Iron Mountain Inc at Berenberg US Conference (Virtual) Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : So maybe just starting out, thank you guys. Thanks for being here. Maybe just one for Barry. We should probably start high level. Obviously, 2020 was a challenging year. Fundamentals seem to be improving quite nicely as we are in 2021 now. Maybe you can just speak to customer behavior changes over the last year, what have you seen in the last few months and what's your expectation, I guess, for the summer.

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Yes. I think that's a good starting kind of overview. I use the word boxes there, I guess, maybe you can kind of address investor thoughts about the business becoming more digital and just needing less paper over time. I think we've seen through what you reported that volumes continue to hold steady across your different business lines. But maybe you can kind of help investors understand the outlook for kind of paper storage and digital storage and how maybe digital offsets the paper declining. I guess, just give us a sense of your view on that.

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : So if we're thinking maybe longer-term pricing on the storage side, are we talking in the range of 2%, plus or minus? Or does it fluctuate based on what's kind of coming up for renewal that year? Or what's kind of -- and so more to kind of say what's the same-store growth, so to speak, of the storage business? What would you -- how would you answer it, I guess?

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : I appreciate that. Maybe just a follow-up kind of on the word inflation. Obviously, you have a much larger labor force than most REITs. I guess what are you guys seeing on the ground right now in terms of supply for labor and maybe other input costs? And maybe you can kind of integrate what you're doing with projects on there right now and kind of where we are along that cost initiative.

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : No. I appreciate it. Maybe just one last one on the inflation topic. And you have the -- sometimes you get asked about paper pricing and the shred business. Just curious what you're putting in guidance for paper prices? And then I've also been asked in the past, is that even a business line that you could spin out just because of the volatility that it sometimes creates on EBITDA either positively in a good year or negatively in a bad pricing year?

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : No, that's helpful. Maybe we can switch to one of the higher growth areas of the business, just data centers. I think some people that follow you may track data centers closely. They may not. So maybe you could just give a kind of overview of what's the percent of business today that's related to DCs? Where do you maybe see that in 5 years? And maybe just speak to kind of the demand and pricing dynamics that you're seeing today in the markets that you're currently operating in. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 19, 2021 / 5:00PM, IRM.N - Iron Mountain Inc at Berenberg US Conference (Virtual)

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Okay. Maybe the one thing that might be different about you guys compared to other data center companies is that you have so many customers in the storage business that you could potentially cross-sell to. So maybe you could just speak to how much of that data center leasing would you describe as achieved from maybe that cross-selling opportunity and maybe how it helps you get more leasing than you otherwise would.

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : That's helpful. Maybe you can talk about -- because, obviously, it's a high growth area for the company, and you've done some JVs, like you did a big JV in Frankfurt, maybe you can just -- and that was at an earlier stage, and you continue to get bigger and you're going to continue to get bigger. How are you guys viewing retaining data center capacity on balance sheet versus maybe giving it up, so to speak, to a JV? Because you do have a lot of capital sources you can use now to kind of fund the business. So I'm just kind of curious, going forward, if you put stuff into a JV, it limits that percentage of the business that's DCs, and that's growing well. So has the view changed at all over the last maybe 2 years on the thinking on that? Or maybe just speak to your use of the JVs on the data center side.

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Yes. That's helpful. Maybe you could just speak to the wall of capital that's behind the JV curtain, so to speak. So if, for example, the capital markets seized up, the public capital markets, and you wanted to continue the business, maybe you could just talk to what the amount of capital is behind a potential JV so you could continue to build out data centers even if the other sources were not at your disposal. And I guess maybe the question would be, the partner you used for Frankfurt, would they -- I think Bill might have made the comment on one of the calls that they would be open to doing stuff in many markets with you if it made sense. So go ahead.

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Yes. No, that's helpful. I mean maybe you can just expand on the dividend, you mentioned it there at the end. And obviously, there's -- sometimes we get questions about why don't they just cut the dividend in half, the yield is higher than it needs to be compared to data center comps and that's hundreds of millions of dollars they could potentially use to fund the data center growth. So why, I guess, not do it? And so, I guess, what would be your response?

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Okay. Yes, that's helpful. I think you also mentioned the industrial sales in there. How much do you have to sell? How much are you willing to sell longer term? I guess how many years do you kind of have where you can use that as a funding source, I guess? I know it's a large piece right now. So it's seemingly many, many years if you were to continue to sell at the pace you are. But maybe you can just give us some context in just what pricing has been. I mean we know that industrial pricing has been really strong, but what have you seen, I guess, this year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 19, 2021 / 5:00PM, IRM.N - Iron Mountain Inc at Berenberg US Conference (Virtual)

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Okay. Yes, that's helpful color on that. I think, last week, you had that announcement that you sold the IPM business. How many more things are like that, I guess, that you could maybe sell as a capital source? Or how should we think about that sale, I guess?

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Okay. Yes, thanks for kind of the details on that. Maybe kind of just to put a bow in the capital funding bucket. There's certainly people that ask us about the likelihood of any equity issuance at these levels just given that you're at all-time highs. I think yesterday, I know you had a response on the last quarterly call, but I think it would be helpful for those who maybe didn't hear it to hear it again from you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 19, 2021 / 5:00PM, IRM.N - Iron Mountain Inc at Berenberg US Conference (Virtual)

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Okay. That's helpful. Maybe just a high-level one that I think we might have skipped over in the beginning is just, for the storage business, how should we think about volumes globally, just the U.S. versus international? Just maybe it'd be helpful for people to get a sense of the maybe unvended opportunity that's out there. And the federal piece, that used to dominate calls a few years ago when I covered you guys. Has there been any -- because they had to freeze the footprint, I think, years ago. And just curious, is there anything that's changed with the new administration that would maybe unlock some things there? And then even on the data center side, I think maybe you can speak to if you'll do any business with the federal government or contractors because I think some of the other data center providers would say that the federal builds in data center are generally higher yielding just given the specs that are required. So I know there was a lot in that question, but...

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Okay. That's helpful. I mean I think we're up against the time here, but is there anything that we didn't touch on that has been top of mind with investors lately or anything else that you wanted to convey that maybe I didn't ask?

Question: Nathan Daniel Crossett - Joh. Berenberg, Gossler & Co. KG, Research Division - Analyst : Okay. I appreciate the time. Thank you.