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SAFE Safestore Holdings Plc

754.50
5.50 (0.73%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Safestore Holdings Plc LSE:SAFE London Ordinary Share GB00B1N7Z094 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  5.50 0.73% 754.50 755.00 757.00 760.00 750.00 755.50 563,592 16:35:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
General Warehousing, Storage 224.2M 200.2M 0.9179 8.23 1.65B

Safestore Holdings plc Third quarter trading update (6077I)

01/09/2016 7:00am

UK Regulatory


Safestore (LSE:SAFE)
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TIDMSAFE

RNS Number : 6077I

Safestore Holdings plc

01 September 2016

Safestore Holdings plc

Third quarter trading update for the period 1 May 2016 to 31 July 2016

Strong trading performance continues, new store openings on track.

 
 Group Operating Performance      Q3 2016   Q3 2015(2)    Change    Change- 
                                                                     CER(1) 
-------------------------------  --------  -----------  ---------  -------- 
 Like-for-like (LFL) Revenue 
  (GBP'm)                          28.6        26.2        9.2%      6.6% 
-------------------------------  --------  -----------  ---------  -------- 
 Revenue (GBP'm)                   28.6        26.7        7.1%      4.5% 
-------------------------------  --------  -----------  ---------  -------- 
 LFL Revenue- year-to-date 
  (GBP'm)                          82.7        75.2       10.0%      9.0% 
-------------------------------  --------  -----------  ---------  -------- 
 Revenue- year-to-date (GBP'm)     82.7        77.1        7.3%      6.3% 
-------------------------------  --------  -----------  ---------  -------- 
 Closing Occupancy (let sq 
  ft- million) (3)                 3.69        3.61        2.2%       n/a 
-------------------------------  --------  -----------  ---------  -------- 
 Closing Occupancy (% of 
  MLA) (4)                         74.8%      72.2%      +2.6ppts     n/a 
-------------------------------  --------  -----------  ---------  -------- 
 LFL Closing Occupancy (let 
  sq ft- million)                  3.69        3.56        3.7%       n/a 
-------------------------------  --------  -----------  ---------  -------- 
 LFL Closing Occupancy (% 
  of MLA) (4)                      74.8%      72.7%      +2.1ppts     n/a 
-------------------------------  --------  -----------  ---------  -------- 
 Average Storage Rate (GBP)        25.87      24.53        5.5%      2.3% 
-------------------------------  --------  -----------  ---------  -------- 
 Average Storage Rate (GBP)- 
  year-to-date                     25.97      24.75        4.9%      3.9% 
-------------------------------  --------  -----------  ---------  -------- 
 

Highlights

-- Like-for-like Group revenue for Q3 2016 in CER(1) up 6.6% on Q3 2015 with a particularly strong UK performance

o UK up 7.5%

o Paris up 2.3%

-- Group closing occupancy(3) of 74.8% (up 2.6 ppts on Q3 2015) at 3.69 million square feet ("sq ft") with strong UK performance

   --      Group average storage rate up 2.3% in CER(1) in the quarter 
   --      Completion of the Space Maker acquisition on 29 July 2016 

Frederic Vecchioli, Chief Executive Officer commented:

"I am pleased to report continuing positive trading across the business and we remain, as ever, focused on the significant organic growth opportunity represented by our 1.2m square feet of currently unlet space from the existing estate.

In addition, the recent completion of the acquisition of Space Maker and the opening of our newly redeveloped Wandsworth store in August further consolidates our leading UK market position and I look forward to the opening, on time and on budget, of an additional three stores in the UK and one in Paris in the coming weeks.

Market dynamics remain favourable and, combined with positive current trading and the impact of the recent weakening of Sterling on the translation of our Parisian results, as we approach the end of the current financial year, we are confident in generating cash tax adjusted earnings slightly ahead of current market expectations(5) ."

Business highlights

UK Trading Performance

 
 UK Operating Performance         Q3 2016   Q3 2015(2)    Change 
-------------------------------  --------  -----------  --------- 
 Like-for-like (LFL) Revenue 
  (GBP'm)                          21.5        20.0        7.5% 
-------------------------------  --------  -----------  --------- 
 Revenue (GBP'm)                   21.5        20.5        4.9% 
-------------------------------  --------  -----------  --------- 
 LFL Revenue- year-to-date 
  (GBP'm)                          62.6        56.8       10.2% 
-------------------------------  --------  -----------  --------- 
 Revenue- year-to-date (GBP'm)     62.6        58.7        6.6% 
-------------------------------  --------  -----------  --------- 
 Closing Occupancy (let sq 
  ft- million) (3)                 2.86        2.79        2.5% 
-------------------------------  --------  -----------  --------- 
 Closing Occupancy (% of 
  MLA) (4)                         73.0%      70.0%      +3.0ppts 
-------------------------------  --------  -----------  --------- 
 LFL Closing Occupancy (let 
  sq ft- million)                  2.86        2.74        4.4% 
-------------------------------  --------  -----------  --------- 
 LFL Closing Occupancy (% 
  of MLA) (4)                      73.0%      70.5%      +2.5ppts 
-------------------------------  --------  -----------  --------- 
 Average Storage Rate (GBP)        24.29      23.59        3.0% 
-------------------------------  --------  -----------  --------- 
 Average Storage Rate (GBP)- 
  year-to-date                     24.64      23.55        4.6% 
-------------------------------  --------  -----------  --------- 
 

The UK business had another strong quarter growing like-for-like revenue by 7.5%. Performance was strong across the UK with London and the South East up 7.0% and Regional UK up 9.2%.

After the relaunch of our consumer website at the beginning of the financial year, enquiry growth in Q3 was up 10.2% year-on-year, continuing the strong momentum seen at the end of the second quarter. Further improvements were made in the conversion rate and new lets increased by 11.0% in the quarter and 6.4% for the year-to-date.

The third quarter is traditionally the busiest period in the year and, driven by the new lets performance, 170,000 sq ft of occupancy was added since the end of Q2 (2015: 105,000 sq ft added). As a result, Q3 closing occupancy, at 73.0%, increased by 3.0 percentage points compared to the prior year.

As we have previously guided, our rate growth slowed slightly in the quarter and was up 3.0% year-on-year. This is in line with our full year expectations.

In the period since the EU referendum on 23 June 2016, we have seen no discernible change in trading patterns in the UK and we continue to implement our business strategy accordingly.

Paris Trading Performance

 
 Paris Operating Performance      Q3 2016   Q3 2015(2)    Change 
-------------------------------  --------  -----------  --------- 
 Like-for-like (LFL) Revenue 
  (EUR'm)                           8.8        8.6         2.3% 
-------------------------------  --------  -----------  --------- 
 Revenue (EUR'm)                    8.8        8.6         2.3% 
-------------------------------  --------  -----------  --------- 
 LFL Revenue- year-to-date 
  (EUR'm)                          26.1        24.8        5.2% 
-------------------------------  --------  -----------  --------- 
 Revenue- year-to-date (EUR'm)     26.1        24.8        5.2% 
-------------------------------  --------  -----------  --------- 
 Closing Occupancy (let sq 
  ft- million) (3)                 0.83        0.82        1.2% 
-------------------------------  --------  -----------  --------- 
 Closing Occupancy (% of 
  MLA) (4)                         82.0%      80.8%      +1.2ppts 
-------------------------------  --------  -----------  --------- 
 LFL Closing Occupancy (let 
  sq ft- million)                  0.83        0.82        1.2% 
-------------------------------  --------  -----------  --------- 
 LFL Closing Occupancy (% 
  of MLA) (4)                      82.0%      80.8%      +1.2ppts 
-------------------------------  --------  -----------  --------- 
 Average Storage Rate (EUR)        38.84      38.59       +0.6% 
-------------------------------  --------  -----------  --------- 
 Average Storage Rate (EUR)- 
  year-to-date                     39.42      38.84       +1.5% 
-------------------------------  --------  -----------  --------- 
 Revenue (GBP'm)                    7.1        6.2        14.5% 
-------------------------------  --------  -----------  --------- 
 Revenue (GBP'm)- year-to-date 
  (GBP'm)                          20.1        18.4        9.2% 
-------------------------------  --------  -----------  --------- 
 

Our Paris business had a solid quarter growing both rate and occupancy with like-for-like revenue now up by 5.2% in CER(1) for the year-to-date. The impact of the significant weakening of Sterling in the period resulted in the Sterling equivalent like-for-like revenue being up 14.5% on Q3 2015.

The business grew occupancy by 26,000 sq ft since the end of Q2 (2015: 37,000 sq ft) resulting in closing occupancy of 82.0%, up 1.2 percentage points compared to the prior year.

Pricing was robust and our average rate was up 0.6% year-on-year in the quarter.

We continue to pursue our strategy of growing revenue by achieving an appropriate balance of rate and occupancy growth.

Space Maker

Safestore completed the acquisition of Space Maker on 29 July 2016. The final initial consideration, after certain downward adjustments, was GBP40.9m. Up to GBP1.4m of deferred consideration may be payable in cash between six months and three years from July 2016, subject to the Space Maker business achieving certain performance targets in that period.

In the year to 30 April 2016, Space Maker delivered EBITDA (before management fees) of GBP3.9m on turnover of GBP8.7m. At the initial consideration price, the Space Maker portfolio has an implied first year net operating income yield of c. 9.5%. Including the deferred consideration, the net operating income yield would be c. 9.2%.

The Space Maker stores have now been fully integrated into the Safestore regional management structure. However, as the transaction completed at the end of the quarter, the trading statistics reported in this announcement are for the existing Safestore business only. Following completion, the acquisition is immediately earnings enhancing and will support the Group's dividend capacity for the current financial year and beyond.

New Stores

We are pleased to confirm that our newly redeveloped Wandsworth store (33,200 sq ft) opened on 26 August 2016. We look forward to the openings of our Birmingham (51,000 sq ft), Altrincham (39,000 sq ft) and Chiswick (42,500 sq ft) stores as well as our Paris-Emerainville (60,000 sq ft) store in the coming weeks. All stores are anticipated to be completed on time and on budget.

Outlook

Reflecting normal industry trading patterns, we anticipate a reduction in occupancy in Q4 compared to Q3. However, early Q4 trading is healthy and, combined with the positive impact of the recent weakening of Sterling on the translation of our Parisian results, we are confident in generating cash tax adjusted earnings slightly ahead of current market expectations(5) .

Ends

1 - CER is Constant Exchange Rate

2 - Q3 2015 is the quarter ended 31 July 2015

3 - Closing occupancy excludes offices but includes 37,750 sq ft of bulk tenancy as at 31 July 2016 (31 July 2015 - 62,772 sq ft); this excludes Space Maker, which was acquired at the end of the quarter

4 - MLA is Maximum Lettable Area

5 - As of today's date, based on the forecasts of 7 analysts, the consensus for cash tax adjusted earnings per share for the year ended October 2016 is 18.9p and the range is from 18.6p to 19.0p

Enquiries

 
 Safestore Holdings plc                         020 8732 1500 
 Frederic Vecchioli, Chief Executive Officer 
 Andy Jones, Chief Financial Officer 
 
 www.safestore.com 
 
 Instinctif Partners                            020 7457 2020 
 Mark Reed 
  Guy Scarborough 
 

Notes to editors:

 
 --   Safestore (excluding Space Maker) is the UK's largest self-storage group with 119 stores, 
       comprising 95 wholly owned stores in the UK (including 56 in London and the South East with 
       the remainder in key metropolitan areas such as Manchester, Birmingham, Glasgow, Edinburgh, 
       Liverpool and Bristol) and 24 wholly owned stores in the Paris region. 
 --   Safestore completed the acquisition of Space Maker on 29 July 2016, which has added an additional 
       12 stores to Safestore's store portfolio, increasing the number of wholly owned stores to 
       131. As the acquisition of Space Maker completed at the end of the quarter, the trading statistics 
       reported in this announcement are for the existing Safestore business only 
 --   Safestore operates more self-storage sites inside the M25 and in central Paris than any competitor 
       providing more proximity to customers in the wealthiest and densest UK and French markets. 
 --   Safestore was founded in the UK in 1998. It acquired the French business "Une Pièce en 
       Plus" ("UPP") in 2004 which was founded in 1998 by the current Safestore Group CEO Frederic 
       Vecchioli. 
 --   Safestore has been listed on the London Stock Exchange since 2007. It entered the FTSE 250 
       index in October 2015. 
 --   The Group (excluding Space Maker) provides storage to around 49,000 personal and business 
       customers. 
 --   Safestore (excluding Space Maker) has a maximum lettable area ("MLA") of 4.925 million sq 
       ft (excluding the expansion pipeline stores) of which 3.686 million sq ft is currently occupied. 
 --   Safestore employs around 525 people in the UK and France. 
 

This information is provided by RNS

The company news service from the London Stock Exchange

END

TSTDMGFRKMGGVZM

(END) Dow Jones Newswires

September 01, 2016 02:00 ET (06:00 GMT)

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