Global Switch secures credit rating upgrade to BBB+ by Fitch

This further upgrade to Global Switch’s already strong investment grade credit rating is testament to the strength of the Company’s established business model and solid financial track record. Fitch highlights the Company’s prime portfolio of large scale data centres and conservative capital structure.

The rating agency notes the increased diversification of borrowings and the extension of the company’s debt maturity profile following successful GBP £350 million and AUD $100 million unsecured bond issues in the last 12 months.

The upgrade also recognises Global Switch’s resilient cash flows supported by its geographically diversified portfolio of assets that benefit from robust, recurring revenue streams generated from long term leases. The strategic positioning of its assets in central, city locations in key telecommunications hubs is noted by Fitch to offer reliable power supplies, high levels of security and a strong operating track record.

Fitch notes that Global Switch is one of the world’s leading players with market dominance in a sector with high barriers to entry, driven by positive macro dynamics including the growing volume of global internet traffic, demand for cloud computing, increased bandwidth requirements and an ongoing trend towards outsourcing.
Having recently launched a new data centre in Sydney, Global Switch now owns and operates a portfolio of ten high quality, high specification, carrier neutral data centres. These assets are multi-tenanted and continue to generate stable rental income growth due to high occupancy levels and low levels of customer churn.
Fitch also references the opportunity for Global Switch to further increase its global footprint in growth cities over the short to medium term. Global Switch has a strong development pipeline which includes near term plans for new sites in Hong Kong and Singapore and the further expansion of its new Sydney East data centre. Thereafter, the Company also has medium term plans to expand its existing sites in Europe. Global Switch maintains a low risk strategy of increasing capacity at existing locations in line with market demand.

John Corcoran, Executive Chairman and CEO, Global Switch, said: “The credit rating upgrade from Fitch recognises the continued resilience of Global Switch and its growing and predictable earnings profile. It is testament to the strength of our balance sheet and diversified portfolio of assets and further enhances our competitive advantage. This will enable us to access the deepest and most consistently available pools of liquidity to increase our financial flexibility and to further reduce our cost of capital.”