REG - Safestore Hldgs plc - Third quarter trading update
05/09/2024 07:00
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RNS Number : 9684C Safestore Holdings plc 05 September 2024
5 September 2024
Safestore Holdings plc
Third quarter trading update for the period 1 May 2024 to 31 July 2024
Improving UK trading together with strong European revenue growth
Key Measures - Total Q3 2024 Q3 2023 Change Change Q3 YTD 2024 Q3 YTD 2023 Change Change
CER(1) CER(1)
Group
Revenue (£'m) 56.3 56.5 (0.4%) 0.0% 165.5 166.6 (0.7%) (0.2%)
Closing Occupancy (let sq ft- m)(2) 6.448 6.389 0.9%
Closing Occupancy (% of MLA)(2) 75.7% 79.1% (3.4ppt)
Maximum Lettable Area (MLA)(3) 8.520 8.080 5.4%
Average Storage Rate (£) 29.44 29.68 (0.8%) (0.3%) 29.92 30.27 (1.2%) (0.6%)
REVPAF (£)(6) 26.47 27.94 (5.3%) (4.8%) 26.65 27.56 (3.3%) (2.8%)
Key Measures - Like-For-Like(4) Q3 2024 Q3 2023 Change Change Q3 YTD 2024 Q3 YTD 2023 Change Change
CER(1) CER(1)
Group
Revenue (£'m) 55.0 55.1 (0.2%) 0.0% 162.0 163.0 (0.6%) (0.2%)
Closing Occupancy (let sq ft- m)(2) 6.209 6.291 (1.3%)
Closing Occupancy (% of MLA)(2) 80.3% 81.5% (1.2ppt)
Average Occupancy (let sq ft- million) 6.127 6.183 (0.9%) 6.015 6.098 (1.4%)
Maximum Lettable Area (MLA)(3) 7.730 7.720 0.6%
Average Storage Rate (£) 29.95 29.95 0.0% 0.4% 30.35 30.45 (0.3%) 0.2%
REVPAF (£)(6) 28.25 28.34 (0.3%) 0.1% 27.99 28.27 (1.0%) (0.5%)
Highlights
· Q3 2024 revenue at CER grew 1.1% year on year excluding £0.6m of
insurance premium tax relating to the sale of customer goods insurance in 2023
not repeated this year(7)
· Like-for-Like Group revenue for the quarter in CER was flat
· Like-for-Like Group closing occupancy(2) at 80.3% (Q3 2023:
81.5%)
· Like-for-Like average rate for the quarter up 0.4% year on year
in CER
· Openings of six new stores and extensions in the quarter, adding
297,000 sq ft of MLA with a development pipeline of 28 stores totalling 1.4m
sq ft representing 17% of the existing portfolio
· Significant UK domestic occupancy momentum in July and August
with Like-for-Like domestic occupied square feet now up 2.8% year-on year as
of end of August resulting in overall UK occupancy now flat on prior year
· Adjusted Diluted EPRA Earnings per Share for the full year
expected to be broadly in line with consensus forecasts(8)
Frederic Vecchioli, Chief Executive Officer, commented:
"We have delivered robust trading performance in the quarter, with improving
Like-for-Like revenue growth across the Group.
The UK has seen improving occupancy, continuing the trend from Q2, driven by
increasing levels of space taken by domestic customers. Since the end of the
quarter, this momentum has continued with domestic occupied space growing to
be 2.8% ahead of prior year at the end of August and with business customers
with stable levels of occupancy since the end of Q2.
Outside of the UK, Paris continues to deliver a steady level of growth with
the strong Like-for-Like growth in Spain, Netherlands and Belgium
demonstrating the exciting opportunity in these developing markets.
We have continued with the successful delivery of our development pipeline
with six stores and extensions opening in the quarter, adding nearly 300,000
sq ft to our portfolio. The pipeline includes two further stores and two
extensions scheduled to open this financial year with 24 further stores
opening in 2025 and beyond, which are projected to continue to drive earnings
growth in the medium term.
With UK revenue stabilising and with continued growth in Europe we expect
Adjusted Diluted EPRA Earnings per Share for the full year to be broadly in
line with consensus forecasts".
Trading Performance
Trading Data- Total
Q3 2024 Q3 2023 Change Q3 YTD 2024 Q3 YTD 2023 Change
Revenue (millions)
Group (£) 56.3 56.5 (0.4%) 165.5 166.6 (0.7%)
UK (£) 41.0 42.1 (2.6%) 120.7 123.8 (2.5%)
Paris (€) 12.9 12.7 1.6% 38.1 37.5 1.4%
Spain (€) 1.7 1.1 51.6% 4.5 3.1 47.7%
Netherlands (€) 2.2 1.8 17.3% 6.2 5.3 16.6%
Belgium (€) 1.3 1.0 20.6% 3.5 3.0 16.3%
Average Rate (per sq ft)
Group (£) 29.44 29.68 (0.8%) 29.92 30.27 (1.2%)
UK (£) 29.48 29.73 (0.8%) 30.05 30.24 (0.6%)
Paris (€) 42.40 41.87 1.3% 41.99 41.97 0.0%
Spain (€) 27.83 30.43 (8.5%) 29.05 33.51 (13.3%)
Netherlands (€) 20.08 17.92 12.1% 19.85 18.59 6.8%
Belgium (€) 23.89 21.65 10.3% 23.70 21.08 12.4%
REVPAF (per sq ft)(6)
Group (£) 26.47 27.94 (5.3%) 26.65 27.56 (3.3%)
UK (£) 28.06 29.15 (3.7%) 27.81 28.89 (3.7%)
Paris (€) 37.26 37.07 0.5% 37.18 36.85 0.9%
Spain (€) 16.30 16.02 1.7% 16.53 12.45 32.8%
Netherlands (€) 13.57 16.74 (18.9%) 15.30 16.77 (8.8%)
Belgium (€) 22.63 18.71 21.0% 21.36 18.38 16.2%
Closing Occupancy (million sq ft)(2)
Group 6.448 6.389 0.9%
UK 4.580 4.611 (0.7%)
Paris 1.100 1.118 (1.6%)
Spain 0.209 0.133 57.1%
Netherlands 0.376 0.356 5.6%
Belgium 0.183 0.171 7.0%
Closing Occupancy (% of MLA)(2)
Group 75.7% 79.1% (3.4ppt)
UK 78.8% 80.5% (1.7ppt)
Paris 77.7% 82.1% (4.4ppt)
Spain 50.9% 40.3% 10.6ppt
Netherlands 57.3% 81.7% (24.4ppt)
Belgium 82.4% 77.1% 5.3ppt
Maximum Lettable Area (million sq ft)(3)
Group 8.520 8.080 5.4%
UK 5.810 5.730 1.4%
Paris 1.420 1.360 4.4%
Spain 0.410 0.330 24.2%
Netherlands 0.660 0.440 50.0%
Belgium 0.220 0.220 0.0%
Trading Data- Like-For-Like(4)
Q3 2024 Q3 2023 Change Q3 YTD 2024 Q3 YTD 2023 Change
Revenue (millions)
Group (CER(1)) 55.1 55.1 - 162.7 163.0 (0.2%)
UK (£) 40.4 40.9 (1.2%) 119.0 120.7 (1.4%)
Paris (€) 12.9 12.7 1.6% 38.1 37.5 1.4%
Spain (€) 1.0 0.9 5.9% 2.9 2.8 3.6%
Netherlands (€) 1.9 1.7 12.3% 5.7 5.0 12.9%
Belgium (€) 1.3 1.0 20.6% 3.5 3.0 16.3%
Average Rate (per sq ft)
Group (CER(1)) 30.08 29.95 0.4% 30.52 30.45 0.2%
UK (£) 29.64 29.77 (0.4%) 30.17 30.26 (0.3%)
Paris (€) 42.43 41.87 1.3% 42.00 41.97 0.1%
Spain (€) 35.07 34.79 0.8% 36.14 36.24 (0.3%)
Netherlands (€) 21.69 19.32 12.3% 21.32 19.61 8.7%
Belgium (€) 23.89 21.65 10.3% 23.70 21.08 12.4%
REVPAF (per sq ft)(6)
Group (CER(1)) 28.37 28.34 0.1% 28.14 28.27 (0.5%)
UK (£) 28.42 28.83 (1.4%) 28.14 28.69 (1.9%)
Paris (€) 37.75 37.07 1.8% 37.34 36.85 1.3%
Spain (€) 32.94 31.04 6.1% 32.38 31.29 3.5%
Netherlands (€) 20.47 18.18 12.6% 20.13 17.84 12.8%
Belgium (€) 22.63 18.71 20.9% 21.36 18.38 16.2%
Average Occupancy (million sq ft)
Group 6.127 6.183 (0.9%) 6.015 6.098 (1.4%)
UK 4.438 4.508 (1.6%) 4.333 4.436 (2.3%)
Paris 1.102 1.104 (0.2%) 1.105 1.098 0.6%
Spain 0.098 0.094 4.3% 0.094 0.092 2.2%
Netherlands 0.307 0.309 (0.6%) 0.309 0.302 2.3%
Belgium 0.182 0.168 8.3% 0.174 0.170 2.4%
Closing Occupancy (million sq ft)(2)
Group 6.209 6.291 (1.3%)
UK 4.517 4.595 (1.7%)
Paris 1.098 1.118 (1.8%)
Spain 0.100 0.097 3.1%
Netherlands 0.311 0.310 0.3%
Belgium 0.183 0.171 7.0%
Closing Occupancy (% of MLA)(2)
Group 80.3% 81.5% (1.2ppt)
UK 80.0% 81.5% (1.5ppt)
Paris 80.6% 82.1% (1.5ppt)
Spain 82.4% 79.9% 2.5ppt
Netherlands 82.2% 82.1% 0.1ppt
Belgium 82.4% 77.1% 5.3ppt
Maximum Lettable Area (million sq ft)(3)
Group 7.730 7.720 0.1%
UK 5.650 5.640 0.2%
Paris 1.360 1.360 -
Spain 0.120 0.120 -
Netherlands 0.380 0.380 -
Belgium 0.220 0.220 -
UK
Total UK revenue was down 2.6% for the quarter, and down 1.2% excluding the
impact of customer goods protection. On a Like-for-Like basis revenue declined
by 1.2% for the quarter and 1.4% YTD.
Like-for-Like revenue for the quarter reflects a stable average rate (down
0.4%) and average occupancy down 1.6% year on year. However, we see occupancy
continue to improve relative to the prior year with occupancy 1.7% behind
prior year at end the of Q3, a 130 bps improvement from the H1 close.
Since the quarter end the occupancy position has continued to progress with
Like-for-Like closing occupancy at the end of August 2024 flat compared with
the same point in 2023. The improvement in occupancy is principally coming
from domestic customers which have improved their levels of occupied space
from 1.5% behind prior year at the end of April to being 0.3% ahead of prior
year as at the end of Q3 and now 2.8% higher at the end of August. In
addition, business customer occupied space has stabilised as we have
progressed through the year with levels at the end of Q3 broadly in line with
H1 close.
Building on our programme over the last six years of reducing unit sizes in
the UK to support the increase in share of domestic customers, we have
accelerated the rate of conversion of large units to smaller ones, with 4% of
large units converted Q3 YTD.
Paris
Paris revenue grew 1.6% in the quarter on a both a Total and a Like-for-Like
basis.
Average occupancy for the quarter was virtually flat year on year (down 0.2%)
with revenue growth coming through an increase in average rate (up 1.3% year
on year) on a Like-for-Like basis.
Spain
At the end of Q3 2024 we have a total of 12 stores open in Spain following the
opening of a new site in Madrid, of which five are trading on a Like-for-Like
basis, and a development pipeline of a further four stores.
During the quarter the total revenue for our Spanish business grew by 51.6%,
delivered by 46.6% growth from new stores together with 5.9% Like-for-Like
growth.
Like-for-like revenue growth was driven by both growing average occupancy (up
4.3% year on year) and increasing average rate (up 0.8%), a strong performance
when allowing for a degree of cannibalisation from our new stores in
Barcelona.
Total closing occupancy increased from 40.3% to 50.9% as the new development
stores fill up.
Like-for-like REVPAF for the quarter was up 6.1% on prior year at €32.94 per
sq ft.
Netherlands
Our Netherlands business has 14 open stores at the end of Q3 2024 following
the opening of our stores in Rotterdam, Almere and Aalsmeer in the period. We
have a pipeline of two additional sites due to open in 2025.
Total revenue in the quarter, including the newly opening stores, increased by
17.3% driven by a 12.3% increase on a Like-for-Like basis. The strong
Like-for-Like revenue growth came from a combination of a small decline in
average occupancy (down 0.6%) more than offset by average rate growth of
12.3%. At the end of the quarter, Like-for-Like closing occupancy was
virtually flat with prior year (up 0.1%) at 82.2%.
Total closing occupancy declined year on year by 24.4 percentage points
reflecting the 220,000 sq ft of new MLA added to our business and is expected
to provide further revenue growth as the stores are filled.
Like-for-like REVPAF for the quarter was up 12.6% at €20.47 per sq ft.
Belgium
Our Belgium business has six open stores and a pipeline of one additional site
scheduled to open in 2025.
Quarterly revenue, on both a Total and a Like-for-Like basis, increased by
20.6% year on year. The strong performance was a result of both rapid rate
increases (up 10.3%) and an 8.3% increase in average occupancy. Closing
occupancy was up 5.3 percentage points year on year at 82.4%.
Like-for-like REVPAF for Belgium was up 21.0% at €22.63 per sq ft.
Property Pipeline Developments
Openings of New Stores and Extensions in the period
Opened Q3 2024 FH/LH MLA(3) Development Type
Redevelopments and Extensions
London- Holloway FH 9.5 Extension
New Developments
Madrid- South 2 FH 68.8 Conversion
Randstad- Aalsmeer FH 48.4 New build
Randstad- Almere FH 44.5 Conversion
Randstad- Rotterdam FH 71.0 New build
Paris- South Paris FH 55.0 New build
Total New Space Opened Q3 2024 297.2
During the quarter we opened one extension on an existing site and a further
five new developments. The new space is all located in the key cities of
London, Paris, Madrid and the Randstad in line with our strategic focus.
Pipeline Summary
Through our development programme, we are leveraging our effective and
scalable operating platform to increase our expansion plans across both the UK
and continental Europe. This pipeline of 1.4m sq ft represents 17% of our
existing property portfolio. The pipeline, together with the associated
financing, is expected to be dilutive to earnings in the near term but as the
stores mature we are confident, based on our track record, that reliable and
significant value accretion will be achieved in the medium term.
Opening 2024 FH/LH Status* MLA(3) Development Type
Redevelopments and Extensions
Paris- Poissy FH C, UC 25.0 Extension
Paris- Pyrenees LH C, UC 15.4 Extension
Total Redevelopments and Extensions Q4 2024 40.4
New Developments
London- Lea Bridge FH C, UC 80.9 New build
St Albans FH C, UC 56.0 New build
Total New Developments Q4 2024 136.9
Total Opening Q4 2024 177.3
Opening 2025
New Developments
London- Walton FH C, UC 20.7 Conversion
London- Watford FH CE, PG 57.5 New build
London- Wembley FH C, PG 55.0 New build
London- Woodford FH C, PG 68.7 New build
Paris- East 1 FH C, PG 60.0 Conversion
Paris- La Défense FH C, UC 44.0 Mixed use facility
Paris- North West 1 FH C, PG 54.0 Conversion
Paris- West 1 FH C, PG 56.0 New build
Paris- West 3 FH C, UC 58.0 New Build
Paris- West 4 FH CE, PG 53.0 New Build
Barcelona- Central 2 LH C, UC 20.4 Conversion
Madrid- North East FH C, UC 57.0 Conversion
Madrid- South West FH C, UC 45.4 Conversion
Pamplona FH C, PG 60.7 Conversion
Randstad- Utrecht FH C, UC 50.0 Conversion
Randstad- Amsterdam FH C, UC 65.4 New build
Brussels- Zaventem FH C, UC 47.4 New build
Total New Developments 2025 873.2
Opening Beyond 2025
New Developments
Hemel Hempstead FH CE, STP 51.3 New build
London- Bermondsey FH C, STP 50.0 New build
London- Kingston FH CE, STP 55.0 New build
London- Old Kent Road FH C, STP 75.6 New build
London- Romford FH C, PG 41.0 New build
Shoreham FH CE, PG 47.0 New build
Welwyn Garden City FH CE, STP 51.0 New build
Total New Developments Beyond 2025 370.9
Total Pipeline 1,421.4
*C = completed, CE = contracts exchanged, STP = subject to planning, PG =
planning granted, UC = under construction
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 - Occupancy excludes offices but includes bulk tenancy. As of 31 July 2024,
closing occupancy includes 18,000 sq ft of bulk tenancy (31 July 2023: 18,000
sq ft).
3 - MLA is Maximum Lettable Area.
4 - 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.
5 - The Belgium and Netherlands businesses were acquired in March 2022 with
the 15 stores now considered like-for-like.
6 - 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. It is stated on an annual equivalent basis.
7 - Store Protect replaced our customer goods insurance programme in the UK
from 1 November 2023, attracting VAT rather than Insurance Premium Tax
('IPT'). The Q3 2023 YTD revenue includes £1.7 million representing 12% IPT
on insurance sales for the nine months. Excluding this impact, total revenue
increased 0.4% year on year for the Group and decreased 1.1% for the UK. The
IPT in 2023 has been excluded from Like-for-Like figures to aid comparability.
8 - Company compiled consensus of published reports, as at 30 August 2024,
from 12 analysts reflecting range of 40.7p to 44.6p with mean 42.8p
Enquiries
Safestore Holdings PLC
Frederic Vecchioli, Chief Executive Officer via Instinctif Partners
Simon Clinton, Chief Financial Officer
www.safestore.com (http://www.safestore.com)
Instinctif Partners
Guy Scarborough/ Joe Quinlan 0207 457 2020
Notes to Editors
· Safestore is the UK's largest self-storage group with 197
stores on 31 July 2024, comprising 135 wholly owned stores in
the UK (including 74 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), 30 wholly owned stores
in the Paris region, 12 stores in Spain, 14 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 over 90,000 personal and business
customers.
· As of 31 July 2024, Safestore had a maximum lettable area ("MLA")
of 8.520 million sq ft (excluding the expansion pipeline stores) of which
6.448 million sq ft was occupied.
· Safestore employs around 750 people in
the UK, Paris, Spain, the Netherlands, Belgium, and Germany.
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