4Q23 adjusted EBITDA grew 9%, above expectations; FY24 adjusted EBITDA to grow by 2-5%
- Revenue increased 11% y-o-y to US$1.4bn in 4Q23, while rental rate increased by 8% on a cash basis
- Adjusted EBITDA increased 9% y-o-y to US$686m, above expectations due to lower-than-expected OPEX
- Management expects FY24 adjusted EBITDA to grow by 2-5% y-o-y, in line
4Q23 adjusted EBITDA increased 9% y-o-y, above expectations. Revenue increased 11% y-o-y to US$1.4bn in 4Q23, in line with market expectations, while rental rate increased by 8% on a cash basis, hitting the highest level since 2015. Total operating expenses (OPEX) increased by 11% y-o-y to US$1.2bn. Adjusted EBITDA increased by 9% y-o-y to US$686m, above consensus estimates due to lower-than-expected OPEX. Core FFO per share decreased slightly by 1% y-o-y to US$1.63 in 4Q23. The company continued to demonstrate its ability to acquire new customers, adding 134 new customers in the quarter, totalling 506 new logo acquisitions in FY23.
Management expects FY24 adjusted EBITDA to grow 2-5%. The company introduced its FY24 guidance and expects adjusted EBITDA to grow by 2-5% y-o-y to US$2,800-2,900m, in line. The company anticipates its core FFO per share to grow slightly by c.1% y-o-y to US$6.60-$6.75, translating into a c.4% dividend yield. Management also expects the pricing environment to further improve, as they expect rental renewal rate to increase between 4-6% in FY24. The company mentioned that its net debt / adjusted EBITDA ratio would be 5.8x – factoring in the completion of Blackstone development join ventures and asset sales – compared to 6.9x in 4Q22.