INXN InterXion Holding NV

Interxion Holding NV (NYSE: INXN), a leading European provider of carrier-neutral colocation data centre services, announced its results today for the three and nine months ended 30 September 2011.

Highlights

• Revenue increased by 13% to €62.0 million (Q3 2010: €54.6 million)
• Recurring Revenue increased by 17% to €58.2 million (Q3 2010: €49.6 million) and 4% over Q2 2011 (€56.2 million)
• Adjusted EBITDA increased by 20% to €25.0 million (Q3 2010: €20.8 million)
• Adjusted EBITDA margin increased to 40.3% (Q3 2010: 38.1%)
• Net profit increased to €6.9 million (Q3 2010: €5.9 million)
• Capital Expenditures were €53.8 million in the third quarter
• Reaffirmed full year 2011 guidance

“Interxion showed growth in all key performance metrics during the third quarter. As a result of customer demand, we announced the construction of our seventh data centre in Paris during the third quarter, and since the end of the third quarter we have announced the construction of three major new data centres, Frankfurt 7, London 2, and today, Amsterdam 6,” said Chief Executive Officer David Ruberg. “Despite the economic uncertainty across Europe, we continue to see strong demand trends in our targeted segments, especially cloud computing, digital media, and financial services.”

Quarterly Review

Revenue for the third quarter of 2011 was €62.0 million, a 13% increase over the third quarter of 2010 and a 3% increase from the second quarter of 2011. Recurring revenue was €58.2 million, a 17% increase over the third quarter of 2010 and a 4% increase from the second quarter of 2011. Recurring revenue was 94% of total revenue.

Cost of sales for the third quarter increased by 8% to €26.0 million compared to the third quarter 2010, producing an increased gross profit margin of 58.1% compared to 56.2% in the same quarter of 2010. Sales and marketing costs in the third quarter were €4.2 million, down 3% compared to the prior year quarter. General and administrative costs, excluding depreciation, amortisation, impairments, exceptional general and administrative costs, and share-based payments were €6.8 million, an increase of 24% compared to the prior year quarter and were impacted by public company costs. Depreciation, amortisation, and impairments increased by 16% compared to the prior year quarter to €9.1 million.

Net financing costs for the third quarter of 2011 were €5.3 million, compared to €5.1 million in the third quarter of 2010.

Net profit was €6.9 million in the third quarter of 2011, up 16% from the third quarter of 2010.

Adjusted EBITDA for the third quarter of 2011 was €25.0 million, up 20% year over year. Adjusted EBITDA margin expanded to 40.3% compared to 38.1% in the prior year quarter as the company’s increased scale provided greater operating leverage.

Cash generated from operations, defined as cash generated from operating activities before interest and corporate income tax payments and receipts, was €23.8 million. Net cash used in investing activities was €4.9 million, reflecting €53.8 million of capital expenditures largely offset by €50.0 million liquidated from short term investments.

Cash and equivalents and short term investments were €189.5 million at 30 September 2011, up from €99.1 million at year end 2010.

Equipped space at the end of the third quarter 2011 was 62,200 square metres compared to 61,500 square metres in the second quarter 2011 and 59,600 square metres in the third quarter 2010. Utilisation rate, the ratio of revenue-generating space to equipped space, was 74%, the same as the second quarter 2011 and up from 71% in the third quarter 2010.

Business Outlook

The company today also reaffirmed its guidance for 2011:

Revenue       €239 million - €245 million Adjusted EBITDA €91 million - €95 million Capital Expenditures €140 million - €160 million

Conference Call to Discuss Results

The company will host a conference call at 8:30 a.m. ET (1:30 p.m. GMT) today to discuss results for the third quarter 2011.

To participate on this call, U.S. callers may dial toll free 1-866-966-9439; callers outside the U.S. may dial direct +44 (0) 1452 555 566. The conference ID for this call is 19681993. This event also will be webcast live over the Internet in listen-only mode at investors.interxion.com.

A replay of this call will be available shortly after the call concludes and will be available until 21 November 2011. To access the replay, U.S. callers may dial toll free 1-866-247-4222; callers outside the U.S. may dial direct +44 (0) 1452 55 00 00. The replay access number is 19681993#.

Forward Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from expectations discussed in such forward-looking statements. Factors that might cause such differences include, but are not limited to, the difficulty of reducing operating expenses in the short term, inability to utilise the capacity of newly planned data centres and data centre expansions, significant competition, the cost and supply of electrical power, data centre industry over-capacity, performance under service level agreements and other risks described from time to time in Interxion's filings with the Securities and Exchange Commission. Interxion does not assume any obligation to update the forward-looking information contained in this press release.

Adjusted EBITDA

EBITDA is defined as operating profit plus depreciation, amortisation and impairment of assets. We define Adjusted EBITDA as EBITDA adjusted to exclude share-based payments and exceptional and non-recurring items, and to include share of profits (losses) of non-group companies. We present Adjusted EBITDA as additional information because we understand that they are measures used by certain investors and because it is used in our financial covenants in our €50 million revolving credit facility and €260 million 9.50% Senior Secured Notes due 2017. However, other companies may present Adjusted EBITDA differently than we do. Adjusted EBITDA is not a measure of financial performance under IFRS and should not be considered as an alternative to operating profit or as a measure of liquidity or an alternative to net income as indicators of our operating performance or any other measure of performance derived in accordance with IFRS.

A reconciliation of Adjusted EBITDA to EBITDA and operating profit is provided in the Notes to Consolidated Income Statement: Group Metrics.

About Interxion

Interxion is a leading provider of carrier-neutral colocation data centre services in Europe, serving over 1,200 customers through 28 data centres in 11 European countries. Interxion’s uniformly designed, energy-efficient data centres offer customers extensive security and uptime for their mission-critical applications. With connectivity provided by 400 carriers and ISPs and 18 European Internet exchanges across its footprint, Interxion has created content and connectivity hubs that foster growing customer communities of interest. For more information please visit www.interxion.com.

        INTERXION HOLDING NV CONSOLIDATED INCOME STATEMENTS (in €'000 - except per share data and where stated otherwise) (unaudited)     Three Months Ended Nine Months Ended 30-Sep 30-Sep 30-Sep 30-Sep 2011 2010 2011 2010   Revenue 62,005 54,646 179,920 152,824 Cost of sales (25,969 ) (23,945 ) (76,271 ) (67,867 ) Gross profit 36,036 30,701 103,649 84,957 Other income 99 67 341 293 Sales and marketing costs (4,234 ) (4,380 ) (13,037 ) (11,262 ) General and administrative costs (16,594 ) (13,781 ) (50,389 ) (39,717 ) Operating profit 15,307 12,607 40,564 34,271 Finance income 1,114 101 2,324 366 Finance expense (6,369 ) (5,167 ) (20,153 ) (23,687 ) Profit before taxation 10,052 7,541 22,735 10,950 Income tax expense (3,161 ) (1,606 ) (7,812 ) (5,782 ) Net profit 6,891   5,935   14,923   5,168     Basic earnings per share: (€) (i) 0.10 0.13 0.23 0.12 Diluted earnings per share: (€) (i) 0.10 0.12 0.23 0.11       Number of shares outstanding at the end of the period (shares in thousands) 65,823 44,351 65,823 44,351 Weighted average number of shares for Basic EPS (shares in thousands) 65,742 44,351 63,528 44,351 Weighted average number of shares for Diluted EPS (shares in thousands) 67,488 47,676 65,223 47,574     (i) Number of shares have been adjusted to take account of the 1 for 5 reverse stock split which took place on 2 February 2011.           INTERXION HOLDING NV NOTES TO CONSOLIDATED INCOME STATEMENT: SEGMENT INFORMATION (in €'000 - except where stated otherwise) (unaudited)     Three Months Ended Nine Months Ended 30-Sep 30-Sep 30-Sep 30-Sep 2011 2010 2011 2010 Consolidated   Recurring revenue 58,225 49,633 168,611 141,551 Non-recurring Revenue 3,780   5,013   11,309   11,273   Revenue 62,005   54,646   179,920   152,824   Adjusted EBITDA 25,005   20,818   70,536   57,823   Gross Margin 58.1 % 56.2 % 57.6 % 55.6 % Adjusted EBITDA Margin 40.3 % 38.1 % 39.2 % 37.8 %   Total assets 708,410 464,663 708,410 464,663 Total liabilities 392,391 321,365 392,391 321,365 Capital expenditures (iv) (53,763 ) (25,516 ) (89,127 ) (79,113 ) Depreciation, amortization and impairments (9,087 ) (7,802 ) (27,181 ) (22,483 )   France, Germany, Netherlands, and UK   Recurring revenue 34,470 29,429 100,276 84,188 Non-recurring Revenue 1,950   3,371   6,912   7,592   Revenue 36,420   32,800   107,188   91,780   Adjusted EBITDA 18,473   14,725   53,216   42,126   Gross Margin 59.9 % 56.0 % 59.0 % 56.1 % Adjusted EBITDA Margin 50.7 % 44.9 % 49.6 % 45.9 %   Total assets 335,727 267,259 335,727 267,259 Total liabilities 86,705 83,750 86,705 83,750 Capital expenditures (iv) (39,828 ) (14,027 ) (59,258 ) (46,110 ) Depreciation, amortization and impairments (5,118 ) (4,676 ) (16,017 ) (13,657 )   Rest of Europe   Recurring revenue 23,755 20,204 68,335 57,363 Non-recurring Revenue 1,830   1,642   4,397   3,681   Revenue 25,585   21,846   72,732   61,044   Adjusted EBITDA 13,162   11,517   37,423   30,893   Gross Margin 60.7 % 62.2 % 60.9 % 60.4 % Adjusted EBITDA Margin 51.4 % 52.7 % 51.5 % 50.6 %   Total assets 174,732 147,435 174,732 147,435 Total liabilities 38,812 35,718 38,812 35,718 Capital expenditures (iv) (13,650 ) (8,378 ) (28,342 ) (29,065 ) Depreciation, amortization and impairments (3,411 ) (2,843 ) (9,698 ) (7,831 )   Corporate and Other                 Adjusted EBITDA (6,630 ) (5,424 ) (20,103 ) (15,196 )   Total assets 197,951 49,969 197,951 49,969 Total liabilities 266,874 201,897 266,874 201,897 Capital expenditures (iv) (285 ) (3,111 ) (1,527 ) (3,938 ) Depreciation, amortization and impairments (558 ) (283 ) (1,466 ) (995 )    

(iv) Capital expenditures represent payments to acquire tangible fixed assets as recorded in the consolidated statement of cash flows as "Purchase of property, plant and equipment."

          INTERXION HOLDING NV NOTES TO CONSOLIDATED INCOME STATEMENT: GROUP METRICS (in €'000 - except where stated otherwise) (unaudited)     Three Months Ended Nine Months Ended 30-Sep 30-Sep 30-Sep 30-Sep 2011 2010 2011 2010   1. Reconciliation of adjusted EBITDA   Adjusted EBITDA 25,005   20,818   70,536   57,823   Income from subleases on unused data center sites 99   67   341   293   Exceptional income 99   67   341   293     (Increase)/decrease in provision for onerous lease contracts - (67 ) (18 ) (293 ) IPO transaction costs (v) - - (1,725 ) - Share-based payments (710 ) (409 ) (1,389 ) (1,069 ) Exceptional general and administrative costs (710 ) (476 ) (3,132 ) (1,362 ) EBITDA 24,394   20,409   67,745   56,754   Depreciation, amortization and impairments (9,087 ) (7,802 ) (27,181 ) (22,483 ) Operating profit 15,307   12,607   40,564   34,271     2. Capacity Metrics Equipped space (in sqm) 62,200 59,600 62,200 59,600 Revenue generating space (in sqm) 46,100 42,400 46,100 42,400 Utilisation rate 74 % 71 % 74 % 71 %     (v) The IPO transaction costs represent the write off of the proportion of the IPO costs allocated to the selling shareholders at the Initial Public Offering.       INTERXION HOLDING NV CONSOLIDATED BALANCE SHEET (in €'000 - except where stated otherwise) (unaudited)     As at 30-Sep 31-Dec 2011 2010 Non-current assets Property, plant and equipment 402,606 342,420 Intangible assets 9,699 6,005 Deferred tax assets 39,378 39,841 Other non-current assets 3,654   3,709   455,337 391,975 Current assets Trade and other current assets 63,534 55,672 Short-term investments 40,000 - Cash and cash equivalents 149,539   99,115   253,073   154,787   Total assets 708,410   546,762     Shareholders’ equity Share capital 6,582 4,434 Share premium 464,398 321,078 Foreign currency translation reserve 5,292 4,933 Accumulated deficit (160,253 ) (175,176 ) 316,019 155,269 Non-current liabilities Trade payables and other liabilities 9,455 7,795 Deferred tax liabilities 1,596 660 Provision for onerous lease contracts 11,984 13,260 Borrowings 257,301   257,403   280,336 279,118 Current liabilities Trade payables and other liabilities 106,365 106,038 Current tax liabilities 1,831 868 Provision for onerous lease contracts 3,149 3,073 Borrowings 710   2,396   112,055   112,375   Total liabilities 392,391   391,493   Total liabilities and shareholders’ equity 708,410   546,762           INTERXION HOLDING NV NOTES TO THE CONSOLIDATED BALANCE SHEET: BORROWINGS (in €'000 - except where stated otherwise) (unaudited)   As at 30-Sep 31-Dec 2011 2010     3. Borrowings net of cash and cash equivalents and short-term investments   Cash and cash equivalents (vi) and Short-term investments (vii) 189,539   99,115     9.5% Senior Secured Notes due 2017 (viii) 255,402 254,924 Financial Leases 437 765 Other Borrowings 2,172   4,110   Borrowings excluding revolving credit facility deferred financing costs 258,011   259,799   Revolving credit facility deferred financing costs (ix) (821 ) (1,283 ) Total Borrowings 257,190   258,516           Borrowings net of cash and cash equivalents and short-term investments 67,651   159,401      

(vi) Cash and cash equivalents includes €3.5 million as of September 30, 2011 and €4.2 million as of December 31, 2010, which is restricted and held as collateral to support the issuance of bank guarantees on behalf of a number of subsidiary companies.

(vii) Short-term investments relate to six and nine months deposits.

(viii) €260 million 9.5% Senior Secured Notes due 2017 include premium on additional issue and are shown after deducting underwriting discounts and commissions, offering fees and expenses.

(ix) We reported deferred financing costs of €0.8 million in connection with entering into our €50 million revolving credit facility which is currently undrawn.

          INTERXION HOLDING NV CONSOLIDATED STATEMENT OF CASH FLOWS (in €'000 - except where stated otherwise) (unaudited)     Three Months Ended Nine Months Ended 30-Sep 30-Sep 30-Sep 30-Sep 2011 2010 2011 2010     Profit for the period 6,891 5,935 14,923 5,168 Depreciation, amortization and impairments 9,087 7,802 27,181 22,483 IPO transaction costs - - 1,725 - Provision for onerous lease contracts (750 ) (288 ) (2,303 ) (1,828 ) Share-based payments 710 409 1,389 1,069 Net finance expense 5,255 4,777 17,829 23,032 Income tax expense 3,161   1,606   7,812   5,782   24,354 20,241 68,556 55,706 Movements in trade and other current assets (2,316 ) (4,264 ) (7,995 ) (1,618 ) Movements in trade and other liabilities 1,723   3,388   6,913   4,211   Cash generated from operations 23,761 19,365 67,474 58,299 Interest paid (11,598 ) (8,200 ) (24,178 ) (9,178 ) Interest received 704 150 1,241 337 Income tax paid (392 ) (724 ) (1,544 ) (950 ) Net cash flows from operating activities 12,475 10,591 42,993 48,508 Cash flow from investing activities Purchase of property, plant and equipment (53,763 ) (25,516 ) (89,127 ) (79,113 ) Disposals of property, plant and equipment - - 945 - Purchase of intangible assets (1,180 ) (1,059 ) (4,286 ) (1,549 ) Proceeds /(acquisition) short-term investments 50,000   -   (40,000 ) -   Net cash flows from investing activities (4,943 ) (26,575 ) (132,468 ) (80,662 ) Cash flow from financing activities Proceeds from exercised options 698 - 3,022 - Proceeds from issuance new shares - - 142,952 - Repayment of 'Liquidation Price' to former preferred shareholders - - (3,055 ) - Proceeds/(repayment) bank facilities - - - (159,046 ) Proceeds from Senior Secured Notes and RCF - (414 ) (645 ) 190,830 Other Borrowings (678 ) (6 ) (2,265 ) (1,176 ) Net cash flows from financing activities 20 (420 ) 140,009 30,608 Effect of exchange rate changes on cash 16   (125 ) (110 ) 135   Net movement in cash and cash equivalents 7,568 (16,529 ) 50,424 (1,411 ) Cash and cash equivalents, beginning of period 141,971   47,121   99,115   32,003   Cash and cash equivalents, end of period 149,539   30,592   149,539   30,592       INTERXION HOLDING NV Announced Expansion Projects 2011     Market Project CAPEX (a, b) Equipped Space (a) Target Completion     (€ million) (Sqm)     Düsseldorf DUS 1 : Phase 2 Power Upgrade € 7 500 (c) 2Q 2011 (completed) London LON 1 : Phase 9 Expansion € 7 525 2Q 2011 (completed) Vienna VIE 1 : Phase 3 Expansion € 5 600 (d) 3Q 2011 (completed) Dublin DUB 2 : Phase 3 Expansion

and Power Upgrade

€ 8 640 4Q 2011 Paris PAR 7 : Phase 1 New Build € 70 4,500 2Q 2012 Subtotal Announced through 30 September 2011 € 97 6,765   Frankfurt FRA 7: New Build € 21 1,550 1Q 2012 London LON 2: New Build € 38 1,700 2Q 2012 Amsterdam AMS 6: New Build € 60 4,000 4Q 2012 Subtotal Announced since 30 September 2011 € 119 7,250   (a) CAPEX and Equipped Space are approximate and may change after project completion. (b) CAPEX reflects the total for the listed project and may not be all invested in the current year. (c) Previously included in equipped space (d) Announced as a 2 phase project with 1300 sqm and €12 million capex