| Foreign currency translation adjustments, net of nil tax | (58,832 | ) | (129,001 | ) | 13,980 | 2,170 | (53,223 | ) | (88,898 | ) | (13,797 | ) | ||||
| Comprehensive loss | (263,467 | ) | (427,464 | ) | (287,151 | ) | (44,564 | ) | (450,936 | ) | (967,229 | ) | (150,111 | ) | ||
| Comprehensive loss attributable to non-controlling interests | 0 | 141 | 351 | 54 | 0 | 492 | 76 | |||||||||
| Comprehensive loss attributable to redeemable non-controlling interests | 1,240 | 1,994 | 2,519 | 391 | 1,240 | 6,509 | 1,010 | |||||||||
| Comprehensive loss attributable to GDS Holdings Limited shareholders | (262,227 | ) | (425,329 | ) | (284,281 | ) | (44,119 | ) | (449,696 | ) | (960,228 | ) | (149,025 | ) | ||
| GDS HOLDINGS LIMITED UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Amount in thousands of Renminbi ("RMB") and US dollars ("US$")) | |||||||||||||||
| Three months ended | Nine months ended | ||||||||||||||
| September 30, 2020 | June 30, 2021 | September 30, 2021 | September 30, 2020 | September 30, 2021 | |||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | |||||||||
| Net loss | (204,635 | ) | (298,463 | ) | (301,131 | ) | (46,734 | ) | (397,713 | ) | (878,331 | ) | (136,314 | ) | |
| Depreciation and amortization | 450,851 | 619,613 | 697,889 | 108,311 | 1,160,074 | 1,877,722 | 291,418 | ||||||||
| Amortization of debt issuance cost and debt discount | 23,957 | 65,235 | 35,567 | 5,520 | 81,092 | 136,744 | 21,222 | ||||||||
| Share-based compensation expense | 88,607 | 100,498 | 91,760 | 14,241 | 222,449 | 300,369 | 46,617 | ||||||||
| Gain from purchase price adjustment | 0 | 0 | 0 | 0 | (55,154 | ) | 0 | 0 | |||||||
| Others | (8,727 | ) | 25,659 | 15,752 | 2,445 | (61,475 | ) | 28,276 | 4,388 | ||||||
| Changes in operating assets and liabilities | (357,996 | ) | (149,268 | ) | (83,646 | ) | (12,982 | ) | (940,978 | ) | (669,512 | ) | (103,907 | ) | |
| Net cash (used in) provided by operating activities | (7,943 | ) | 363,274 | 456,191 | 70,801 | 8,295 | 795,268 | 123,424 | |||||||
| Purchase of property and equipment and land use rights | (2,140,979 | ) | (1,868,400 | ) | (3,241,924 | ) | (503,139 | ) | (5,688,582 | ) | (7,385,229 | ) | (1,146,170 | ) | |
| Payments related to acquisitions and investments | (606,963 | ) | (2,968,828 | ) | (595,899 | ) | (92,482 | ) | (944,196 | ) | (3,597,533 | ) | (558,328 | ) | |
| Receipts from collection of loans | 0 | 0 | 20,866 | 3,238 | 0 | 20,866 | 3,238 | ||||||||
| Net cash used in investing activities | (2,747,942 | ) | (4,837,228 | ) | (3,816,957 | ) | (592,383 | ) | (6,632,778 | ) | (10,961,896 | ) | (1,701,260 | ) | |
| Net proceeds from financing activities | 1,154,008 | 1,947,569 | 1,114,694 | 172,998 | 7,026,400 | 4,000,697 | 620,898 | ||||||||
| Net cash provided by financing activities | 1,154,008 | 1,947,569 | 1,114,694 | 172,998 | 7,026,400 | 4,000,697 | 620,898 | ||||||||
| Effect of exchange rate changes on cash and restricted cash | (151,479 | ) | (173,008 | ) | 22,607 | 3,508 | (101,992 | ) | (104,332 | ) | (16,191 | ) | |||
| Net (decrease) increase of cash and restricted cash | (1,753,356 | ) | (2,699,393 | ) | (2,223,465 | ) | (345,076 | ) | 299,925 | (6,270,263 | ) | (973,129 | ) | ||
| Cash and restricted cash at beginning of period | 8,026,543 | 15,145,524 | 12,446,131 | 1,931,609 | 5,973,262 | 16,492,929 | 2,559,662 | ||||||||
| Cash and restricted cash at end of period | 6,273,187 | 12,446,131 | 10,222,666 | 1,586,533 | 6,273,187 | 10,222,666 | 1,586,533 | ||||||||
| GDS HOLDINGS LIMITED RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS (Amount in thousands of Renminbi ("RMB") and US dollars ("US$") except for percentage data) | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2020 | June 30, 2021 | September 30, 2021 | September 30, 2020 | September 30, 2021 | ||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Gross profit | 408,965 | 439,869 | 455,435 | 70,682 | 1,120,405 | 1,292,156 | 200,540 | |||||||||
| Depreciation and amortization | 378,291 | 536,240 | 599,223 | 92,999 | 1,016,510 | 1,632,402 | 253,345 | |||||||||
| Operating lease cost relating to prepaid land use rights | 0 | 1,271 | 1,481 | 230 | 0 | 4,011 | 622 | |||||||||
| Accretion expenses for asset retirement costs | 1,070 | 1,432 | 1,478 | 229 | 2,910 | 4,744 | 736 | |||||||||
| Share-based compensation expenses | 23,951 | 28,039 | 25,492 | 3,956 | 58,390 | 84,678 | 13,142 | |||||||||
| Adjusted GP | 812,277 | 1,006,851 | 1,083,109 | 168,096 | 2,198,215 | 3,017,991 | 468,385 | |||||||||
| Adjusted GP margin | ||||||||||||||||
| GDS HOLDINGS LIMITED RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS (Amount in thousands of Renminbi ("RMB") and US dollars ("US$") except for percentage data) | ||||||||||||||||
| Three months ended | Nine months ended | |||||||||||||||
| September 30, 2020 | June 30, 2021 | September 30, 2021 | September 30, 2020 | September 30, 2021 | ||||||||||||
| RMB | RMB | RMB | US$ | RMB | RMB | US$ | ||||||||||
| Net loss | (204,635 | ) | (298,463 | ) | (301,131 | ) | (46,734 | ) | (397,713 | ) | (878,331 | ) | (136,314 | ) | ||
| Net interest expenses | 339,245 | 411,722 | 392,072 | 60,849 | 900,759 | 1,161,464 | 180,256 | |||||||||
| Income tax expenses | 35,065 | 51,151 | 69,635 | 10,807 | 77,152 | 180,129 | 27,956 | |||||||||
| Depreciation and amortization | 450,851 | 619,613 | 697,889 | 108,311 | 1,160,074 | 1,877,722 | 291,418 | |||||||||
| Operating lease cost relating to prepaid land use rights | 6,914 | 9,909 | 10,454 | 1,623 | 12,131 | 29,869 | 4,635 | |||||||||
| Accretion expenses for asset retirement costs | 1,070 | 1,432 | 1,478 | 229 | 2,910 | 4,744 | 736 | |||||||||
| Share-based compensation expenses | 88,607 | 100,498 | 91,760 | 14,241 | 222,449 | 300,369 | 46,617 | |||||||||
| Gain from purchase price adjustment | 0 | 0 | 0 | 0 | (55,154 | ) | 0 | 0 | ||||||||
| Adjusted EBITDA | 717,117 | 895,862 | 962,157 | 149,326 | 1,922,608 | 2,675,966 | 415,304 | |||||||||
| Adjusted EBITDA margin | ||||||||||||||||
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1 From the third quarter of 2021, the Company has revised its historical operating metrics to include all the Build-Operate-Transfer (“B-O-T”) joint venture data centers which were not included in the previous reporting periods, as the Company finalized and signed a new master joint venture investment agreement with GIC, with the Company owning
2 During the third quarter of 2020, the Company has changed the description of “Adjusted Net Operating Income” and “Adjusted Net Operating Income Margin”, to “Adjusted Gross Profit” and “Adjusted Gross Profit Margin”, respectively. The change in description and presentation of non-GAAP reconciliation does not change the outcome of the operating metrics or financial results.
FAQ
What were GDS Holdings' financial results for Q3 2021?
How much did adjusted EBITDA grow for GDS in Q3 2021?
What was the commitment rate for area in service for GDS as of September 30, 2021?
How did GDS perform in terms of service revenue in Q3 2021?
What is the total area committed by GDS as of Q3 2021?
