TIDMSAFE
RNS Number : 6878Q
Safestore Holdings plc
14 September 2017
14 September 2017
Safestore Holdings plc
Third quarter trading update for the period 1 May 2017 to 31
July 2017
Strong revenue growth, Space Maker and new stores delivering,
Paris accelerating
Group Operating Performance Q3 Q3 2016(2) Change Change-
2017 CER(1)
------------------------------- ------ ----------- ---------- --------
Revenue (GBP'm) 32.9 28.6 15.0% 12.5%
------------------------------- ------ ----------- ---------- --------
Revenue (GBP'm)- year-to-date 95.5 82.7 15.5% 12.4%
------------------------------- ------ ----------- ---------- --------
Closing Occupancy (let
sq ft- million) (4) 4.20 3.69 13.8% n/a
------------------------------- ------ ----------- ---------- --------
Closing Occupancy (%
of MLA) (5) 73.1% 74.8% (1.7ppts) n/a
------------------------------- ------ ----------- ---------- --------
Average Storage Rate
(GBP) 26.06 25.87 0.7% (1.5%)
------------------------------- ------ ----------- ---------- --------
Average Storage Rate
(GBP)- year-to-date 26.58 25.97 2.3% (0.6%)
------------------------------- ------ ----------- ---------- --------
Group Operating Performance- Q3 Q3 2016(2) Change Change-
like-for-like(3) 2017 CER(1)
------------------------------- ------ ----------- --------- --------
Revenue (GBP'm) 29.9 28.4 5.3% 3.2%
------------------------------- ------ ----------- --------- --------
Revenue (GBP'm)- year-to-date 87.3 82.0 6.5% 3.5%
------------------------------- ------ ----------- --------- --------
Closing Occupancy (let
sq ft- million) (4) 3.72 3.67 1.4% n/a
------------------------------- ------ ----------- --------- --------
Closing Occupancy (%
of MLA) (5) 76.0% 74.8% +1.2ppts n/a
------------------------------- ------ ----------- --------- --------
Average Storage Rate
(GBP) 26.77 25.91 3.3% 0.8%
------------------------------- ------ ----------- --------- --------
Average Storage Rate
(GBP)- year-to-date 27.26 26.00 4.8% 1.5%
------------------------------- ------ ----------- --------- --------
Highlights
-- Group revenue in Q3 in CER(1) grew by 12.5%
-- Group like-for-like revenue in Q3 in CER(1) increased 3.2% with strong Paris performance
o UK up 2.3%
o Paris up 5.7%
-- Group like-for-like closing occupancy of 76.0% (up 1.2 ppts on Q3 2016)
-- Group like-for-like average storage rate in Q3 in CER(1) grew 0.8%
-- New store at Paddington Marble Arch expected to open in 2018
-- Sale of Deptford store for GBP4.8m
Frederic Vecchioli, Chief Executive Officer commented:
"I am pleased to report continuing positive trading across the
group in the third quarter with particularly strong momentum in our
Paris business. As ever, our top priority remains the significant
organic growth opportunity represented by the 1.5m square feet of
currently unlet space in our existing fully invested estate.
Our recent openings in London (Wandsworth and Chiswick), Paris
(Emerainville and Combs-la-Ville), Birmingham and Altrincham, are
all performing in line or ahead of their business plans as is Space
Maker, the twelve-store portfolio acquired in July 2016. I am also
pleased to announce our new store at Paddington Marble Arch and
look forward to its forthcoming opening along with our new store in
Mitcham in the next financial year.
I am confident that our leading market positions in the UK and
Paris will enable us to withstand any challenges presented by the
current uncertain macro-economic backdrop. The company is in a
strong position and remains on course to meet the Board's full year
expectations."
Business highlights
UK Trading Performance
UK Operating Performance Q3 Q3 2016(2) Change
2017
------------------------------- ------ ----------- ----------
Revenue (GBP'm) 24.7 21.5 14.9%
------------------------------- ------ ----------- ----------
Revenue (GBP'm)- year-to-date 72.0 62.6 15.0%
------------------------------- ------ ----------- ----------
Closing Occupancy (let
sq ft- million) (4) 3.32 2.86 16.1%
------------------------------- ------ ----------- ----------
Closing Occupancy (%
of MLA) (5) 72.5% 73.0% (0.5ppts)
------------------------------- ------ ----------- ----------
Average Storage Rate
(GBP) 23.82 24.29 (1.9%)
------------------------------- ------ ----------- ----------
Average Storage Rate
(GBP)- year-to-date 24.43 24.64 (0.9%)
------------------------------- ------ ----------- ----------
UK Operating Performance- Q3 Q3 2016(2) Change
like-for-like(3) 2017
------------------------------- ------ ----------- ---------
Revenue (GBP'm) 21.8 21.3 2.3%
------------------------------- ------ ----------- ---------
Revenue (GBP'm)- year-to-date 64.0 61.9 3.4%
------------------------------- ------ ----------- ---------
Closing Occupancy (let
sq ft- million) (4) 2.87 2.84 1.1%
------------------------------- ------ ----------- ---------
Closing Occupancy (%
of MLA) (5) 73.7% 73.0% +0.7ppts
------------------------------- ------ ----------- ---------
Average Storage Rate
(GBP) 24.33 24.32 =
------------------------------- ------ ----------- ---------
Average Storage Rate
(GBP)- year-to-date 24.95 24.68 1.1%
------------------------------- ------ ----------- ---------
The UK business grew revenue by 14.9% in the quarter with
like-for-like revenue growing by 2.3%. Whilst performance in London
was solid, our South East stores outside London and Regional UK
stores performed strongly.
We saw good enquiry growth in the quarter of 4.5%. The third
quarter is traditionally the busiest period in the year and the UK
business added 162,000 sq ft of like-for-like occupancy since the
end of Q2 (2016: 170,000 sq ft added). As a result, Q3
like-for-like closing occupancy, at 73.7%, increased by 0.7
percentage points compared to the prior year and by 4.2 percentage
points over the peak season as compared to the position at the end
of Q2.
When the impact of the 2016 acquisition of Space Maker, and the
opening of four new stores in the last twelve months is taken into
consideration, revenue grew by 14.9% in the quarter. These new
stores, in the initial period after opening, are dilutive to
occupancy and rate. However, all new stores and Space Maker are
trading in line or ahead of our business plans.
Paris Trading Performance
Paris Operating Performance Q3 Q3 2016(2) Change
2017
------------------------------- ------ ----------- ----------
Revenue (EUR'm) 9.4 8.8 6.8%
------------------------------- ------ ----------- ----------
Revenue (EUR'm)- year-to-date 27.3 26.1 4.6%
------------------------------- ------ ----------- ----------
Closing Occupancy (let
sq ft- million) (4) 0.88 0.83 6.0%
------------------------------- ------ ----------- ----------
Closing Occupancy (%
of MLA) (5) 75.3% 82.0% (6.7ppts)
------------------------------- ------ ----------- ----------
Average Storage Rate
(EUR) 39.45 38.84 1.6%
------------------------------- ------ ----------- ----------
Average Storage Rate
(EUR)- year-to-date 40.18 39.42 1.9%
------------------------------- ------ ----------- ----------
Revenue (GBP'm) 8.2 7.1 15.5%
------------------------------- ------ ----------- ----------
Revenue (GBP'm)- year-to-date 23.5 20.1 16.9%
------------------------------- ------ ----------- ----------
Paris Operating Performance- Q3 Q3 2016(2) Change
like-for-like(3) 2017
------------------------------- ------ ----------- ---------
Revenue (EUR'm) 9.3 8.8 5.7%
------------------------------- ------ ----------- ---------
Revenue (EUR'm)- year-to-date 27.1 26.1 3.8%
------------------------------- ------ ----------- ---------
Closing Occupancy (let
sq ft- million) (4) 0.85 0.83 2.4%
------------------------------- ------ ----------- ---------
Closing Occupancy (%
of MLA) (5) 84.7% 82.0% +2.7ppts
------------------------------- ------ ----------- ---------
Average Storage Rate
(EUR) 39.95 38.84 2.9%
------------------------------- ------ ----------- ---------
Average Storage Rate
(EUR)- year-to-date 40.50 39.42 2.7%
------------------------------- ------ ----------- ---------
Paris had a strong quarter growing revenue by 6.8% compared to
last year.
On a like-for-like basis the business grew both rate and
occupancy at or above the upper end of our guidance with revenue up
by 5.7% for the quarter.
Like-for-like occupancy grew by 39,000 sq ft since the end of Q2
(2016: 26,000 sq ft) resulting in closing occupancy of 84.7%, up
2.7 percentage points compared to the prior year and by 3.8
percentage points over the peak season as compared to the position
at the end of Q2.
Pricing showed improved momentum and our like-for-like average
rate was up 2.9% year-on-year in the quarter.
The impact of the new stores opened in the last twelve months at
Emerainville and Combs-la-Ville is to dilute rate and occupancy in
the initial period after trading commences. Both stores are trading
in line or ahead of our business plan.
The impact of the 8% weakening of Sterling compared to Q3 2016
contributed to the Sterling equivalent total revenue increasing
15.5% on the prior year.
New London Store
We are pleased to confirm that we obtained planning permission
and exchanged contracts in July 2017 for a new 37,000 sq ft
leasehold store located between Paddington and Marble Arch in
central London. The lease will be for a period of 20 years, with an
option to extend for a further 10 years. We anticipate that the
store will open in the second quarter of 2018.
Deptford(6)
In June 2017 we accepted an offer of GBP4.8m on our leasehold
Deptford store. The store contributed GBP0.4m of EBITDA after rent
in the year ended October 2016. The transaction was completed on 31
August 2017.
Lease Extension
Earlier this month we continued our programme of extending the
leases on our leasehold store portfolio. The lease on our Oldbury
store, which had 6 years remaining, has been extended to 2042
resulting in a certain term of 25 years. A year's rent free period
was agreed as part of the extension.
Outlook
Reflecting normal industry trading patterns, we anticipate a
reduction in occupancy in Q4 compared to Q3. Similar trading trends
have continued in the UK and Paris in the early part of Q4 and,
with the company in a strong position, we anticipate full year
earnings will be in line with the Board's expectations.
Ends
Notes
1 - CER is Constant Exchange Rates (Euro denominated results for
the current period have been retranslated at the exchange rate
effective for the comparative period, in order to present the
reported results on a more comparable basis).
2 - Q3 2016 is the quarter ended 31 July 2016.
3 - Like-for-like information includes only those stores which
have been open throughout both the current and prior financial
years, with adjustments made to remove the impact of new and closed
stores, as well as corporate transactions.
4 - Closing occupancy excludes offices but includes 36,250 sq ft
of bulk tenancy as at 31 July 2017 (31 July 2016 - 37,750 sq
ft).
5 - MLA is Maximum Lettable Area.
6 - Deptford has been reported within like-for-like trading for
these Q3 results to 31 July 2017, but will be excluded from
like-for-like in our full year results.
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
Matthew Smallwood
Mark Reed
Notes to editors:
* Safestore is the UK's largest self-storage group with
134 stores, comprising 108 wholly owned stores in the
UK (including 62 in London and the South East with
the remainder in key metropolitan areas such as
Manchester, Birmingham, Glasgow, Edinburgh, Liverpool
and Bristol) and 26 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.
* As at 31 July 2017, Safestore had a maximum lettable
area ("MLA") of 5.742 million sq ft (excluding the
expansion pipeline stores) of which 4.196 million sq
ft was occupied.
* Safestore employs around 600 people in the UK and
France.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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