Last checked at 21 Feb 2017 07:00
21 February 2017
Safestore Holdings plc ("the Group")
First quarter trading update for the period 1 November 2016 to 31 January 2017
Good trading momentum through the first quarter
Group Operating Performance- like-for-like3 | Q1 2017 | Q1 20162 | Change | Change- CER1 |
Revenue (£'m) | 29.2 | 26.7 | 9.4% | 4.7% |
Closing Occupancy (let sq ft- million) 4 | 3.49 | 3.41 | 2.3% | n/a |
Closing Occupancy (% of MLA) 5 | 71.2% | 69.8% | +1.4ppts | n/a |
Average Storage Rate (£) | 27.64 | 25.73 | 7.4% | 2.7% |
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Group Operating Performance- total | Q1 2017 | Q1 20162 | Change | Change- CER1 |
Revenue (£'m) | 31.8 | 27.0 | 17.8% | 13.3% |
Closing Occupancy (let sq ft- million) 4 | 3.87 | 3.43 | 12.8% | n/a |
Closing Occupancy (% of MLA) 5 | 68.6% | 69.7% | (1.1ppts) | n/a |
Average Storage Rate (£) | 27.02 | 25.69 | 5.2% | 0.9% |
Highlights
· First quarter Group total revenue in CER1 up 13.3% with like-for-like revenue in CER up 4.7%
· UK total revenue up 15.9% bolstered by the recent four new store openings and the Space Maker acquisition
· UK like-for-like revenue up 4.9%
· Paris revenue in CER1 up 4.6%
Frederic Vecchioli, Chief Executive Officer commented:
"Trading momentum across the estate in the first quarter has been good against the strong comparative period in 2016, with enquiries and new lets at higher levels than in previous years. As a result, our revenue performance is tracking well and in line with our guidance for both the UK and Paris.
We remain confident that the positive market dynamics, company fundamentals and trading momentum will allow us to deliver earnings in line with the Board's expectations for the current financial year."
Business highlights
UK Trading Performance
UK Operating Performance- like-for-like3 | Q1 2017 | Q1 20162 | Change |
Revenue (£'m) | 21.4 | 20.4 | 4.9% |
Closing Occupancy (let sq ft- million) 4 | 2.69 | 2.62 | 2.7% |
Closing Occupancy (% of MLA) 5 | 69.1% | 67.5% | +1.6ppts |
Average Storage Rate (£) | 25.35 | 24.81 | 2.2% |
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UK Operating Performance- total | Q1 2017 | Q1 20162 | Change |
Revenue (£'m) | 24.0 | 20.7 | 15.9% |
Closing Occupancy (let sq ft- million) 4 | 3.06 | 2.64 | 15.9% |
Closing Occupancy (% of MLA) 5 | 67.0% | 67.4% | (0.4ppts) |
Average Storage Rate (£) | 24.87 | 24.77 | 0.4% |
UK grew like-for-like revenue by 4.9% in the first quarter driven by a 2.7% increase in occupancy and a 2.2% increase in rate and saw record new lets for the period. Reflecting expected seasonal industry trading patterns, the business experienced net vacates in the first quarter. However, the occupancy reduction of 106,000 sq ft was lower than in the prior year (Q1 2016; 114,000 sq ft). As a result, the like-for-like closing occupancy level was 1.6ppts higher than the prior year at 69.1% (Q1 2016: 67.5%).
The addition of Space Maker at the end of July 2016 and the opening of four new stores between August and November 2016 resulted in total revenue increasing by 15.9%. However, the impact of the initial months of trading of the new stores is to dilute the total closing occupancy and the average rate, as the new stores have initially low occupancies and a high proportion of the customer base is benefiting from introductory discounts. Notwithstanding the short term dilutive impact, the new openings have traded in line with our expectations.
Paris Trading Performance
Paris Operating Performance- like-for-like3 | Q1 2017 | Q1 20162 | Change |
Revenue (€'m) | 9.1 | 8.7 | 4.6% |
Closing Occupancy (let sq ft- million) 4 | 0.80 | 0.79 | 1.3% |
Closing Occupancy (% of MLA) 5 | 79.1% | 78.6% | +0.5ppts |
Average Storage Rate (€) | 41.12 | 39.36 | 4.5% |
Revenue (£'m) | 7.8 | 6.3 | 23.8% |
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Paris Operating Performance- total | Q1 2017 | Q1 20162 | Change |
Revenue (€'m) | 9.1 | 8.7 | 4.6% |
Closing Occupancy (let sq ft- million) 4 | 0.81 | 0.79 | 2.5% |
Closing Occupancy (% of MLA) 5 | 75.4% | 78.6% | (3.2ppts) |
Average Storage Rate (€) | 40.95 | 39.36 | 4.0% |
Revenue (£'m) | 7.8 | 6.3 | 23.8% |
Our Paris performance was again robust in the first quarter. Similarly to the UK, the business saw record new lets for a first quarter. Like-for-like revenue growth for the quarter was 4.6% on a constant currency basis, with occupancy up 1.3% and rate up 4.5% year-on-year. The impact of a 15% strengthening of the Euro relative to Sterling has resulted in a 23.8% year-on-year increase in Sterling revenue in the quarter.
As in the UK, the business experienced expected seasonal net vacates in the first quarter. However, consistent with the UK, the occupancy reduction of 16,000 sq ft was lower than in the prior year (Q1 2016: 32,000 sq ft). As a result, the like-for-like closing occupancy level was 0.5ppts higher than the prior year at 79.1% (Q1 2016: 78.6%).
As expected, the opening of our new 60,000 sq ft Emerainville store in October 2016 diluted the Q1 total closing occupancy, which was 75.4% (Q1 2016: 78.6%), and the total average rate, which was up 4.0%.
Our strategy of achieving an appropriate balance of rate and occupancy growth, together with our leading position in the heart of the demographically attractive Parisian market, has continued to deliver year-on-year progress.
Ends
1 - CER is Constant Exchange Rate.
2 - Q1 2016 is the quarter ended 31 January 2016.
3 - Like-for-like adjustments have been made to remove the impact of the 2016 openings of Wandsworth, Altrincham, Birmingham (including closure of our existing Birmingham store), Chiswick and Emerainville. In addition, the impact of the acquisition of Space Maker on 29 July 2016 has been adjusted.
4 - Closing occupancy excludes offices but includes 36,750 sq ft of bulk tenancy as at 31 January 2017 (31 January 2016: 52,750 sq ft).
5 - MLA is Maximum Lettable Area. Group MLA has been adjusted to 5.64m sq ft (2016: 4.93m) following the acquisition of Space Maker and the openings of Wandsworth, Altrincham, Birmingham, Chiswick and Emerainville.
Enquiries
Safestore Holdings plc | 020 8732 1500 |
Frederic Vecchioli, Chief Executive Officer |
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Andy Jones, Chief Financial Officer |
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www.safestore.com |
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Instinctif Partners | 020 7457 2020 |
Mark Reed Guy Scarborough |
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Notes to editors:
· Safestore is the UK's largest self-storage group with 134 stores, comprising 109 wholly owned stores in the UK (including 63 in London and the South East with the remainder in key metropolitan areas such as Manchester, Birmingham, Glasgow, Edinburgh, Liverpool and Bristol) and 25 wholly owned stores in the Paris region.
· 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 provides storage to around 55,000 personal and business customers.
· Safestore has a maximum lettable area ("MLA") of 5.64 million sq ft (excluding pipeline stores) of which 3.87 million sq ft is currently occupied.
· Safestore employs around 600 people in the UK and France.