Lok'n Store Share Discussion Threads

[konil] 12/4/2005 08:25

at the current price investors are getting a 10% discount on the property nav (assuming a very conservative uplift for kingston from £2.75m to £10.75m, its more likely to be £15m to £20m) and the profitable storage business for free!
and reading residential permission will add further value!!

i can't see this undervaluation lasting too long :)

[wan] 12/4/2005 07:58

Sirmoori...Ok, link for interim results -



Regards, wan

[sirmoori] 12/4/2005 07:44

Wan, I guess you will put in a link to the full interims. Meanwhile, this might help those unfamiliar with LOK:

LOK'NSTORE GROUP PLC

('Lok'nStore' or 'the Group')


Interim Results

for the six months to 31 January 2005


Lok'nStore Group Plc, one of the leading companies in the fast-growing
self-storage market, which operates 19 stores in the South East, announces
interim results for the six months ended 31 January 2005.


Highlights


* Turnover increased by 24% to £3.89 million (£3.14m: six months to 31.1.04)

* Operating profit £320,261 (Loss -£131,827 *: six months to 31.01.04)

* Profit before tax of £75,903 (Loss - £169,237 *: six months to 31.01.04)

* Store EBITDA of £1.233 million (six months to 31.01.04: £0.734 million)

* Customers up 21.2% to 5,790 from 4,776 in January 2004

* Properties valued at £33.6 million (NBV £18.4 m)

* Further significant uplift in value expected from potential Kingston
residential development.

* Planning permission for high-density residential scheme at Kingston site
granted. Permission is for 124 flats, and a new GP surgery of
approximately 7,000 square feet.


* After 31/01/2004 exceptional items - £127,407

[wan] 12/4/2005 07:30

A very solid set of results where I believe the profitable trend of the storage business has now been set, property values are up significantly and we still have the Kingston news flow and effect to come ;-)

[wan] 08/4/2005 09:02

Interesting comments in Shares mag (the same as my last post regarding figures), also Baird has LOK as outperform. Yesterday I visited a what must have been an at least a 80% full, lok'n Store site, the 'enthusiastic' staff actually had to hunt to show me any available unit sizes that I was interested in (some sizes were full), however, that was only one site. As I have always suggested, the underlying business is one growth aspect and the property aspect another, interesting indeed.

I look forward to the results on the 12th April, where I am sure the property aspect might steel the lime light, but the growth prospects of this business going forwards should not be underestimated.

Regards, wan

[konil] 05/4/2005 09:19

if the recent fall was due to year end book squaring then we should see some positive action in the next week or so

and we cant be that far away from company announcements, they will surely provide update on commercial property revaluation which they commissioned some months ago but i hope they also mention progress with reading site residential planning permission

and i'm looking forward to report of healthy results and outlook for the storage business

roll on announcements!

[konil] 30/3/2005 11:20

i'm guessing the selling today and the associated share price drop is due to investors balancing their books prior to the financial year end

does anyone have any information to the contrary??

[wan] 22/3/2005 12:28

AR...You are welcome. Fwiw, I fancy we have an interesting period coming up, which might include the next leg of share price performance, purely a gut feel though.

Keeping it very simple and conservative, I estimate that the NAV is circa £1.60 i.e last property valuation = £20m plus the uplift from the next re-valuation apparently at circa £10m = £30m, plus Kingston @ £10m divided by 25m shares in issue. So that gives the 'potential' Reading planning permission (and any other properties elsewhere that would make a suitable residential conversion, there are apparently others?) in the price for nothing, along with the growth potential that this business should start to realise from a very under-developed market, exposure to the previously highlighted likelihood of any industry consolidation, and not to be overlooked, a chance of receiving any of the cash that might be returned to share holders from the Kingston sale, and last but not least, the management confidence in "delivering substantial growth in shareholder value" On a risk reward basis this still appears to warrant an accumulation stance.

The above is in my opinion only, so please conduct your own research as I could be either wrong or inaccurate. I hold shares in LOK.

Regards, wan

[alanrussell] 21/3/2005 17:42

Wan, many thanks for the reply.

[wan] 21/3/2005 13:37

AR...With such a under-developed market, LOK are still in the very early stages of development, so I am not that surprised. However, the debt has serviced the acquisition of properties that have in their own right increased substantially in value, but are not shown as such on the balance sheet (check previous RNS announcements). Importantly this includes Kingston which received Planning permission for high density residential development. For your further consideration -

A reminder of the Kingston announcement -



Then consider the budget statement regarding stamp duty, which implies to me that Kingston has at the 'very least' increased in desire, and have a somewhat firmer price under its potential value of between £10-£15m? Apparently the Kingston site might fetch £10m if sold to developers, but if I were in the management's position, I would seriously consider developing the site myself, or at least partnering to realise more of the projected developed value of £30m! As a long term investor I am in no hurry, however, I take the point that any management must to play to their strengths.

Furthermore we should get an update regarding the Reading planning application at the results announcement in three weeks time, but for now I can confirm that the initial application for outline pp has been submitted. Link to the improved and updated Reading website -

Planning application -

The case officer is currently unavailable until Wednesday, but from what I can gather he has recommended for refusal, however, those who watched/followed the pp at Kingston will note that this is not unusual at this stage. I will in due course speak with the planning officer and post accordingly.

Then for good measure we have to consider the recently announced property re-valuation, also due in three weeks along with the results, which should result in another circa £10m uplift in values? As I said in the opening post, LOK is an interesting mix/play.

Regards, wan

[alan russell] 19/3/2005 11:32

I have been keeping an eye on LOK for a while. I like companies with land as assets; not so much from the development potential view, more as a backstop to underpin valuation should the core business go sour.

I note in this week's IC that it lists LOK as one of the companies with the lowest interest cover. From 2004 results operating profit (excluding one-offs) £121,674; interest paid - interest received £162,501. Worrying.

Margins seem wafer thin. Taking crude figures t/o £6.6m - expenses = £121,674 = 1.8% margin. Surely LOK's business plan should generate much higher margins. Unfortunately there is no breakdown of admin expenses which may include costs relating to new sites.

Net cash inflow of £934k seems mostly down to an increase in creditors of £675k.

One gets the impression of a company sailing close to the wind. Perhaps this is inevitable with a business plan that foresees a high fixed cost base and profitability/loss balancing on occupancy rate, rather like the hotel business.

Anyone with more knowledge than me (and that should be most of you) care to comment?

[wan] 01/3/2005 08:12

Just in case anyone missed it, results date for your diary -

[kievtrader] 25/2/2005 12:28

Kievtrader in now in Kyiv. Just taken profits on stock here - up 700% in two months.

[konil] 22/2/2005 12:13

looking at the chart i wouldn't be surprised if it retraces to 147p before upwards again

just to clarify, not expecting it to retrace to 147p but wouldn't be surprised if it did

still have my target of 200p+ by march/april

[wan] 22/2/2005 10:03

Well Mercury are happy to continue to build their holding -

[jgoold] 22/2/2005 09:16

I get my worries and excitement elsewhere happy to let LOK be and wait for the market to take notice.

[lingy] 22/2/2005 08:49

yes i agree wan,this share is still firmly in an upward trend,no need to worry about a bit of a rest every now and then.

[wan] 22/2/2005 08:13

Sirmoori...Not much change there then ;-) FWIW I believe LOK's shares are consolidating ahead of the next leg up, which sits well with the expected/announced news flow.

[sirmoori] 21/2/2005 15:01

Hi folks. Me again. Just thought i'd let you know that I've just added 5. Looks like just the three of us!

[wan] 21/2/2005 06:56

It would appear on the face of it that some of the selling Thurs/Fri was due to the Share Mag 'trading' target price (160p) being achieved and reported in the Shares mag this week. However, in the same issue they report on BYG, and close the article with saying that the sector is ripe for consolidation but it is likely that BYG will be the consolidator rather than a victim.

[jgoold] 18/2/2005 22:59

Problem for constant news junkies is that as this story is partly based on property valuation and letting the space they are only going to get infrequent updates - they will get bored and leave. Leaves good value for the patient.

[konil] 18/2/2005 13:05

wan, i'm sticking to my 200p+ target for march/april time

[wan] 18/2/2005 10:51

Looks like some people are loosing patience? However, the shares appear to be being mopped up quite well. For the record I am still 'firmly' invested here, and looking forward to the April results and property update.

[lingy] 09/2/2005 17:38

nice rise today looks like more of the same tomorrow

[wan] 08/2/2005 16:14

Mercury continue to increase their holding -