Dan Newman
感谢William，大家好。幻灯片8总结了我们的第三季度业绩。2016年第三季度，服务收入同比增长57%，环比增长14%。我们的调整后EBITDA利润率达到26.2%，这体现了我们的运营杠杆效应。在幻灯片9上，您可以看到总签约面积同比增长70%，环比增长31%，达到5.8万平方米。总使用面积同比增长63%，环比增长7%，达到3.4万平方米。由于销售增长强劲，合同积压（签约面积与使用面积之差）几乎翻了一番。合同积压是一个重要指标，因为它为我们未来的收入增长提供了可见性。截至2016年9月30日，我们2.4万平方米的积压中，约1.1万平方米与已投入服务的面积相关，1.3万平方米与在建面积相关。基于最低合同承诺，这些积压大部分将在未来四到五个季度内交付。我们总是基于合同最低值进行规划，但实际上，我们持续看到客户提前入驻。积压订单的平均售价（ASP，按每平方米计算）与我们当前创收空间的售价保持一致。
此时，我想向大家更新一个客户发展情况。我们最近了解到，我们的一位客户打算终止与我们的合同，原因是该客户与其在中国的一家竞争对手合并。截至2016年9月30日，该客户占我们总签约面积的3.7%，占我们使用面积的3.6%，并且位于我们的上海一号和二号数据中心。我们正在处理细节，但我们预计该客户将在2016年底或2017年1月初终止合同。我们有权获得相当于合同约9个月收入的终止费。我们对上海数据中心有强劲需求，因此，我们有信心在2017年中之前重新售出该客户终止的空间。总之，合同终止对我们的业务并不重大，不会对我们的2016年和2017年财务表现产生负面影响。我们将在报告2016年第四季度业绩时提供重新销售进展的更新。
转向幻灯片10，我们服务收入较上一季度的增长主要归因于：(1) 客户入驻导致使用面积增加；(2) 我们广州一号和深圳二号数据中心产生的收入增加，这两个数据中心于2016年第二季度开始运营。2016年第三季度，我们的月度服务收入降至每平方米2,675元人民币（或401美元），而2016年第二季度为每平方米2,780元人民币。这一小幅变化是由于新合同开始时的过渡期内，新使用空间的计费较低所致。
幻灯片11显示，2016年第三季度调整后EBITDA为7,800万元人民币（或1,170万美元），较2015年第三季度增长82.7%，较2016年第二季度增长65.2%。2016年第三季度调整后EBITDA利润率为26.2%，而2015年第三季度为22.5%，2016年第二季度为20%。不包括IT设备销售及相关成本，2016年第三季度的调整后EBITDA利润率为27.4%。2016年第三季度末，已投入服务面积的利用率为70.4%，而2015年第三季度末为56%，2016年第二季度末为66.2%。
幻灯片12显示，我们的资本支出在2016年第三季度增加至3.869亿元人民币（或5,800万美元），主要原因是上海三号数据中心的加速开发、新收购的广州一号数据中心的完工成本以及深圳四号项目的启动。对于我们在建的数据中心，截至2016年第三季度末，我们需要再投入17亿元人民币（或2.55亿美元）来完成建设和全面装修。我们已为在建数据中心实现了34.5%的整体预签约率，这反映了需求的强劲。我们手头有大量需求，并且正在处理计划从现在到2017年中投入服务的可用资源的合同。
现在，转向幻灯片13的资产负债表和流动性，截至2016年9月30日，总债务为39亿元人民币（或5.896亿美元），其中83%为长期债务。我们拥有现金7.987亿元人民币（或1.198亿美元），IPO的净收益（扣除承销折扣和IPO相关费用后）为1.8亿美元。按IPO净收益模拟计算，2016年第三季度末，我们的净债务与上季度年化调整后EBITDA的比率为6.2倍。我们认识到，我们的杠杆水平高于成熟市场数据中心业务的典型水平。然而，我们的许多债务是基于项目的，并与这些项目的现金流挂钩。因此，我们可以管理更高的名义债务水平。我们有信心管理当前及未来更高水平的债务。
最后，我们不会在今天的业绩电话会议中提供前瞻性指引。我们打算在报告2016年第四季度业绩时提供2017年的前瞻性指引。我们的准备发言到此结束。现在欢迎提问。主持人，请开始。
Dan Newman
Thank you, William, and hello everyone. Slide 8 summarizes our third quarter results. Service revenue grew by 57% year-over-year and 14% sequentially in the third quarter of 2016. Our adjusted EBITDA margin hit 26.2%, a sign of our operating leverage. On Slide 9, you will see the total area committed increased 70% year-over-year and 31% sequentially to 58 thousand square meters. Total area utilized increased 63% year-over-year and 7% sequentially to 34 thousand square meters. As a result of the strong sales growth, contract backlog (the difference between area committed and utilized) nearly doubled. Contract backlog is an important metric as it provides visibility to our future revenue growth. Out of our 24 thousand square meter backlog as of September 30, 2016, around 11 thousand square meters relate to area already in service and 13 thousand square meters relate to area under construction. Based on minimum contractual commitments, the backlog will be largely delivered within the next four to five quarters. We always plan on the basis of contractual minimums, but in practice, we consistently see our customers moving in ahead of schedule. Average Selling Price (ASP) for the backlog, as measured per square meter, is in-line with what we are achieving for our current revenue-generating space. At this point, I’d like to update you on a customer development. We recently became aware that one of our customers intends to terminate its contracts with us as a result of a merger between the customer and one of its competitors in China. This customer represented 3.7% of our total area committed and 3.6% of our area utilized, as of September 30, 2016, and was based in our Shanghai number one and two data centers. We are working through the details, but we expect the customer to terminate either at the very end of 2016 or early in January 2017. We are entitled to a termination fee equal to around 9 months revenue from the contract. We have strong demand for our Shanghai data centers and, as a result, we are confident we can re-sell the space terminated by this customer bymid-2017. In sum, the contract termination is not material to our business and it will not negatively impact our 2016 and 2017 financial performance. We will provide an update on our re-sale progress at the time we report our fourth quarter 2016 earnings. Turning to Slide10, the increase in our service revenue over the previous quarter was mainly due to (1) an increase in area utilized as customers moved in and (2) an increase in revenue generated by our Guangzhou number one and Shenzhen number two data centers, which commenced operations during the second quarter of 2016. Our monthly service revenue decreased to 2,675 RMB (or 401 dollars) per square meter for the third quarter of 2016, compared with 2,780 RMB per square meter for the second quarter of 2016. This slight change is a function of lower billing for new utilized space during the transitional period at the start of new contracts. Slide 11 adjusted EBITDA was 78 million RMB (or11.7milliondollars) in the third quarter of 2016, an 82.7% increase over the third quarter of 2015 and a 65.2% increase over the second quarter of 2016. Adjusted EBITDA margin was 26.2% in the third quarter of 2016, compared with 22.5% in the third quarter of 2015 and 20% in the second quarter of2016. Excluding IT equipment sales and related costs, adjusted EBITDA margin for the third quarter of 2016 was27.4%. Utilization rate of area in service was 70.4% at the end of the third quarter of 2016, compared with 56% at the end of the third quarter of 2015 and 66.2% at the end of the second quarter of2016. Our capital expenditures on Slide 12 increased in the third quarter of 2016 to 386.9 million RMB (or 58 million dollars) mainly due to the accelerated development of our Shanghai number three data center, the cost of completing the newly acquired Guangzhou number one data center and the initiation of our Shenzhen four project. For our data centers under construction, as of the end of the third quarter of 2016 we need to incur an additional 1.7 billion RMB (or 255 million dollars) to complete the construction and full fit out. We have achieved an overall pre-commitment rate of 34.5% for data centers under construction, which reflects the strength of demand. We have significant demand in hand and contracts in process for the available resource that is scheduled to come into service between now andmid-2017. Now, turning to our balance sheet and liquidity on Slide 13, as of September 30, 2016, gross debt was 3.9 billion RMB (or 589.6 million dollars), of which 83% was long term. We had cash of 798.7 million RMB (or 119.8 million dollars) and the net proceeds from the IPO were a further 180 million dollars net of underwriting discount and IPO related expenses. Pro forma for the net IPO proceeds, our net debt to last quarter annualized adjusted EBITDA ratio at the end of the third quarter of 2016 was 6.2x. We recognize that our leverage level is higher than you would typically see for mature market data center businesses. However, a lot of our debt is project-based and tied to the cash flows of those projects. As a result, we can manage higher nominal debt levels. We are confident of our ability to manage debt at these levels and higher going forward. Finally, we will not be providing forward-looking guidance as part of today’s earnings conference call. We intend to provide forward-looking guidance for 2017 at the time we report our fourth quarter 2016 earnings. This concludes our prepared remarks. We now welcome your questions. Operator, please go ahead.
