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An Insightful Look at ESG Opportunities from the Point of View of a CFO and Treasury Lead


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Rachel Wilson - Getting the attention and approval of a CFO or Treasury Lead for sustainability projects can be challenging for a variety of reasons. Although there are a number of great case studies and tools that can help in this regard, this is still relatively new territory for most businesses and as such it often induces anxiety in those trying to navigate it. This talk will share a case study of an effective partnership between the sustainability team and the finance team of a major corporation. Learn how sustainability and finance can be powerful allies and achieve win-win results when they combine forces.

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An Insightful Look at ESG Opportunities from the Point of View of a CFO and Treasury Lead

  1. 1. An Insightful Look at ESG Opportunities from the Point of View of a CFO and Treasury Lead RACHEL WILSON Iron Mountain @IronMountain
  2. 2. Data Center Renewable Energy
 Rachel Wilson SVP CFO Iron Mountain Data Centers
  3. 3. Leading Global Information Management Brand !2 Note: Statistics as of 12/31/17 unless otherwise stated (1) Other revenues include Fulfillment Services, Information Governance and Digital Solutions, Technology Escrow Services, Consulting, Entertainment Services, Fine Art Storage, Consumer Storage and other ancillary services (2) Annualized Q2 2018 revenue Global Footprint Business Mix 6 CONTINENTS53 COUNTRIES 225,000+
 customers 95%
 Fortune 1000 companies 85MM+
 SF of real estate Records Management
 63% Shredding 10% Data
 12% Other(1) 10% 1,400+ Facilities Revenue: $4.2B(2) Data Center
  4. 4. Provider of Mission-Critical Storage and Services !3 $17 BILLION+ Owned real estate globally 680 MILLION+ Cubic feet of hardcopy 
 records archived DIGITAL SOLUTIONS 627 million images 
 scanned annually SECURE DESTRUCTION ~10% of total global revenue IRON CLOUDTM Data protection, preservation, restoration and recovery 30 MILLION Film and sound elements protected and preserved 98 PERCENT Customer retention rate ~285 MEGAWATTS Existing and potential data center capacity # 1 TRUSTED GUARDIAN OF PRECIOUS ASSETS
  5. 5. Sustainable Business Strategy Sustainable Business Strategy is about using Environment, Social, Governance (ESG) impacts as a driver to inspire new thinking about what we do and how we do it. Our Six ESG Priorities
  6. 6. Our Customers are undergoing a significant digital transformation And so are we…..
  7. 7. Digital data needs a physical place Digital transformation changes our business as we build-out the physical infrastructure to support the demand for 3rd party data center space.
  8. 8. Over $2B in capital investments to grow our global portfolio of secure data centers 12 colocation facilities • Hyperscale-Ready • Strategic Edge • Underground 3 continents • 4 countries • 11 markets • 1100+ customers • 2.5M+ gross square feet
  9. 9. !8 $155 $185 $335 $100 $490 $150 Discretionary Investments(3) Sources(3) (1) Customer inducements and acquisitions of customer relationships are not deducted from AFFO as they represent discretionary growth investment (2) Includes core growth racking and excludes Northern Virginia Data Center development under capital lease (3) Excludes price of IO Data Centers acquisition, which closed on January 10, 2018 and possible future data center acquisitions. (4) Based on guidance as of 7/27/18 Note: Iron Mountain does not provide a reconciliation of non-GAAP measures that it discusses as part of its annual guidance or long term outlook because certain significant information required for such reconciliation is not available without unreasonable efforts or at all, including, most notably, the impact of exchange rates on Iron Mountain’s transactions, loss or gain related to the disposition of real estate and other income or expense. Without this information, Iron Mountain does not believe that a reconciliation would be meaningful. $ in MM Adjusted EBITDA 1,435$ 1,485$ Non-cash stock compensation / other (including non-cash permanent withdrawal fees) 45 45 Adjusted EBITDAand non-cash expenses 1,480$ 1,530$ Less: Amortization of capitalized sales commissions 20 20 Cash interest and normalized cash taxes 500 480 Total maintenance CapEx and non-real estate investment 165 155 Customer inducements and acquisition of customer relationships (1) 60 60 Cash available for dividends and investments 735$ 815$ Expected common dividend to be declared 675 675 Cash available for core and discretionaryinvestments 60$ 140$ 2018E $335 $100 $650 $200 $75 $140 Base Acquisitions Real Estate Inv. Net of Sales; Innovation2 Credit Suisse and EvoSwitch Data Center Acquisitions Incremental Capital Needed for 2018 Discretionary Investments from Borrowings and ATM Data Center Expansion in $MM Prudent Investment for Future Growth (4)
  10. 10. !9
  11. 11. IRM Energy Use MWh Data Cntr Growth
  12. 12. On site Generation Delivered Green Energy Deals Virtual PPA Contracts Green Power 
 Solution Stack Goal: Achieve 100% Green power at all locations with: • Lowest cost • Lowest Risk • Stabilized rates • Most ESG impact
 2nd goal: Use Green Power deals & technology to improve: • Autonomy/ Resilience • Power Quality/ Reliability • Customer Value proposition • Positive ESG impact
  13. 13. Pretty Prairie, Kansas 220 MW Wind Farm: Dec 2019 • Total production • 1 GWh/ yr • +80,000 US homes • CO2 = 150,000 cars • $50M in farm payments • 15-20 long term jobs
 • Anchor customer with
 2/3 of production (145MW) • 600,000 MWh/ Yr • 15 yr stable cost of power • NPV = +$20M
  14. 14. Considerations: Getting to “Yes” Priorities for Finance & Treasury • ROI • Cash flow • Leverage • Risks • More….. !13
  15. 15. Transition to Renewables 100% by 2050 and • 30% by 2020 • 60% by 2030 • 90% by 2040 30% +75% MWh 1% 5% 100% of Data Centers Top 25 overall Top 10 Tech
  16. 16. !15 Lessons? • Finance is full of people • Know your audience and speak their language (or find a translator) • Do your homework