Iron Mountain Incorporated

Good morning and welcome to the Iron Mountain Second Quarter 2024 Earnings Conference Call. All participants will be in listen-only mode. If you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. We will limit analysts to one question and you can rejoin the queue. Please note, today's event is being recorded. I would now like to turn the conference over to Jillian Tiltman, Senior Vice President and Head of Investor Relations. Please go ahead.

Thank you, Rocco. Good morning, and welcome to our second quarter 2024 earnings conference call. On today's call, we will refer to materials available on our Investor Relations website. We are joined here today by Bill Meany, President and Chief Executive Officer, and Barry Heitman, Executive Vice President and Chief Financial Officer. After prepared remarks, we'll open up the lines for Q&A. Today's earnings materials contain forward-looking statements, including statements regarding our expectations. All forward-looking statements are subject to risks and uncertainties. Please refer to today's earnings materials, the Safe Harbor language on slide two, and our quarterly report on Form 10-Q for a discussion of the major risk factors that could cause our actual results to differ from those in our forward-looking statements. In addition, We use several non-GAAP measures when presenting our financial results. We have included the reconciliations to these measures in our supplemental financial information. So with that, I'll turn the call over to Bill.

Thank you, Jillian, and thank you all for taking the time to join us today for our discussion of our second quarter results. As you saw in this morning's announcement, this quarter delivered another record financial performance and exceeded our expectations. Reflecting on these results, I am incredibly proud of how our team consistently executes at a high level, putting our customers at the center of everything we do. With our proven growth strategy, we are entering the back half of the year with strong momentum. We continue to see firsthand the power of Project Matterhorn from our commercial teams, who are successfully leveraging our full suite of products and solutions to help position Iron Mountain as an ideal partner to our customers. This customer centricity continues to power our results forward for both customers and our shareholders. Building on our track record of value creation for our shareholders and our strong positive outlook, our board of directors has authorized an increase of our quarterly dividend by 10% to 71.5 cents in line with our AFFO per share growth. I'll now turn to key developments during the quarter and how we executed on our growth strategy, which is aligned to our business segments. As a reminder, our strategic priorities are the following. Driving continued revenue growth in our physical storage records management business. Providing digitally enabled solutions for our 240,000 customers, which allows them to get true competitive advantage out of their physical and digital information. Delivering differentiated data center offerings and offering top tier growth through our global scale and customer trust. and advancing our asset lifecycle management services, which provide security, maximum efficiency, and an environmentally sound lifecycle management approach for our customers' IT assets. To give you some examples of how we have recently applied our services on behalf of our customers, let's begin with our records management business. The first win I wish to highlight shows how our scalable solutions can solve for complex regulatory requirements and address changing customer needs. A European-based pharmaceutical company came to us in need of a global record retention schedule as the company was struggling to manage costs and meet regulatory requirements. As part of our expanding partnership, we are providing a fully managed suite of solutions, including policy center upkeep, advisory services, and a dedicated help desk for queries in a scalable and flexible way that can seamlessly adapt over time as their needs evolve. Continuing with wins in our records management business, I am particularly excited to discuss a couple of digital wins. The first example to highlight is a major contract signed with a large financial institution. The foundation of this win was based upon multiple decades of a trusted relationship with the bank's understanding of our truly differentiated approach to digitally managing and automating workflow. As a result, they selected Iron Mountain to serve as its partner for a long-term transformation of its management of digital and physical documents. On the bank's behalf, Iron Mountain is transforming how it captures both digital and physical documents and their associated metadata across all lines of business, including non-banking internal documents like finance and HR. Our unique offering revolutionizes document processing services for both physical and digital documents. We have achieved this by employing our proprietary leading-edge AI-powered intelligent document processing built into our Insight platform. Continuing with our digital business, in Australia, we have secured a large deal with one of the country's biggest banks to provide our digital mailroom solution, which brings together our operational scale and digital capabilities. Iron Mountain has been a trusted records management partner for over 20 years, and we built on that relationship to develop a comprehensive service offering that will see us manage their physical mailroom sites across Australia and scan around 32 million images a year as we process mortgage documents, checks, vouchers, and other banking documents. Our proven implementation methodology reassured the customer that we could execute a seamless transition of services, and the innovative technology we are deploying will help them to realize significant efficiencies in the years ahead. Moving to our data center business, through the first half of the year, we leased 97 megawatts, which includes 66 megawatts this quarter. Due to our strong pipeline, we feel confident we will exceed our original projection and now expect to lease 130 megawatts for the year. The speed of leasing in the first half of the year is thanks to the momentum that our team has built in our leasing pipeline. We are an attractive partner to customers looking for infrastructure which can support their very dense IT workloads and associated with their AI-enabled services. Here are some examples of wins during the quarter from our US and UK markets. At our Western Pennsylvania location, we welcomed a new hyperscale customer with a seven-year contract. Since signing the contract, the customer is already in discussions about potential expansion to some of our other campuses. A good example of our continued and growing partnerships with some of the largest hyperscalers are recent wins this quarter with a single customer in both the US and UK markets. This customer has placed a 10-year contract with us for almost 25 megawatts of capacity at our London data center campus and a 15-year contract for 36 megawatts at our data center campus in Phoenix, Arizona. Also at our Phoenix campus, we have won a 10-year co-location contract with one of Japan's largest banks. We will be providing 800 kilowatts of capacity to support the complete transformation of this customer's North American IT platform. Turning to our asset lifecycle management business, we continue to see established Iron Mountain customers seek new solutions from our ever-expanding portfolio. A perfect example of this is how we expanded the relationship with an insurance company that has been an Iron Mountain customer since the late 1950s. Having secured a small ALM project with them last year, Our customers' confidence in our capabilities and our delivery record has led them to make us their sole ALM provider. Finally, I'd like to share a last example of a customer that has added our ALM services to the Iron Mountain Solutions, from which they already benefit. This global cloud-based software company has asked us to manage an ALM program to securely destroy, remarket or recycle data center assets at more than 30 locations in North America, EMEA, Latin America, and the Asian Pacific regions. Demonstrating we can provide a full-service global ALM offering is no small task, but our skilled and dedicated teams successfully met the challenge. We are now a proud ALM partner for this customer alongside the records management and digital solutions that we already provide. To conclude, we have thoughtfully and strategically curated a mountain range of best in class solutions and an effective operating model under Project Matterhorn. This quarter's successes are a brief testament to the value our strategy is already delivering and a window into the future we are building at Iron Mountain. As we continue to expand our footprint of storage and services and deliver tailored, innovative solutions for each of our customers, I could not be more grateful for the hard work of our Mountaineers. Our strategy and execution is showing the way in delivering consistently strong revenue growth in the resulting financial model that delivers top-tier growth in both our AFFO and our dividend. We have an energized team of experienced, proven operators who are committed to excellence, and that gives us great confidence in our future. With that, I'll turn the call over to Barry.