Big Yellow Regulatory News (BYG)

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Results for the Six Months and Second Quarter ended 30 September 2014

STRONG OPERATING PERFORMANCE DELIVERS 29% EARNINGS GROWTH1

Highlights

· Strong revenue performance driving earnings and dividend growth

· Adjusted profit before tax up 29% to £18.4 million

· Cash flow from operating activities (after finance costs) increased by 27% to £17.8 million

· 30% increase in interim dividend to 10.4 pence per share

· Refinancing completed reducing the Group's average cost of debt and extending the average maturity of facilities

· Prominent 70,000 sq ft MLA Gypsy Corner store on A40 in West London opened on 1 April 2014 and early trading has been encouraging

· Acquisition of 35,000 sq ft freehold store in Oxford

· Acquisition of an existing freehold building in Cambridge for conversion to a 55,000 sq ft self storage centre

1 see note 6; 2 see note 8; 3 see note 14; 4 excludes 24,000 sq ft of occupancy acquired with Oxford 2, 5 see Portfolio Summary

Commenting, Nicholas Vetch, Executive Chairman, said:

"In this seasonally stronger trading period, coupled with the improving demand environment for our product, we are pleased to have delivered a strong performance in the first half.

Since the onset of the financial crisis 7 years ago, we have been very focused on making improvements to our capital structure, with particular focus on the liability side of the balance sheet. We now have a sensible level of indebtedness, with a spread of credit maturities from a range of borrowing sources, hedged to accommodate both inflationary and deflationary pressures.

The many problems and challenges, economic and political, are well documented, however we are confident that we have a business model and capital structure that allows us to meet them.

Furthermore, the work on the brand, customer service, systems and operational strategy undertaken over the last few years, leaves us primed to take advantage of any improvement in self storage demand. The core task of filling the stores is both achievable and within sight and we believe will deliver attractive growth in earnings and dividend."

- Ends -

ABOUT US

Big Yellow Group PLC is the UK's leading self storage brand and has the highest market share by revenue. We now operate from a platform of 78 stores, including 10 stores branded as Armadillo Self Storage. We own a further four Big Yellow self storage development sites, of which two have planning consent. Of the 82 total stores and sites, 91% are held freehold and long leasehold; with the remaining 9% short leasehold. The maximum lettable area of the open stores is 4.7 million sq ft. When fully built out the portfolio will provide approximately 4.9 million sq ft of flexible storage space.

The Group has pioneered the development of the latest generation of self storage facilities, which utilise state of the art technology and are located in high profile, accessible, main road locations. Our focus on the location and visibility of our Big Yellow stores, coupled with our excellent customer service and our market leading online platform, has created the most recognised brand name in the UK self storage industry.

For further information, please contact:

CHAIRMAN'S STATEMENT

Big Yellow Group PLC the UK's brand leader in self storage, is pleased to announce its results for the six months and the quarter ended 30 September 2014.

In this seasonally stronger trading period, coupled with the improving demand environment for our product, we are pleased to have delivered a strong performance in the first half. Overall like-for-like closing Group occupancy is up 5.4 percentage points to 75.2% compared to 69.8% at 31 March 2014. The growth in the average net achieved rent per sq ft was 4.5% compared to the same period last year, resulting in period-on-period revenue growth of 11%. Given that our central overhead and operating expense is largely embedded in the business, this revenue growth has dropped through into a 29% increase in adjusted earnings per share and a 30% increase in the interim dividend.

Occupancy growth over the six month period across all our stores was 288,000 sq ft (2013: 232,000 sq ft). Wholly owned store occupancy growth in the six month period was 214,000 sq ft (2013: 188,000 sq ft). The 32 established store portfolio increased in occupancy from 75.2% at the end of March 2014 to 79.8% in September 2014. The 24 lease-up stores grew in occupancy from 62.8% in March 2014 to 68.0% in September 2014.

The 12 stores in Big Yellow Limited Partnership increased in occupancy to 69.2% (March 2014: 59.8%), growth of 74,000 sq ft from March 2014.

We believe Big Yellow is well placed to benefit from growing awareness and improving self storage demand given our market leading brand and operating platform with a focus on London, the South East and large metropolitan cities where barriers to entry are at their highest.

Financial results

Store revenue for the period was £39.1 million, up 12% from £35.1 million in the comparable period last year, and up 10% compared to the previous half year period (six months to 31 March 2014: £35.6 million).

Total store revenue for the second quarter increased by 11% to £20.5 million from £18.4 million for the same quarter last year and was up 10% from the quarter to June 2014 (£18.6 million).

Store EBITDA for the period was £26.2 million, up 15% from £22.9 million for the same period last year (see Portfolio Summary). The overall store margin was 67.0%, up from 65.2% for the same period last year.

The Group made an adjusted profit before tax in the period of £18.4 million, up 29% from £14.2 million for the same period last year (see note 6). Diluted EPRA earnings per share were 13.0 pence (2013: 10.1 pence), an increase of 29%. Adjusted net assets per share are 461.9 pence, an increase of 6% from 436.3 pence at 30 September 2013 and an increase of 3% from 446.5 pence at 31 March 2014. The Group's statutory profit before tax for the period is £35.3 million, an increase of 2% from £34.5 million for the same period last year.

Investment in new capacity

In July we acquired a freehold store in Oxford from Fort Box Self Storage for £4.1 million. The store has been rebranded as a Big Yellow, and has a current lettable area of 35,000 sq ft, with expansion space for a further 10,000 sq ft. Our existing 33,000 sq ft Oxford store is over 90% occupied and this acquisition will allow us to drive growth in occupancy and rental yield from our operating platform.

We have exchanged contracts to acquire the freehold of a former Royal Mail depot in Cambridge adjacent to the Cambridge Retail Park, Newmarket Road, which we intend to refurbish and convert into a 55,000 sq ft self storage centre, opening in late 2015. We expect the total investment including refurbishment to be approximately £9.3 million.

This is our first new site acquisition for construction in seven years. The acquisition is testament to our confidence in both Cambridge and our business model. It should be noted, however, that the opportunity took 14 years to present itself, despite continual searching over that time. Notwithstanding our desire to grow this business it will remain difficult to procure new sites of sufficient quality. That said, further opportunities will arise and we will exploit them.

In April 2014 we acquired the Armadillo portfolio in a joint venture with an Australian consortium for £19.75 million. Our equity invested in this joint venture is £1.9 million, representing a 20% stake. The business has traded ahead of expectations since April, and in October we received an interim dividend of £89,000, representing a 4.6% yield for the period.

Refinancing

We were pleased to complete the refinancing of our £145 million bank facility during the period with Lloyds and HSBC, extending the maturity to August 2019. We have also further diversified our lending pool by bringing in another insurance company, M&G Investments, who have provided us with a seven year £70 million facility which will be drawn in June 2015. These committed facilities have increased the average unexpired term of our debt facilities to 7.7 years, and reduced our average cost of debt.

The ratio of adjusted Group EBITDA to net interest expense in the period was approximately 4.6 times. Following the refinancing and the growth in operating cash flow over the period, we have achieved our target of greater than five times cover on an annualised basis at 30 September.

Dividends

The Group's dividend policy is to distribute 80% of full year adjusted earnings per share. The interim dividend declared is 10.4 pence per share. This has all been declared as Property Income Dividend ("PID"). The interim dividend declared represents an increase of 30% from 8 pence per share for the same period last year.

Outlook

Since the onset of the financial crisis 7 years ago, we have been very focused on making improvements to our capital structure, with particular focus on the liability side of the balance sheet. We now have a sensible level of indebtedness, with a spread of credit maturities from a range of borrowing sources, hedged to accommodate both inflationary and deflationary pressures.

The many problems and challenges, economic and political, are well documented, however we are confident that we have a business model and capital structure that allows us to meet them.

Furthermore, the work on the brand, customer service, systems and operational strategy undertaken over the last few years, leaves us primed to take advantage of any improvement in self storage demand. The core task of filling the stores is both achievable and within sight and we believe will deliver attractive growth in earnings and dividend.

Nicholas Vetch

Executive Chairman

18 November 2014

BUSINESS AND FINANCIAL REVIEW

Trading performance

The improving UK GDP environment and consumer confidence both in London and regional cities, coupled with growing awareness, has led to improving demand for self storage from both domestic and business customers. This will incrementally feed through to our business, resulting in growing occupancy, earnings and cash flow. This is against a backdrop of limited new supply with very few new store openings committed in our core area of operation.

Our third quarter is historically the weakest trading quarter and in recent years we have typically lost two to three percentage points of occupancy before a return to growth in the new year. Since the end of September we have lost 26,000 sq ft (0.7% of maximum lettable area "MLA"), compared to 32,000 sq ft (0.9% of MLA) lost at this stage last year. The move outs have been in line with our expectations following the strong summer trading.

Store occupancy

The level of enquiries across all our stores increased by 11% compared to the same six months last year. Conversion rates of these enquiries remained strong, meaning total move-ins, including the stores in Big Yellow Limited Partnership, were up 9% on the same period last year. We are experiencing a higher level of churn in the business, with move-outs increasing by a similar amount when compared to the same period last year.

Occupied space increased by 312,000 sq ft across all stores in the period (2013: occupancy growth of 232,000 sq ft). This growth includes 24,000 sq ft of occupancy acquired with the acquisition of Fort Box Self Storage in Oxford (Oxford 2), so the net occupancy growth in the period was 288,000 sq ft (214,000 sq ft in the wholly owned stores).

We saw encouraging growth from domestic, student and business customers during the six month period, with the overall split by occupied space being 67% domestic and 33% business at 30 September 2014. This is broadly unchanged from the same time last year.

The 32 established stores are those that had reached stabilisation as a portfolio in 2007 prior to the economic downturn; 18 of these stores are in London, with the other 14 in large metropolitan cities in the South. This portfolio of stores (with an average net lettable area of 60,300 sq ft) was 79.8% occupied at the end of the period. This occupancy represents an average of 48,156 sq ft occupied per store.

The closing occupancy of the 18 established stores inside London was 81.2%, an average of 52,430 sq ft occupied per store (2013: 77.9%); for the 14 established stores outside London, closing occupancy was 77.7%, an average of 42,625 sq ft occupied per store (2013: 75.3%).

The lease-up stores have grown in occupancy by 138,000 sq ft from the same time last year (excluding the sq ft acquired with Oxford 2), and by 125,000 sq in the six months from 31 March 2014.

Pricing and rental yield

Our core proposition remains a high quality product, competitively priced, with excellent customer service, providing value for money to our customers. Our stores offer a headline opening promotion of 50% off for up to the first 8 weeks, and we continue to manage pricing dynamically, taking account of customer demand and local competition.

The closing net rent at 30 September 2014 was up 0.4% from 31 March 2014, and up 3.5% from 30 September 2013. Our key aim over the next two to three years is to drive occupancy in the stores. As the stores lease-up, our pricing model reduces the level of promotional discounts offered in individual stores. This squeezing out of promotions leads to an increase in net achieved rents. The table below illustrates this, showing the growth in net rent per sq ft for the portfolio over the six month period.

Security of income

Our principal financial aims remain growing cash flow, earnings and dividend. We believe that self storage income is essentially evergreen income with highly defensive characteristics driven from buildings with very low obsolescence risk. Although its form of contract with its customers is in theory as short as a week, it does not need to rely on contract for its income security. At 30 September 2014 the average length of stay for existing customers was 21 months. For all customers, including those who have moved out of the business, the average length of stay has remained at 8 months. In our portfolio, 27% of our customers by occupied space have been storing with us for over two years, and a further 17% of customers in these stores have been in the business for between one and two years.

The location of our stores, brand, security, and most importantly customer service, together with the diversity of our 47,000 customers, will serve better than any contract.

Revenue

Revenue for the established stores increased by 7% compared to the same period last year. EBITDA margins for the 32 established stores increased from 66.0% for the period to 30 September 2013 to 67.6% for the current period.

Revenue in the lease-up portfolio was up 19% compared to the same period last year. The EBITDA margin on the lease-up stores has increased from 63.7% for the period to 30 September 2013 to 66.1% for the current period. The overall store EBITDA margin increased from 65.2% to 67.0%.

Like-for-like revenue per available foot ("REVPAF") was £22.61 for the six months, an increase of 11% from £20.39 for the six months to 30 September 2013.

We continue to improve sales of insurance, packing materials and other ancillary items, with revenue from these areas growing by 7% to £5.9 million in the period (2013: £5.5 million).

Operating costs

Store operating costs have increased by £0.7 million from the prior period, due to the additional costs of Gypsy Corner and Oxford 2, coupled with an increased investment in marketing and general inflationary increases. The movement in cost of sales in the income statement is in line with the increase in store operating costs.

Administrative expenses have increased by £0.2 million, largely as a result of an increase in the non-cash share based payments charge, which represents £0.9 million of the overall £4.2 million expense.

Interest

The loan interest expense during the period was £0.2 million lower than the same period last year, due to the lower average cost of debt following the completion of the refinancing in August 2014. Capitalised interest in the period was £0.2 million, in line with the same period last year, as a result of capital expenditure on Enfield.

Results

The 29% increase in adjusted profit before tax to £18.4 million is reconciled in the table below:

The Group's statutory profit before tax for the period is £35.3 million, an increase of 2% from £34.5 million for the same period last year. The increase in adjusted profit before tax has been partially offset by a lower revaluation gain in the period.

The table below reconciles the statutory profit before tax to the adjusted profit before tax:

Diluted EPRA earnings per share was 13.0 pence (2013: 10.1 pence), an increase of 29% from the same period last year.

Cash flow growth

Cash flows from operating activities (after net finance costs) have increased by 27% to £17.8 million for the period (2013: £14.0 million), in line with the growth in store EBITDA. These operating cash flows are after the ongoing maintenance costs of the stores, which are on average £35,000 per store per annum. The Group's net debt increased in the period by £3.2 million to £229.2 million (2013: £226.0 million).

The capital expenditure in the period principally relates to the construction costs of our Enfield store and the acquisition of the freehold store in Oxford.

The non-recurring finance costs incurred in the period relate to the cancellation of interest rate swaps (£1.4 million) and arrangement fees and costs incurred in completing the refinancing of the bank and M&G loans (£2.5 million).

Taxation

The Group is a Real Estate Investment Trust ("REIT"). We benefit from a zero tax rate on our qualifying self storage earnings. We only pay corporation tax on the profits attributable to our residual business, comprising primarily of the sale of packing materials and insurance, and management fees earned by the Group.

There is a nil tax charge in the non-exempt residual business for the period ended 30 September 2014 (six months to 30 September 2013: £nil), due to the utilisation of brought forward tax losses and group relief.

Dividends

REIT regulatory requirements determine the level of Property Income Dividend ("PID") payable by the Group. A PID of 10.4 pence per share is proposed as the total interim dividend, an increase of 30% from 8 pence per share PID for the same period last year.

The interim dividend will be paid on 8 January 2015. The ex-div date is 11 December 2014 and the record date is 12 December 2014.

Financing and treasury

During the period we completed the refinancing of our £145 million bank facility with Lloyds and HSBC, extending the maturity to August 2019. 50% of the bank facility is term and 50% is revolving. The term loan attracts a margin of 175 bps and the revolving loan a margin of 150 bps, reflecting a reduction of 75bps for both tranches from the previous facility. The Group bank facility requires us to have 50% of all borrowings fixed.

In addition, the Group has further diversified its pool of lenders by signing a new £70 million facility with M&G Investments Limited, the term of which will be seven years from the date of drawdown which can occur at any time in the period up to 29 June 2015. The loan will be secured over a portfolio of 15 freehold self storage centres. 50% of the seven year loan is fixed by way of a forward start interest rate derivative, the balance of the loan is variable based on three month LIBOR plus margin. The average cost of the M&G loan at the current rate of LIBOR will be 3.75%.

The Group agreed a short term bridging facility of £70 million with Lloyds Bank plc, which is repayable immediately on the drawdown of the M&G loan.

The Group has a £100 million 15 year loan with Aviva Commercial Finance Limited. The loan has a fixed interest rate of 4.9% and amortises to £60 million over the course of the 15 years. The loan outstanding at 30 September 2014 was £95.4 million.

During the period the Group cancelled £40 million of its existing interest rate derivatives at a cash cost of £1.4 million, leaving £30 million fixed at 2.8% plus applicable margin.

As a result of this refinancing, and prior to the drawing of the M&G facility, our average cost of debt has decreased from 4.6% to 3.7%. Following the M&G facility being drawn and the Lloyds bridging loan being repaid we would expect the average cost to be approximately 4.2% based on the current levels of LIBOR.

The Group was comfortably in compliance with its banking covenants at 30 September 2014.

The net debt to gross property assets ratio is 28% (2013: 29%) and the net debt to adjusted net assets ratio is 35% (2013: 36%).

Property

We have a pipeline of four wholly owned development sites, of which two have planning consent (Enfield and Guildford Central). Enfield, on the A10 in London, is under construction and will open in April 2015. We are commencing detailed design works on the Guildford Central store, and anticipate that construction will commence in June 2015, with a planned opening in April 2016. These two sites have an aggregate estimated cost to complete of £8.1 million at 30 September 2014. Our site in Cambridge is an existing warehouse building which we intend to refurbish and open in late 2015. We also own a development site in Central Manchester which does not have planning.

The Group's investment properties have been valued by Cushman and Wakefield LLP ("C&W"). At 30 September 2014 the total value of the Group's wholly owned properties is shown in the table below:

Investment property

The valuation uplift for the open stores in the period was £15.0 million, as the growth in cash flows feed through to the valuation, coupled with a reduction in cap rate for a number of the London stores. The table below summarises the key outputs of the valuations for the wholly owned open store portfolio.

The initial yield on the established portfolio of 32 stores before administration expenses and assuming no rental growth, is 7.4% rising to a stabilised yield of 7.7% (March 2014: 7.0% rising to 7.8%). Including the 24 lease-up stores, the initial yield pre-administration expenses is 6.7% rising to 7.7% (March 2014: 6.3% rising to 7.8%).

Investment property under construction

The three wholly owned development sites have increased in value by £1.8 million in line with capital expenditure incurred at Enfield. C&W's forecast valuations for when the assets have reached stabilised occupancy, including assumptions in relation to revenue and operating cost growth within these assets, are currently pointing to a revaluation surplus on total development cost of £16.3 million on the two wholly owned development sites with planning consent.

In their report, C&W have drawn attention to valuation uncertainty resulting from a lack of transactions in the self storage investment market. Please see note 15 for further details.

Surplus land

In September, the Group sold its surplus site at Guildford Central for £2.8 million, representing a profit over book value of £1.3 million.

At 30 September 2014 the Group owned £4.8 million of land surplus to our requirements across two sites. We aim to sell this surplus land once we have maximised its realisable value through planning improvements. The sites are held at the lower of cost and net realisable value and have not been externally valued.

Capital Goods Scheme receivable

At 30 September 2014, we had a receivable of £9.2 million in respect of payments due back to the Group under the Capital Goods Scheme as a consequence of the introduction of VAT on self storage from 1 October 2012. To date, we have received payments under the Capital Goods Scheme of £0.8 million in October 2013, and £1.4 million in October 2014.

Net asset value

The adjusted net asset value is 461.9 pence per share (see note 14), up 3% from 446.5 pence per share at 31 March 2014. The table below reconciles the movement from 31 March 2014.

Big Yellow Limited Partnership

Big Yellow Limited Partnership, a joint investment with Pramerica Real Estate Investors Limited, owns self storage centres outside London. In the consolidated accounts of Big Yellow Group PLC, the Partnership is treated as an associate using the equity accounting method. The Partnership has twelve stores.

The occupancy of the stores is 518,000 sq ft, against a total capacity of 749,000 sq ft, with growth of 74,000 sq ft since 31 March. The stores' occupancy at 30 September 2014 was 69.2% (March 2014: 59.3%). The net rent achieved at 30 September 2014 by the Partnership stores is £18.15 per sq ft, an increase of 5% from the same time last year, and an increase of 0.8% from 31 March 2014. The revenue of the portfolio increased by 17% to £5.6 million for the six months to 30 September 2014 compared to the same period last year.

The Partnership made an operating profit of £3.0 million in the period, of which Big Yellow's share is a third. After net interest costs and the revaluation of investment properties and interest rate derivatives, the profit for the period for the Partnership was £2.5 million, of which the Group's share was £0.8 million.

The Group earns certain construction and operational fees from the Partnership. For the period to 30 September 2014, these fees amounted to £0.3 million (2013: £0.3 million).

The Partnership has a £57 million bank facility with RBS and HSBC expiring in September 2016. Interest rate swaps are in place covering £29 million of the debt at a pre-margin cost of 1.05%. The balance of the drawn debt pays interest based on three month LIBOR plus margin. There is a margin ratchet based on the Partnership's income cover which ranges between 250 bps and 400 bps; the margin is currently 325 bps. The facility's weighted average interest cost is 4.1%.

Big Yellow has an option to purchase the assets contained within the Partnership or the equity interest in the Partnership which it does not own exercisable in March 2015.

Armadillo Self Storage

In April 2014 we acquired the Armadillo portfolio with an Australian consortium for a total price of £19.75 million. The Group initially invested £3.6 million representing an initial stake of 38% in the business. Our partners had a right to increase their share from 62% to 80% at par, which they exercised in July 2014. In the consolidated accounts of Big Yellow Group PLC, our investment in the vehicle is treated as an associate using the equity accounting method. Armadillo has an £11 million loan from Lloyds Bank expiring in April 2019.

The occupancy of the stores is 257,000 sq ft, against a total capacity of 401,000 sq ft, with growth of 17,000 sq ft since 31 March. The stores' occupancy at 30 September 2014 was 64.1% (March 2014: 59.9%). The net rent achieved at 30 September 2014 by the Armadillo stores is £14.38 per sq ft, an increase of 5% from the same time last year and up 2% from 31 March 2014. The revenue of the portfolio increased by 12% to £2.2 million for the six months to 30 September 2014 compared to the same period last year.

Armadillo made an operating profit of £0.9 million in the period, of which Big Yellow's share is £0.3 million (representing 38% until July and 20% thereafter). After net interest costs and the revaluation of investment properties and interest rate derivatives, the profit for the period for Armadillo was £2.4 million, of which the Group's share was £0.5 million.

Big Yellow has a five year management contract in place. For the period from acquisition to 30 September 2014, fees amounted to £0.3 million.

In October we received an interim dividend of £89,000, representing a 4.6% yield for the period.

RESPONSIBILITY STATEMENT

We confirm to the best of our knowledge:

1. the condensed set of Interim Financial Statements has been prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by the European Union;

2. the Interim Management Report herein includes a fair review of the important events during the first six months and description of the principal risks and uncertainties for the remaining six months of the year, as required by Rule 4.2.7R of the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority; and

3. the Interim Management Report includes as applicable, a fair review of disclosure of related party transactions and changes therein, as required by Rule 4.2.8R of the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.

By order of the Board

18 November 2014

BIG YELLOW GROUP PLC

PORTFOLIO SUMMARY - WHOLLY OWNED STORES

(1) The 32 established stores are those that had reached stabilisation as a portfolio in 2007 prior to the economic downturn. Of the 24 lease-up stores, three stores opened before 31 March 2006, six stores opened in the year ended 31 March 2007, seven stores opened in the year ended 31 March 2008 and eight have opened since 1 April 2008. Oxford 2, which was acquired in July 2014, has been included in the lease-up store portfolio, and its results from the date of acquisition have been incorporated.

(2) Total store revenue divided by the average maximum lettable area in the period.

(3) Packing materials, insurance and other storage related fees.

(4) Rent for seven established short leasehold properties accounted for as investment properties and finance leases under IFRS with total self storage capacity of 431,000 sq ft, and one long leasehold lease-up store with a capacity of 64,000 sq ft.

(5) Earnings before interest, tax, depreciation, amortisation and allocation of central overhead.

(6) Of the established stores, the seven leaseholds achieved a store EBITDA of £2.9 million and an EBITDA margin of 53%. The freehold stores achieved a store EBITDA of £12.9 million and an EBITDA margin of 72%.

PORTFOLIO SUMMARY - BIG YELLOW LIMITED PARTNERSHIP AND ARMADILLO STORES

(1) Please note the Group acquired an interest in Armadillo on 16 April 2014. The results shown here are to provide readers with a clearer understanding of the performance of the portfolio. Please see note 9d for the Group's share of Armadillo's results since ownership.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

Six months ended 30 September 2014

Adjusted profit before taxation is shown in note 6 and EPRA earnings per share is shown in note 8.

All items in the income statement relate to continuing operations.

CONDENSED CONSOLIDATED BALANCE SHEET

30 September 2014

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

Six months ended 30 September 2014 (unaudited)

Six months ended 30 September 2013 (unaudited)

Year ended 31 March 2014 (audited)

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

Six months ended 30 September 2014

A. Reconciliation of net cash flow to movement in net debt

Six months ended 30 September 2014

Net debt is defined as gross bank borrowings less cash and cash equivalents.

NOTES TO THE INTERIM REVIEW

1. ACCOUNTING POLICIES

Basis of preparation

The results for the period ended 30 September 2014 are unaudited and were approved by the Board on 18 November 2014. The financial information contained in this report in respect of the year ended 31 March 2014 does not constitute statutory accounts within the meaning of section 434 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditor's report on those accounts was not qualified, did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying the report and did not contain statements under section 498 (2) or (3) of the Companies Act 2006.

The annual financial statements of Big Yellow Group PLC are prepared in accordance with International Financial Reporting Standards ("IFRSs") as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standards 34 "Interim Financial Reporting", as adopted by the European Union. The same accounting policies, presentation and methods of computation are followed in the condensed set of financial statements as applied in the Group's latest annual audited financial statements.

Valuation of assets and liabilities held at fair value

For those financial instruments held at valuation, the Group has categorised them into a three level fair value hierarchy based on the priority of the inputs to the valuation technique in accordance with IFRS 13. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels of the hierarchy, the category level is based on the lowest priority level input that is significant to the fair value measurement of the instrument in its entirety. The fair value of the Group's outstanding interest rate derivatives has been estimated by calculating the present value of future cash flows, using appropriate market discount rates, representing Level 2 fair value measurements as defined by IFRS 13. Investment Property and Investment Property and Investment Property under Construction have been classified as Level 3. This is discussed further in note 15.

Going concern

A review of the Group's business activities, together with the factors likely to affect its future development, performance and position, is set out in the Chairman's Statement and the Business and Financial Review. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are shown in the balance sheet, cash flow statement and accompanying notes to the interim statement. Further information concerning the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk can be found in the Business and Financial Review of the Group's Annual Report for the year ended 31 March 2014.

The Directors have considered carefully the Group's trading performance and cash flows in the context of the uncertain global economic environment and the other principal risks to the Group's performance. After reviewing Group and Company cash balances, projected cash flows, and the borrowing facilities available to the Group, the Directors believe that the Group and Company have adequate resources to continue operations for the foreseeable future. In reaching this conclusion the Directors have had regard to the Group's operating plan and budget and projections contained in the detailed longer term business plan. For this reason, they continue to adopt the going concern basis in preparing the half year report.

2. SEGMENTAL INFORMATION

Revenue represents amounts derived from the provision of self storage accommodation and related services which fall within the Group's ordinary activities after deduction of trade discounts and value added tax. The Group's net assets, revenue and profit before tax are attributable to one activity, the provision of self storage accommodation and related services. These all arise in the United Kingdom.

Non-storage income derives principally from rental income earned from tenants of properties awaiting development.

Further analysis of the Group's operating revenue and costs can be found in the Portfolio Summary.

The seasonality of the business is discussed in note 18.

3. INVESTMENT INCOME

4. FINANCE COSTS

5. TAX

There is no tax charge in the residual business in the period due to the utilisation of brought forward tax losses and group relief.

6. ADJUSTED PROFIT BEFORE TAX

Adjusted profit before tax which excludes the revaluation of investment properties, changes in fair value of interest rate derivatives, net gains and losses on surplus land, and any non-recurring items of income and expenditure, has been disclosed to give a clearer understanding of the Group's underlying trading performance.

7. DIVIDENDS

The proposed interim dividend of 10.4 pence per ordinary share will be paid on 8 January 2015 to shareholders on the Register on 12 December 2014. The interim dividend is all Property Income Dividend.

8. EARNINGS PER ORDINARY SHARE

The European Public Real Estate Association ("EPRA") has issued recommended bases for the calculation of certain per share information and these are included in the following table.

The calculation of basic earnings is based on profit after tax for the period. The weighted average number of shares used to calculate diluted earnings per share has been adjusted for the conversion of potentially dilutive share options.

EPRA earnings per ordinary share before the revaluation of investment properties, gains and losses on surplus land, the change in fair value of interest rate derivatives, one-off items of expenditure, and the Group's share of its associates' derivative and revaluation movements has been disclosed to give a clearer understanding of the Group's underlying trading performance.

9. NON-CURRENT ASSETS

a) Investment property