Digital Core REIT (DCRU) H1 2025 earnings summary

Executive summary

• Distribution per unit (DPU) for 1H25 was 1.80 US cents, unchanged from prior periods, with an annualized yield of 6.85% and stable earnings supported by high occupancy and robust sector demand.

• Portfolio comprises 11 data centres across the US, Canada, Germany, and Japan, with $1.7 billion AUM and 98% occupancy as of June 2025.

• Completed acquisition of a 20% interest in Digital Osaka 3 for approximately $86.7 million, financed by a ¥10 billion bond issuance, enhancing APAC diversification.

• Repurchased and cancelled 1.8 million units at an average price of $0.565, resulting in 0.1% DPU accretion.

• Established a $750 million Euro Medium-Term Note Programme, enhancing access to public debt capital markets.

Financial highlights

• Gross revenue rose 84.2% year-over-year to $88.9 million, driven by acquisitions and higher rental income; net property income increased 52.2% to $46.3 million.

• Distributable income to unitholders grew 3.5% to $23.4 million; DPU held steady at 1.80 US cents.

• Net profit attributable to unitholders fell 35.2% year-over-year to $12.1 million, mainly due to higher finance and trust expenses.

• Net asset value per unit was $0.80 as of June 2025, up from $0.79 at end-2024.

• Aggregate leverage stood at 38.3%, with an all-in average interest rate of 3.6%.

Outlook and guidance

• AI and digital transformation are expected to drive continued growth in digital spending and data centre demand globally.

• Sponsor pipeline supports a path to a $15+ billion portfolio, with over 300 data centres globally and a focus on stabilized, income-producing assets.

• Manager aims to maximize organic growth via leasing and maintain financial flexibility for accretive investments.

• Global economic growth is expected to slow to 2.3% in 2025, but sector fundamentals remain positive.

• Strategic priorities include enhancing scale, diversification, and proactive portfolio management.