TIDMSAFE
RNS Number : 8105U
Safestore Holdings plc
28 November 2023
28 November 2023
Safestore Holdings plc
Fourth quarter trading update for the period 1 August 2023 to 31
October 2023
A year of significant strategic progress
Key Measures - Q4 Q4 Change Change YTD YTD Change Change
Total 2023 2022 CER(1) 2023 2022 CER(1)
-------------------------- ------ ------ ------- -------- ------ ------ ------- --------
Group
Revenue (GBP'm) 57.6 56.8 1.4% 1.4% 224.2 212.5 5.5% 4.8%
Closing Occupancy
(let sq ft- million)(3) 6.231 6.317 -1.4% n/a 6.231 6.317 -1.4% n/a
Closing Occupancy
(% of MLA) 77.0% 82.1% -5.1% n/a 77.0% 82.1% -5.1% n/a
Maximum Lettable
Area (MLA) 8.09 7.70 5.1% n/a 8.09 7.70 5.1% n/a
Average Storage
Rate (GBP) 30.22 29.64 2.0% 2.0% 30.26 29.25 3.5% 2.7%
REVPAF (GBP)(9) 28.24 29.25 -3.5% -3.4% 27.70 27.59 0.4% -0.2%
-------------------------- ------ ------ ------- -------- ------ ------ ------- --------
Key Measures - Q4 Q4 Change Change YTD YTD Change Change
Like-For-Like(5) 2023 2022 CER 2023 2022 CER
(1) (1)
----------------------- ------ ------ ------- ------- ------ ------ ------- -------
Group
Revenue (GBP'm) 53.7 53.9 -0.4% -0.4% 209.9 205.3 2.2% 1.7%
Closing Occupancy
(let sq ft- million)
(3) 5.583 5.793 -3.6% n/a 5.583 5.793 -3.6% n/a
Closing Occupancy
(% of MLA) 79.6% 82.8% -3.2% n/a 79.6% 82.8% -3.2% n/a
Average Occupancy
(let sq ft- million) 5.638 5.852 -3.7% n/a 5.586 5.779 -3.3% n/a
Maximum Lettable
Area (MLA) 7.02 7.00 0.3% n/a 7.02 7.00 0.3% n/a
Average Storage
Rate (GBP) 31.57 30.72 2.8% 2.8% 31.57 29.89 5.6% 5.0%
REVPAF (GBP) (9) 30.37 30.55 -0.6% -0.6% 29.91 29.34 1.9% 1.4%
----------------------- ------ ------ ------- ------- ------ ------ ------- -------
Highlights
-- Group revenue for the year in CER(1) was up 4.8% and 5.5% at actual exchange rates
-- Like-for-like(5) Group revenue for the year in CER(1) up 1.7%
-- Like-for-like (5) average rate for the year up 5.0% in CER(1)
-- Like-for-like(5) closing occupancy at 79.6% (2022: 82.8%)
-- Openings of four new stores and one extension since Q3 adding 150,100 sq ft of MLA
-- Two new pipeline sites/extensions in the quarter increased the pipeline by 100,000 sq ft.
-- Group Property Pipeline of 1.5m sq ft representing c. 18% of
the existing portfolio to be funded from existing financial
resources and expected to generate GBP25-GBP30m of stabilised
EBITDA.
Frederic Vecchioli, Chief Executive Officer, commented:
"After two years of out-performance in which the Group delivered
total like-for-like (5) revenue growth of c. 25%, 2023 has been a
resilient year in which significant strategic and operational
progress has been made.
In the year, at CER (1) , the Group's industry leading REVPAF
(9) grew by 1.4% on a like-for-like (5) basis with like-for-like
(5) revenue up 1.7%. Total Group revenue grew by 4.8% reflecting
recently added new stores and the annualisation effect of our
acquisition of the Benelux business.
We believe that the COVID period has acted as an accelerator of
growth for the self-storage industry. Whilst demand stabilised
during the year at a level that is below 2022, we are still seeing
enquiry levels that are ahead of the pre-COVID period.
We have made significant strategic progress during the year
having opened, acquired, or extended thirteen stores (five in the
UK, six in Spain and two in Netherlands) adding over 500,000 sq ft
of MLA to the portfolio. In addition, a pipeline of a further 1.5m
sq ft across 30 projects has been established which represents 18%
of the existing MLA of the business. A joint venture with Carlyle
was established earlier in the year, which facilitated the Group's
entry into the under-penetrated German market. In addition, the
integration of our Benelux business, acquired in 2022, is now
complete.
Looking beyond any potential short-term volatility, there
remains a significant under-supply of high quality self-storage
capacity across the UK and Europe which provides a structural
growth driver for the industry. New locations feed awareness which
subsequently drives demand. Safestore's industry leading business
model remains unchanged and we have substantial growth to deliver
both from filling the 1.8m square feet of fully invested, currently
unlet space, and from the new sites in our pipeline, across major
cities in the UK and continental Europe. Safestore has a proven
track record, and the returns we deliver are significantly ahead of
our cost of debt, so we look to the future with confidence.
For 2023, we anticipate that the business will deliver Adjusted
Diluted EPRA Earnings per Share (7) in line with the guidance given
in our third quarter trading statement (8) ."
Trading Performance
Trading Data- Total
Key Measures - Total Q4 2023 Q4 2022 Change YTD YTD Change
2023 2022
----------------------- -------- -------- ------- ------ ------ -------
Revenue
UK (GBP'm) 42.7 42.8 -0.2% 166.5 163.0 2.1%
Paris (EUR'm) 13.0 12.6 3.2% 50.5 48.8 3.5%
Spain (EUR'm) 1.3 0.9 44.4% 4.3 3.6 19.4%
Netherlands (EUR'm) 1.9 1.6 18.8% 7.2 3.6 100.0%
Belgium (EUR'm) 1.1 1.0 10.0% 4.1 2.3 78.3%
----------------------- -------- -------- ------- ------ ------ -------
Average Rate
UK (GBP) 30.26 29.58 2.3% 30.25 28.79 5.1%
Paris (EUR) 42.28 40.93 3.3% 42.05 40.47 3.9%
Spain (EUR) 32.15 34.88 -7.8% 33.12 34.07 -2.8%
Netherlands (EUR) 18.66 19.06 -2.1% 18.61 19.18 -3.0%
Belgium (EUR) 22.56 19.54 15.5% 21.45 18.79 14.2%
----------------------- -------- -------- ------- ------ ------ -------
REVPAF(9)
UK (GBP) 29.58 30.22 -2.1% 29.07 29.02 0.2%
Paris (EUR) 37.84 36.79 2.9% 37.10 35.81 3.6%
Spain (EUR) 14.72 31.49 -53.3% 12.64 29.78 -57.6%
Netherlands (EUR) 17.29 16.67 3.7% 16.53 16.20 2.0%
Belgium (EUR) 19.54 18.06 8.2% 18.68 17.43 7.2%
----------------------- -------- -------- ------- ------ ------ -------
Closing Occupancy
(3)
UK (million) 4.473 4.637 -3.5%
Paris (million) 1.107 1.112 -0.4%
Spain (million) 0.135 0.095 42.1%
Netherlands (million) 0.352 0.298 18.1%
Belgium (million) 0.164 0.175 -6.3%
----------------------- -------- -------- ------- ------ ------ -------
Closing Occupancy
(% of MLA)
UK (million) 78.1% 82.6% -4.5%
Paris (million) 81.3% 81.7% -0.4%
Spain (million) 39.5% 78.9% -39.4%
Netherlands (million) 80.7% 78.8% 1.9%
Belgium (million) 74.1% 78.8% -4.7%
----------------------- -------- -------- ------- ------ ------ -------
Maximum Lettable
Area (MLA)
UK (million) 5.730 5.620 2.0%
Paris (million) 1.360 1.360 -
Spain (million) 0.340 0.120 183.3%
Netherlands (million) 0.440 0.380 15.8%
Belgium (million) 0.220 0.220 -
----------------------- -------- -------- ------- ------ ------ -------
Trading Data- Like-For-Like(5)
Key Measures - Like-For-Like(5) Q4 2023 Q4 2022 Change YTD YTD Change
2023 2022
--------------------------------- -------- -------- ------- ------ ------ -------
Revenue
UK (GBP'm) 41.7 42.2 -1.2% 162.8 160.9 1.2%
Paris (EUR) 13.0 12.6 3.2% 50.5 48.8 3.5%
Spain (EUR) 0.9 0.9 - 3.6 3.6 -
Average Rate
UK (GBP) 30.33 29.62 2.4% 30.31 28.83 5.1%
Paris (EUR) 42.28 40.93 3.3% 42.05 40.47 3.9%
Spain (EUR) 37.14 35.02 6.1% 36.64 34.11 7.4%
REVPAF(9)
UK (GBP) 29.84 30.26 -1.4% 29.35 29.10 0.9%
Paris (EUR) 37.84 36.79 2.9% 37.10 35.81 3.6%
Spain (EUR) 33.80 34.48 -2.0% 33.33 33.05 0.8%
Average Occupancy
UK (million) 4.434 4.635 -4.3% 4.396 4.582 -4.1%
Paris (million) 1.117 1.122 -0.4% 1.103 1.103 -
Spain (million) 0.087 0.095 -8.4% 0.087 0.094 -7.4%
Closing Occupancy
(3)
UK (million) 4.392 4.587 -4.3%
Paris (million) 1.107 1.112 -0.4%
Spain (million) 0.084 0.093 -9.7%
Closing Occupancy
(% of MLA)
UK 79.2% 83.0% -3.8%
Paris 81.3% 81.7% -0.4%
Spain 77.9% 85.9% -8.0%
Maximum Lettable
Area (MLA)
UK (million) 5.550 5.530 0.4%
Paris (million) 1.360 1.360 -
Spain (million) 0.110 0.110 -
--------------------------------- -------- -------- ------- ------ ------ -------
Details of trading operating KPI's are included in the tables
above.
UK
UK revenue was up 2.1% for the year in total and 1.2% on a
like-for-like(5) basis.
In the fourth quarter like-for-like(5) revenue was stable across
the period and finished the quarter at 1.2% below the prior
year.
Demand, measured by enquiry levels, was down on the previous
year but ahead of pre-COVID levels.
In the business customer segment we saw a small improvement in
our customer numbers compared to the third quarter. In the fourth
quarter we saw a 25,000 sq ft inflow in business occupancy compared
to a 2,000 sq ft inflow in the same period last year.
We believe that our REVPAF(9) , a measure of how effectively we
yield manage our assets, is the strongest in the industry.
REVPAF(9) grew by 0.9% for the year on a like-for-like(5)
basis.
Paris
Our Paris business did not experience the same surge in demand
that we saw in the UK during the COVID period but continued to grow
steadily.
Paris revenue grew 3.5% in total for the year on a total and
like-for-like (5) basis. Like-for-like (5) revenue growth in the
fourth quarter was 3.2%.
Our REVPAF (9) , which we believe is significantly ahead of the
local competition, grew by a further 3.6% for the year.
Enquiry levels in Paris were marginally down compared to the
same period last year but ahead of pre-COVID levels.
Spain
Since acquiring our Spanish business in 2019 we have opened a
further seven stores. We now have eleven open stores and a pipeline
of a further five stores.
Over the year our Spanish business grew revenue by 19.4% and by
44.4% in the fourth quarter. Like-for-like (5) revenue was flat in
the quarter and across the year.
In line with our expectations, like-for-like (5) occupancy in
Barcelona has initially been diluted by the new Barcelona stores
which have opened in close proximity and within the same catchment
area as an existing store. Management believes that, given the
limited supply in central Barcelona, once the absorption phase has
been passed, the stores will generate higher revenue and profits
and provide significant long-term value.
Netherlands
Our Netherlands business, acquired on 30 March 2022, contributed
EUR1.9m revenue in the quarter and EUR7.2m for the year.
During the year, a new store in Amersfoort has opened and an
additional store in Apeldoorn was acquired. We now have eleven
stores open in the Netherlands and a pipeline of a further four
sites.
The Netherlands business is not treated as like-for-like (5)
during the 2023 financial year. However, the stores that were in
the Group for the whole of the fourth quarter in 2022 delivered
10.7% growth in Q4 2023.
Belgium
Our Belgium business, acquired with our Netherlands business on
30 March 2022, contributed EUR1.1m revenue in the quarter and
EUR4.1m for the year.
We have six stores open in Belgium and a pipeline of one
additional site.
The Belgian business is not treated as like-for-like(5) during
the 2023 financial year. However, the stores that were in the Group
for the whole of the fourth quarter in 2022 delivered 10.0% growth
in Q4 2023.
Property Pipeline Developments
Openings of New Stores and Extensions in the period
Open 2023 FH/LH MLA Other
------------------------ ------ ------- -----------
Redevelopments and Extensions
------------------------------------------------------
London- Paddington LH 8,400 Extension
Marble Arch
New Developments
------------------------------------------------------
Ellesmere Port FH 55,000 New build
Central Barcelona 3 LH 14,700 Conversion
Amersfoort- Netherlands FH 58,000 New build
Open 2023 (post-year FH/LH MLA Other
end)
--------------------- ------------------ ------- ----------------------
New Developments
--------------------------------------------------------------------------
Eastleigh LH 14,000 Conversion, Satellite
The extension of our London- Paddington March Arch store, two
new freehold stores in Ellesmere Port and Amersfoort, Netherlands
and one new leasehold site in Central Barcelona were opened in the
period adding 136,100 sq ft of MLA. The new satellite conversion at
Eastleigh was also open post year-end, adding a further 14,000 sq
ft of MLA.
New Development Projects added in the Period
We have added two development sites to the pipeline in the
period.
Paris West 4 is a freehold site with planning permission where
we will build a new build 53,000 sq ft store, opening in 2024.
In Belgium, we have exchanged contracts on a freehold site in
the Brussels conurbation at Melsbroek. We plan to open a 47,400 sq
ft new build store in 2025.
Pipeline Summary
We are leveraging our effective and scalable operating platform
to increase our expansion plans across both the UK and continental
Europe. This approach has resulted in the largest development
pipeline in our history which will be funded from our existing
financial resources. This pipeline of c. 1.5m sq ft represents c.
18% of our existing property portfolio. The pipeline and associated
financing is dilutive to earnings in the near term but, as the
stores mature, we are confident, based on our track record, that
reliable, secure and significant earnings and value accretion will
be achieved. We estimate that, on stabilisation, the current
pipeline will deliver in the range of GBP25-GBP30m of incremental
EBITDA.
Opening 2024 FH/LH Status* MLA Other
------------------------- ------- -------- ------- ----------------------
Redevelopments and Extensions
-----------------------------------------------------------------------------
London- Holloway FH C, STP 9,500 Extension
Paris- Poissy FH C, UC 12,000 Extension
Paris- Pyrenees LH C, UC 22,200 Extension
New Developments
-----------------------------------------------------------------------------
London- Paddington FH C, UC 13,000 Conversion, Satellite
Park West
London- Lea Bridge FH C, UC 76,500 New build
Eastleigh ** LH C, UC 14,000 Conversion, Satellite
**
Paris- South Paris FH C, UC 55,000 New build
Paris- West 3 FH C, UC 58,000 New build
Paris- East 1 FH C, PG 60,000 Conversion
Paris- North West 1 FH C, PG 54,000 Conversion
Paris- West 4 FH CE, PG 53,000 New Build
South West Madrid FH C, UC 46,800 Conversion
Southern Madrid 2 FH C, UC 68,800 Conversion
Central Barcelona 2 LH C, PG 20,400 Conversion
North East Madrid FH C, STP 66,000 Conversion
Almere- Netherlands FH C, UC 44,500 Conversion
Aalsmeer- Netherlands FH C, UC 48,400 New build
Rotterdam- Netherlands FH C, UC 71,000 New build
Opening 2025
-----------------------------------------------------------------------------
New Developments
-----------------------------------------------------------------------------
London- Woodford FH C, PG 76,000 New build
London- Walton FH C, PG 20,700 Conversion
London- Watford FH CE, STP 46,750 New build
London- Wembley FH C, STP 49,000 New build
Paris- West 1 FH C, PG 56,000 New build
Paris- La Défense FH C, UC 44,000 Mixed use facility
Pamplona FH C, PG 71,000 Conversion
Amsterdam- Netherlands FH CE, STP 61,400 New build
Melsbroek- Belgium FH CE, PG 47,400 New build
Opening Beyond 2025
-----------------------------------------------------------------------------
New Developments
-----------------------------------------------------------------------------
London- Old Kent Road FH C, STP 76,500 New build
London- Bermondsey FH C, STP 50,000 New build
London- Romford FH C, STP 41,000 New build
Shoreham FH CE, STP 54,000 New build
Total Pipeline MLA (let sq ft- million) c. 1.487
-------------------------------------------- -------------------------------
Total Outstanding CAPEX (GBP'm) c. 128.0
-------------------------------------------- -------------------------------
*C = completed, CE = contracts exchanged, STP = subject to
planning, PG = planning granted, UC = under construction
** Open post-year end
Ends
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 - Q4 2022 is the quarter ended 31 October 2022.
3 - Occupancy excludes offices but includes bulk tenancy. As of
31 October 2023, closing occupancy includes 18,000 sq ft of bulk
tenancy (31 October 2022: 24,000 sq ft).
4 - MLA is Maximum Lettable Area.
5 - 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.
6 - The Spain business was acquired on 30 December 2019 with the
four originally acquired stores now considered like-for-like.
7- Adjusted Diluted EPRA EPS is based on the European Public
Real Estate Association's definition of Earnings and is defined as
profit or loss for the period after tax but excluding corporate
transaction costs, change in fair value of derivatives, gain/loss
on investment properties and the associated tax impacts. The
Company then makes further adjustments for the impact of
exceptional items, IFRS 2 share-based payment charges, exceptional
tax items and deferred tax charges. This adjusted earnings is
divided by the diluted number of shares. The IFRS 2 cost is
excluded as it is written back to distributable reserves and is a
non-cash item (with the exception of the associated National
Insurance element). Therefore, neither the Company's ability to
distribute nor pay dividends are impacted (with the exception of
the associated National Insurance element). The financial
statements will disclose earnings on a statutory, EPRA and Adjusted
Diluted EPRA basis and will provide a full reconciliation of the
differences in the financial year in which any LTIP awards may
vest.
8 - The analyst consensus for Adjusted Diluted EPRA EPS for the
current financial year, based on the forecasts of fifteen analysts,
is 48.0p. The fifteen analyst forecasts range from 47.3p to 50.0p.
In our third quarter trading statement we guided towards the lower
end of the range of analysts' forecasts for 2023. This guidance
remains in place for our fourth quarter.
9 - REVPAF is an alternative performance measure used by the
business. REVPAF stands for Revenue per Available Square Foot and
is calculated by dividing revenue for the period by weighted
average available square feet for the same period.
10 - Where reported amounts are presented either to the nearest
GBP0.1m or to the nearest 10,000 sq ft, the effect of rounding may
impact the reported percentage change.
Enquiries
Safestore Holdings PLC
Frederic Vecchioli, Chief Executive via Instinctif Partners
Officer
Andy Jones, Chief Financial
Officer
www.safestore.com
Instinctif Partners
Guy Scarborough/ Bryn Woodward 07917 178920 / 07739 342009
Notes to Editors
-- Safestore is the UK's largest self-storage group with 190
stores on 31 October 2023, comprising 133 wholly owned stores in
the UK (including 73 in London and the South East with the
remainder in key metropolitan areas such as Manchester, Birmingham,
Glasgow, Edinburgh, Liverpool, Sheffield, Leeds, Newcastle, and
Bristol), 29 wholly owned stores in the Paris region, 11 stores in
Spain, 11 stores in the Netherlands and 6 stores in Belgium. In
addition, the Group operates 7 stores in Germany under a Joint
Venture agreement with Carlyle.
-- 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 more densely populated 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 90,000 personal and business customers.
-- As of 31 October 2023, Safestore had a maximum lettable area
("MLA") of 8.090 million sq ft (excluding the expansion pipeline
stores) of which 6.231 million sq ft was occupied.
-- Safestore employs around 750 people in the UK, Paris, Spain, the Netherlands, and Belgium.
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END
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