Iron Mountain Financial Model

• Total assets: Approximately $16 billion to $18 billion.
• Key asset categories: Property, Plant, and Equipment (PP&E), Operating Lease Right-of-Use Assets, and Goodwill.
• Goodwill & intangibles as % of total assets: High (30% to 40%) due to a long history of bolt-on acquisitions in the RIM space and recent ALM acquisitions.
• Working capital profile:
• Days Sales Outstanding (DSO): 55 to 65 days.
• Days Inventory Outstanding (DIO): Not material (service and storage business).
• Days Payable Outstanding (DPO): 45 to 55 days.
• Net working capital as % of revenue: Slightly positive but generally a small percentage of revenue.
• Is working capital positive or negative?: The company operates with relatively neutral working capital, relying on debt and operating cash flow to fund growth.
• PP&E: Consists of land, buildings, racking structures, data centre infrastructure, and vehicles.
• Right-of-use assets / operating leases: Highly material, as the company leases a significant portion of its storage facilities.

• Capex as % of revenue: 15% to 20%, heavily skewed towards growth.
• Maintenance capex vs. growth capex: Maintenance capex is very low (2% to 3% of revenue). Growth capex (real estate, data centre development, racking) consumes the vast majority of capital.
• Major capex programmes underway: Aggressive data centre buildouts, with a total potential capacity of 1,340 MW across global markets.
• Capitalised software / development costs: Minimal compared to physical infrastructure.
• M&A pattern: Serial acquirer. Historically focused on bolt-on RIM acquisitions globally, but recently shifted to ALM (e.g., Regency Technologies) and data centre joint ventures.
• Typical acquisition multiple paid: 10x to 14x EBITDA for data centre and ALM assets.

• Total debt: Net debt is approximately $15.5 billion as of late 2025.
• Debt/EBITDA ratio: Net lease-adjusted leverage sits at 4.9x, within the company's target range.
• Credit rating: Non-investment grade (BB- / Ba3 typical range).
• Key debt instruments: Senior unsecured notes, term loans, and a large revolving credit facility.
• Maturity profile: Weighted average maturity of approximately 4.5 to 4.6 years.
• Interest rate profile: Weighted average interest rate of approximately 5.7%, with a mix of fixed bonds and floating rate bank debt.
• Covenants: Maximum lease-adjusted leverage ratios and minimum fixed charge coverage ratios.
• Share repurchase programme: Not active. The company uses capital for dividends and growth capex.
• Dividend policy: High payout ratio typical of REITs. The quarterly dividend is $0.864 per share for 2026, yielding approximately 3.5% to 4.5% depending on share price.

• Operating cash flow conversion: Very strong, though heavily burdened by cash interest payments.
• Free cash flow margin: Adjusted Free Cash Flow (excluding growth capex) is high, but reported Free Cash Flow is often negative or low due to massive data centre investments.
• Major non-cash items: Depreciation, amortisation, stock-based compensation, and deferred income taxes.
• Working capital cash flow impact: Minimal impact year-over-year.
• Capex intensity: High. The company deployed approximately $1.8 billion in growth-oriented capital in 2025.
• Cash tax rate vs. GAAP effective tax rate: Cash taxes are very low because Iron Mountain operates as a REIT, distributing the majority of its taxable income to shareholders.

1. Assumptions: Hardcoded drivers for macroeconomic inputs, segment growth rates, pricing, margins, and capital allocation.
2. Scenarios: Toggle for Base, Bull, and Bear cases affecting data centre leasing velocity and ALM pricing.
3. Revenue Build: Detailed build for Storage Rental (RIM volume, Data Center MW leased, ARPU) and Service (ALM volume, digital solutions growth).
4. Operating Costs: Facility costs, labour, fleet, and SG&A broken down by fixed versus variable components.
5. Income Statement: Consolidated GAAP income statement mirroring the 10-K format.
6. Balance Sheet: Assets, liabilities, and equity, highlighting PP&E, ROU assets, and debt tranches.
7. Cash Flow Statement: Standard GAAP cash flow statement.
8. REIT Metrics (FFO & AFFO): Reconciliation of Net Income to NAREIT FFO, Normalized FFO, and AFFO.
9. Debt Schedule: Tranche-by-tranche debt build, interest expense calculation, and leverage covenant tracking.
10. Capex & Depreciation: Waterfall schedules for maintenance capex, data centre growth capex, and associated D&A.
11. Valuation (DCF & Multiples): Discounted cash flow using AFFO, and relative valuation using Price/AFFO and EV/EBITDA multiples.

1. Storage Rental Revenue = Prior Period Storage Revenue x (1 + Volume Growth Rate + Price Increase Rate)
2. Data Center Revenue = Billed Megawatts x Average Revenue per Megawatt
3. Service Revenue = Prior Period Service Revenue x (1 + Organic Service Growth Rate) + Acquired Service Revenue
4. Total Revenue = Storage Rental Revenue + Service Revenue
5. Storage Gross Profit = Storage Rental Revenue - Storage Facility Costs - Storage Labour Costs
6. Service Gross Profit = Service Revenue - Service Labour Costs - Transportation Costs
7. Adjusted EBITDA = Net Income + Interest Expense + Tax Expense + D&A + Restructuring Costs + Stock-Based Compensation
8. NAREIT FFO = Net Income + Real Estate Depreciation + Amortisation of Real Estate Intangibles - Gains on Sale of Real Estate
9. AFFO = NAREIT FFO + Non-Real Estate D&A + Stock-Based Compensation - Maintenance Capex - Straight-Line Rent Adjustments
10. Net Lease-Adjusted Leverage = (Total Debt - Cash + Capitalised Operating Leases) / Adjusted EBITDAR
11. Dividend Payout Ratio = Total Dividends Paid / AFFO
12. Interest Expense = Average Debt Balance x Weighted Average Interest Rate

The Revenue Build feeds directly into the Income Statement and drives the variable components of the Operating Costs sheet. The Operating Costs sheet feeds the Income Statement to calculate EBITDA. The Capex & Depreciation sheet feeds PP&E on the Balance Sheet, D&A on the Income Statement, and Maintenance Capex on the REIT Metrics (FFO & AFFO) sheet. The Debt Schedule calculates interest expense, which feeds the Income Statement and Cash Flow Statement. A circularity exists between the Debt Schedule (revolver draw), the Cash Flow Statement (cash available for debt paydown), and the Income Statement (interest expense).

• Revenues and assets are positive.
• Expenses, capital expenditures, and liabilities are positive in their respective build schedules but subtracted in aggregation formulas.
• Cash outflows on the Cash Flow Statement are negative.
• Dividends paid are negative on the Cash Flow Statement.

• Foreign Exchange Volatility: Iron Mountain operates globally. Fluctuations in the US Dollar can swing reported revenue by 2% to 4% year-over-year. The model must include a constant-currency toggle.
• Project Matterhorn Costs: The company frequently reports restructuring and transformation charges. Failing to add these back will artificially depress Adjusted EBITDA and FFO.
• Capex Misclassification: Confusing maintenance capex with growth capex will severely distort the AFFO calculation. Only maintenance capex is deducted to arrive at AFFO.
• ALM Revenue Lumps: The Asset Lifecycle Management business is highly transactional and depends on component remarketing prices. Straight-lining this growth will lead to inaccurate quarterly forecasts.
• Interest Rate Sensitivity: With $15.5 billion in net debt, a small error in the weighted average interest rate assumption will cause massive swings in FFO and Net Income.
• Lease Accounting: The company has significant operating leases. The model must correctly handle the amortisation of Right-of-Use assets to reconcile GAAP earnings to Adjusted EBITDA.
• Paper Price Fluctuations: The secure destruction business sells recycled paper. Spot price volatility in recycled paper can unexpectedly impact Service margins.
• Data Center Fill Rates: Assuming immediate revenue recognition on new data centre builds will overstate revenue. The model must account for the lag between capital deployment and lease commencement.

• Leverage Check: Net lease-adjusted leverage should remain between 4.5x and 5.5x. Flag if it exceeds 5.5x.
• Dividend Coverage: The AFFO payout ratio should remain between 60% and 75%. Flag if the dividend exceeds AFFO.
• Margin Band: Adjusted EBITDA margin should remain in the 35% to 39% range based on historical performance.
• Revenue Mix: Service revenue should gradually increase as a percentage of total revenue due to ALM and digital growth.
• Balance Sheet Balancing: Total Assets must equal Total Liabilities plus Equity in every forecasted period.
• Data Center Yield: The implied return on data centre growth capex should align with industry standards (typically 9% to 12% cash-on-cash yield).
• Interest Coverage: Adjusted EBITDA to Interest Expense should remain comfortably above 2.5x.

• Filings: SEC EDGAR for Iron Mountain (IRM) 10-K, 10-Q, and 8-K filings. The Investor Relations page provides crucial supplemental financial packages detailing segment-level metrics.
• Key Peers: Equinix (EQIX) and Digital Realty (DLR) for the data centre segment. There are no direct publicly traded peers for the global physical records storage business.
• Industry Data: NAREIT (National Association of Real Estate Investment Trusts) for standard FFO and AFFO reporting guidelines.
• Consensus Estimates: Bloomberg or FactSet for consensus AFFO and revenue estimates.
• Proprietary Data: DatacenterHawk or Synergy Research Group for data centre leasing rates and market absorption metrics.

• Iron Mountain Q4 2025 Earnings Release and Supplemental Financial Information (February 12, 2026)
• Iron Mountain 2024 and 2025 Form 10-K filings via SEC EDGAR
• Iron Mountain Investor Relations Website (investors.ironmountain.com)
• Zacks Equity Research reports on Iron Mountain (August 2025 and March 2026)
• Seeking Alpha analysis on Project Matterhorn and ALM segment growth (February 2026)