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Safestore Holdings plc

Safestore Holdings plc Solid H1 performance, on course to meet full year expectations

Safestore Holdings plc (LON: SAFE) have today provided interim results for the 6 months ended 30 April 2019.

Key Measures6 months ended 30 April 20196 months ended 30 April 2018Change1 Change-CER2
Underlying and Operating Metrics- total    
Revenue£73.1m£69.2m5.6%5.9%
Underlying EBITDA3£41.4m£39.1m5.9%6.1%
Closing Occupancy (let sq ft- million)44.654.503.3%n/a
Closing Occupancy (% of MLA)573.0%71.5%+1.5pptsn/a
Average Storage Rate£26.30£25.911.5%1.7%
Adjusted Diluted EPRA Earnings per Share613.5p12.6p7.1%n/a
Free Cash flow7£27.6m£23.1m19.5%n/a
EPRA Basic NAV per Share£4.06£3.5713.7%n/a
Underlying and Operating Metrics- like-for-like8    
Revenue£72.1m£68.3m5.6%5.9%
Underlying EBITDA3£41.2m£38.7m6.5%6.7%
Closing Occupancy (let sq ft- million)44.604.472.9%n/a
Closing Occupancy (% of MLA)574.3%72.1%+2.2pptsn/a
Average Occupancy (let sq ft- million)44.574.403.9%n/a
Average Storage Rate£26.22£25.781.7%1.9%
 
Statutory Metrics    
Profit before tax£38.2m£81.9m-53.4%n/a
Basic Earnings per Share16.4p40.3p-59.3%n/a
Dividend per Share5.5p5.1p7.8%n/a

Highlights

Solid Financial Performance

· Group revenue up 5.6% (5.9 % at CER2)

· Group like-for-like8 revenue at CER2 up 5.9% with UK up 5.6% and Paris up 6.3%

· Adjusted Diluted EPRA EPS6 up 7.1% at 13.5p

· 7.8% increase in the interim dividend to 5.5p

· Statutory Profit before tax down to £38.2m from £81.9m in 2018 driven by reduced gain on investment properties of £7.9m (2018: gain of £51.8m)

Operational and Strategic Progress

· Continued balanced approach to revenue management drives returns

o Like-for-like8 closing occupancy of 74.3% (up 2.2ppts on 2018)

o Like-for-like8 average occupancy for the period up 3.9%

o Like-for-like8 average storage rate for the period up 1.9% in CER2

· Peterborough site acquired for new 42,000 sq ft store to be opened at the end of 2019

· Further new store openings scheduled in Paris Pontoise in Summer 2019, London Carshalton and Birmingham Merry Hill in the second half of 2019, and Paris Magenta, subject to planning, in the 2019/20 financial year

· Extension of Bedford and Barking stores in early 2020, adding 29,000 sq ft

Strong and Flexible Balance Sheet

· Group loan-to-value ratio (“LTV”9) at 31%, interest cover ratio (“ICR”10) at 8.7x

Frederic Vecchioli, Safestore Holdings plc Chief Executive Officer, commented:

“Safestore’s performance has been robust in the first half of the year and continues to build on the strong earnings and dividend growth achieved over the last five years. Since we recommenced our store acquisition and development programme in 2016, we have added 38 stores, including our new store pipeline of three sites in the UK in London Carshalton, Birmingham Merry Hill and Peterborough (subject to planning) and two sites in Paris at Pontoise and Magenta (subject to planning). Going forward, we expect to be able to continue to seize consolidation opportunities as well as new development sites that can be turned relatively quickly into new stores.

The self-storage market remains resilient to macroeconomic uncertainty and we continue to capture growing levels of demand in the UK and in Paris, with double digit new let growth on a like-for-like basis on both markets. As we enter our peak trading period we are well-placed to meet this demand with our 1.72m sq ft of currently unlet, fully invested space, and our pipeline of five stores that will add a further 252,000 sq ft.

Our scale continues to allow us to invest in our digital marketing platforms and service proposition, and this remains a key competitive advantage in a fragmented industry. Our balance sheet remains strong and efficient, with a low cost of debt. Our existing financing capacity, combined with the strong free cash generation of the business, allows us to continue to target selected development and acquisition opportunities. With our leading market positions across the UK and in Paris, the Company is in a strong position with significant low-cost growth potential. We remain on-course to meet the Board’s full year expectations.”