Interxion Corporate Overview
June 2011 Disclaimer This document includes forward-looking statements. All statements other than statements of historical fact included in this document regarding our business, financial condition, results of operations and certain of our plans, objectives, assumptions, projections, expectations or beliefs with respect to these items and statements regarding other future events or prospects, are forward-looking statements. These statements include, without limitation, those concerning: our strategy and our ability to achieve it; expectations regarding sales, profitability and growth; plans for the construction of new data centers; our possible or assumed future results of operations; research and development, capital expenditure and investment plans; adequacy of capital; and financing plans. The words “aim,” “may,” “will,” “expect,” “anticipate,” “believe,” “future,” “continue,” “help,” “estimate,” “plan,” “schedule,” “intend,” “should,” “shall” or the negative or other variations thereof as well as other statements regarding matters that are not historical fact, are or may constitute forward-looking statements.
In addition, this document includes forward-looking statements relating to our potential exposure to various types of market risks, such as foreign exchange rate risk, interest rate risks and other risks related to financial assets and liabilities. We have based these forward-looking statements on our management’s current view with respect to future events and financial performance. These views reflect the best judgment of our management but involve a number of risks and uncertainties which could cause actual results to differ materially from those predicted in our forward-looking statements and from past results, performance or achievements. Although we believe that the estimates reflected in the forward-looking statements are reasonable, such estimates may prove to be incorrect. By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from these expressed or implied by these forward-looking statements. These factors include, among other things:
• operating expenses cannot be easily reduced in the short term; • inability to utilize the capacity of newly planned data centers and data center expansions; • significant competition; • cost and supply of electrical power; • data center industry over-capacity; and • performance under service level agreements.
All forward-looking statements included in this document are based on information available to us on the date of this document. The Company undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained throughout this document. Carrier, supplier and integrator neutral Interxion Overview
Leading European Carrier-Neutral Colocation Data Center Services Provider
Amsterdam Stockholm • Founded in 1998 and headquartered near & Hilversum Amsterdam, The Netherlands London Copenhagen • LTM Revenue of €218.5 million1
• 337 employees2 Dublin Dusseldorf
• Over 1,200 customers Brussels Frankfurt • 28 data centers in 13 cities across 11 countries Paris Vienna
• 350+ carriers / ISPs and 20 Internet Exchanges Madrid Zurich
• Our Value Proposition Focuses On:
Connectivity Community Coverage
1 Last Twelve months ended March 31, 2011 2 As of Dec. 31, 2010
4 Consistent Track Record 18 Consecutive Quarters of Growth and Margin Improvement
Revenue by Quarter
€m
YoY Growth 35% 27% 38% 40% 39% 40% 39% 32% 30% 28% 22% 18% 18% 19% 25% 21%
Adj. EBITDA by Quarter
€m
YoY Growth 74% 81% 120% 169% 91% 113% 72% 39% 37% 32% 24% 29% 23% 25% 30% 27%
5 Technology Evolution Increasing Demand for Carrier-Neutral Colocation Data Centers
2010 & Beyond: Cloud Era
90’s – 2000’s: Client Server Era
70’s – 80’s: Mainframe Era
• Expanding addressable market • Response time sensitive
6 Carrier-Neutral Colocation Data Center Value Evolution
Interconnection Cost Reduction Value Creation
Reduce Cloud Services, Latency Virtualization & SaaS Communities Electronic Trading of Interest Wireless Managed Services Applications Reduce IT Costs Response Time Sensitive Apps Traffic Exchange Data Storage
7 Interxion: What We Do
What Interxion Is What Interxion Is Not
Premium carrier-neutral Owner of software, colocation data center servers or network assets services provider Largest Pan European Provider of commoditized footprint wholesale data center City center based space Widest choice of Managed service provider connectivity Value Customer focused: Creation Real-estate company - Segmented - Magnetic Builder of speculative - Response time data center capacity sensitive Disciplined operator 100% organic growth
8 Key Investment Highlights
Strong Industry & Secular Fundamentals
Experienced Management Team Leading Position in with Proven Track Attractive European Record of Data Center Market Execution
Attractive Premium, Diverse, Business Model Network-centric and with Multiple Community-focused Growth Drivers and Customer Base Low Churn
Significant Barriers to Entry
9 Global Industry Fundamentals Strong Trends Drive Stable, Sustained Demand
Internet Video Growth Internet Traffic Growth
IP Traffic (PB per month) (1) IP Traffic (PB per month) (1) 23,543 25,000 70,000 20,000 Business 63,904 Consumer 15,000 60,000 10,000 5,000 2,883 50,000 0 2009 2014E 40,000
Migration to Cloud Services 30,000 ($bn) (2) $175 $149 20,000 $150 14,685 $125 $100 10,000 $75 $59 $50 $25 $0 0 2009 2014E 2009 2014E
Sources: Cisco Visual Networking Index, 2010. Gartner, 2010. (1) Petabyte equals 1015 bytes. (2) Includes Business Process Services, Applications, Application Infrastructure and Systems Infrastructure.
10 European Data Center Landscape
In-House Outsourced Carrier-Neutral In-House Wholesale Network Operated Managed Services Colocation
Focus •Various •RealEstate •NetworkSolutions •ITSolutions • Data Centers
Increasing Value Creation Through Cost / Property Play Connectivity and Community
Key Operators
11 European Carrier-Neutral Colocation Market Demand
European Outsourcing Opportunity European Demand for Carrier-Neutral Colocation
(Breakdown of Average Date Center Capacity by Type) Millions IT €2,500 €2,245 Outsourcer 9% €2,000
Carrier-Neutral €1,500 Colocation €922 In-House 3% €1,000 88% €500 2009 2014E
Key Differentiators Provide Long Term Upside Relative to North America
12 Europe North America Broadband Subscribers 130m 93m Smart Phones 201m 109m
Growth in Internet Traffic 09-14E CAGR 36% 30%
Sources: IDC, Carrier-Neutral Colocation – User Requirements and Demand Forecast Study, 2009, OECD, as of June 2010, World Cellular Information Service and Cisco Visual Networking Index, 2010, Cisco VNI Report, 2010.
12 Leading Carrier-Neutral Colocation Operator in Europe Most Countries, Most Carriers and Largest Data Center Footprint
European Country Presence and GDP Coverage Access to Carriers & Internet Exchanges
75% 69% 56% 28% 20 13 7 11 # of Countries % European GDP Coverage (1) # of Carriers # of Internet Exchanges 15 400 350 11
10 7 300 234 5 200 175 5 2 200
0 100 Interxion Telecity Equinix Telehouse Interxion Telecity Telehouse Equinix Group Europe Group Europe Equipped Space Number of European Data Centers
Equipped Space (‘000 Sqm) (2) # of Data Centers 28 75 64.2 64.0 30 26 61.0 24 52.2 50 20
25 10 7
0 0 Interxion Telecity Equinix Telehouse Interxion Equinix Telecity Telehouse Europe Europe Sources: Company filings, company websites and broker research, Eurostat. (1) Based on 4Q’10 GDP for the 27 European Union member states and Switzerland. (2) As per latest reported numbers – for Equinix assumes 20 Sqft per cabinet. Equinix Europe had 28,100 cabinets as of March 2011.
13 European Supply and Pricing Environment
European Carrier-Neutral Colocation Additional • The European carrier-neutral colocation Supply in Top 4 Markets industry remains supply constrained New Supply (Sqm) (1) % of Equipped Space 50 20% 18% – New space added as a % of total 40 29K Sqm 30K Sqm 29K Sqm equipped space decreasing over time 30 22K Sqm 14% 15% 20 – Demand outpacing supply resulting in 12% 12% 10 upward pricing pressure
0 10% (2) – Consistently high industry utilization 2008 2009 2010 2011 rates European Average Carrier-Neutral Colocation % Utilization (3) 100% 78% 75% 75% • Over the past 3 years Interxion has 80% 73% demonstrated: 60% – Consistent avg monthly churn < 0.6% 40%
20% – Stable data center utilization of 70% - 75%
0% – Increasing recurring revenue per Sqm (4) 2008 2009 2010 2011E
Sources: Company filings, company websites. (1) New data center openings by INXN, TCY, EQIX Europe and Telehouse in Big 4 markets defined as The Netherlands, United Kingdom, France and Germany. (2) Announced supply for 2011. (3) 2011E based on TCY and EQIX guidance. (4) Recurring revenue divided by average revenue generating space in square meters.
14 Segment, Customer & Application Focused
Disciplined Approach to Identifying Target Build Communities of Interest In Segments Target Segments
• High growth • Win magnetic companies • Need robust connectivity • Magnetic companies are a catalyst for • Benefit from communities of interest communities • Value proximity to business partners • Win other community member • Rely on real time applications companies • Have Pan European / global footprint
Customer Base in Target Segments
Digital Media & Managed Services Enterprises Financial Services Network Providers Distribution Providers
10% 11% 13% 18% 36%
(1) (1) Data as per 1Q'11 financials. Remaining 12% of recurring revenue relates to system integrators and other. % of Recurring Revenue
15 Interxion Focuses On Communities of Interest To Drive Customer Value and Stickiness
In Addition to Providing Premium Collocation 1 2 1 Services, Connectivity & Coverage…
Value Creation
3
…We Target Magnetics Because They …We Foster Communities 2 Attract Community Members… 3 of Interest that Add Value to Members…
(Selected) Financial Hub Community - London
Financial
Media Service Vendors Brokerages
Exchanges Cloud
16 Significant Barriers to Entry
Long Lead Time to Network Effect Build Critical from Communities Carrier Mass of Interest
Established Brand High Switching Costs and Track Record No New Pan European Entrant of Size in Last 10 Years
Data Center European Development Requires In-Country Design and Permitting Expertise Expertise
Carriers choose to locate their infrastructure in data centers with a significant number of customers and customers choose data centers with strong carrier connectivity
17 Multiple Drivers to Deliver Revenue & Margin Growth
Multiple Growth Drivers Revenue
(€m) • Favourable industry fundamentals 240 218
180 • Attractive supply / demand dynamics 120 100
• New customer acquisition in targeted 60 segments 0 2007 1Q11 LTM
• Favorable contracts enabling Adj. EBITDA Margin increased revenue per Sqm (%) 40% 38% • Disciplined expansion of equipped
space 29% 30%
20% 2007 1Q11LTM
18 Key Financial Highlights Summary Historical Performance
Attractive Business Model… …Driving Outstanding Results
• Growth • Strong top line growth with 28% CAGR since 2007 • Visibility
• Diversity • Strong Adj. EBITDA margin with +9 p.p. improvement since 2007 • Consistency
• High fixed cost component → operating • High cash flow conversion leverage
• Disciplined execution • Net Income positive since 2006
Predictable business model, strong growth, high revenue visibility and increasing pricing
Sources: Company filings, company website. CAGR based on annual results through 2010.
19 Consistent Quarterly Performance Strong Growth Across the Cycle
Revenue by Quarter
€m 80 57.9 50.4 54.6 55.6 60 42.5 43.7 45.1 47.8 35.7 38.1 40.4 28.8 31.1 33.3 40 22.3 23.8 25.6 20 0 1Q'07 2Q'07 3Q'07 4Q'07 1Q'08 2Q'08 3Q'08 4Q'08 1Q'09 2Q'09 3Q'09 4Q'09 1Q'10 2Q'10 3Q'10 4Q'10 1Q'11
YoY Growth 35% 27% 38% 40% 39% 40% 39% 32% 30% 28% 22% 18% 18% 19% 25% 23% 21% GDP Growth 5% NA YoY (1) 6% 6% 5% 3% 1% 1% 0% (5%) (7%) (6%) (6%) 0% 3% 6% 6%
Adj. EBITDA by Quarter
€m 25 19.6 20.8 21.4 22.2 20 15.7 16.0 16.9 17.4 12.9 13.1 14.1 15 11.9 9.4 10.3 7.5 10 5.4 5.6 5 0 1Q'07 2Q'07 3Q'07 4Q'07 1Q'08 2Q'08 3Q'08 4Q'08 1Q'09 2Q'09 3Q'09 4Q'09 1Q'10 2Q'10 3Q'10 4Q'10 1Q'11
YoY Growth 74% 81% 120% 169% 91% 113% 72% 39% 37% 32% 24% 29% 23% 25% 30% 26% 27%
1816 consecutive quarters of QoQ organic revenue andgrowth Adj. and EBITDA QoQ Adj.growth, EBITDA achieved growth, during achieved the most during severe the most severeeconomic economic downturn downturn in decades in decades
(1) YoY nominal GDP growth per quarter in local currency for the 11 countries where Interxion operates (as per Eurostat as of May 2011).
20 Consistent Contribution Across Footprint
Big 4 vs. ROE Revenue Contribution (1) Big 4 vs. ROE Adj. EBITDA Contribution (1)
Contribution (%) Contribution (%)
40% 39% 40% 40% 39% 42% 42% 42% 41% 41% 41% 42% 42% 44% 45% 41% 41% 42% 43% 44% 43% 42%
60% 61% 60% 60% 61% 58% 58% 58% 59% 59% 59% 58% 58% 56% 55% 59% 59% 58% 57% 56% 57% 58%
3Q'084Q'081Q'092Q'093Q'094Q'091Q'102Q'103Q'104Q'101Q'11 3Q'084Q'081Q'092Q'093Q'094Q'091Q'102Q'103Q'104Q'101Q'11
Big 4 ROE Big 4 ROE
(1) Big 4 represents The Netherlands, United Kingdom, France and Germany. ROE represents Rest of Europe (Austria, Belgium, Denmark, Ireland, Spain, Sweden, Switzerland). Adj. EBITDA Contribution based on costs allocated to the segments and excludes costs allocated to Corporate and Other.
21 Customer Distribution Low Customer Concentration and Low Monthly Churn
Customer Concentration Characteristics of Top 20 Customers
Recurring Revenue by Customer % of Recurring # of # of Data Revenue Countries Centers Top Top Customer 4% 9 10 4% Customer
Top 2–10 19% Top 2–10 Customers 19% ~ 6 ~ 11 Other 67% Customers
10% Top 11–20 10% ~ 4 ~ 7 Top 11–20 Customers Customers
Diversification Within Customer Relationships Monthly Churn
% Monthly Churn (1) 1.0% • Country diversity 0.5% 0.5% • Site diversity 0.5% • Application diversity
0.0% 2009 2010 Note: Customer data as per 3Q'10 financials. (1) Average monthly recurring revenue churn in period.
22 Consistent Growth and Margin Expansion
Superior Visibility, Stability and Diversity Over 90% recurring revenue Geographic, segment and customer diversity Typically 60-70% of new bookings from existing Low churn customers Strong brand name / recognition
Revenue Adj. EBITDA & Margin
(€m) (€m) Recurring Non-Recurring 79 240 80 208 63 172 180 60
138 48
120 100 40 29 93% 94% 60 92% 20 91%
0 0 2007 2008 2009 2010 2007 2008 2009 2010
Adj. EBITDA 29% +9 p.p. expansion 38% Margin
23 Operating Leverage Leads to Profitable Growth
Fixed Cost Model… … Drives Operating Leverage
Operating Expense Breakdown (1) Fixed / Semi-Fixed % of Revenue ’07 – 1Q’11 LTM CAGR
Personnel: +22% Avg: 16% Property: +9%
Other: +28%
Power: +28%
Adj. EBITDA: • All power costs are recovered from customers +39% • Once a data center is established, rental and most staff costs are fixed / semi-fixed… • … leading to increase in incremental profit
Strong revenue growth and operating leverage have produced growing Adj. EBITDA margins
(1) 1Q11 LTM adjusted for exceptional items and share-based payments.
24 Attractive Cash Returns 35% Annual Cash Return on Investment in “Full” Data Centers
35% Annual Cash Return on Original Data Center Investment
(€m) % of Original Data Center Investment
100% 60% 40% 35%
€ 100
€ 60
€ 40 € 35
Original Data Annual Gross Profit Annual Cash Center Recurring (65% Gross Return Investment Revenue Margin)
Notes: “Full” data centers defined as those at 85% or greater utilization. Data center gross fixed asset cost (Gross PP&E) at historic exchange rates.
25 Disciplined, FCF Accretive Expansion Strategy
Maximum Equipped Space
+29% 67.0 63.7 Expansion Strategy 58.2 52.0 • Disciplined approach to expansion
– Sized to existing customer demand 2007 2008 2009 2010
Equipped Space – Based on target IRR +67% 61.0 54.8 • Low execution risk 43.2 36.6 – Uniform design 2007 2008 2009 2010 – Campus-oriented Revenue Generating Space
+61% 43.7 – Phase build and capex deployment 38.4 33.3 27.1
2007 2008 2009 2010 Space in 1000’s sqm 74% 70% 72%77%utilization
26 Strong Balance Sheet & Credit Statistics (€ millions)
at 31 Mar 2011 at 31 Dec 2010 Cash €229.2 €99.1
Shareholders’ Equity 299.5 155.3 Borrowings1 259.2 259.8
31 Mar 2011 Covenant Adjusted EBITDA 3.5x 2.0x Coverage Ratio Senior Leverage Ratio 3.1x 4.0x
1 Borrowings composed 9.5% Sr. Secured Notes due 2017, Finance Lease Liabilities, and Other. Balances at 31 December 2010 were €254.9MM, €0.8MM, and €4.1MM respectively. No borrowings were outstanding on the € 50MM Revolving Credit Facility which bears interest at EURIBOR or LIBOR + 400 b.p. Key Investment Highlights
Strong Industry & Secular Fundamentals
Experienced Management Team Leading Position in with Proven Track Attractive European Record of Data Center Market Execution
Attractive Premium, Diverse, Business Model Network-centric and with Multiple Community-focused Growth Drivers and Customer Base Low Churn
Significant Barriers to Entry
28