Financial Highlights

Covid-19

• Health, safety and wellbeing of our employees and customers of paramount importance
• UK government’s Covid-19 related support schemes not accessed
• Stores operating normally with full observation of social distancing rules and protective personal equipment provided to employees

Robust Financial Performance

Despite the challenges of operating within the pandemic and the effects of various lockdowns, the business has performed robustly. Specifically, the highlights were:

• Group revenue for the year up 6.9% (up 7.0% in CER¹)
• Like-for-like² Group revenue for the year in CER¹ up 3.4%:
  • UK up 3.3%
  • Paris up 3.8%
• Underlying EBITDA³ up 7.4% in CER¹ which, combined with an increased gain on investment properties of £126.5 million (FY2019: £84.2 million), resulted in statutory operating profit⁴ of £212.2 million (FY2019: £163.7 million)
• Adjusted Diluted EPRA Earnings per Share⁵ up 6.0% at 30.2 pence (FY2019: 28.5 pence). Diluted Earnings per Share was 84.0 pence (FY2019: 62.6 pence) largely due to the higher property valuation gain in FY2020
• 5.8% increase in the final dividend to 12.7 pence (FY2019: 12.0 pence) giving a total for the year of 18.6 pence (FY2019: 17.5 pence)

Operational Focus

• Continued balanced approach to revenue management and efficient marketing platform driving returns:
  • Like-for-like² closing occupancy of 80.8% up 3.2ppts on 2019 (FY2019: 77.6%)
  • Like-for-like² average occupancy for the year up 2.3%
  • Like-for-like² average storage rate⁶ for the year up 2.0% in CER¹
  • Total average storage rate⁶ up 1.4% in CER¹ reflecting dilutive impact of new store openings
• New stores trading well and in line with business plans

Strategic Progress

• 125,000 sq ft of new MLA added in the UK with openings in London Carshalton, Gateshead and Sheffield
• Further new store openings scheduled at Paris-Magenta and Birmingham-Middleway in 2021
• Freehold interest of existing Basildon store acquired
• New 15-year lease signed on Notting Hill store
• Extensions of Bedford, Barking and Chingford stores, adding 37,000 sq ft
• Development sites London-Bermondsey and London-Park West Place acquired in the period
• Acquisition of Fort Box Self Storage (two London stores) on 5 November 2019 for £14.3 million⁷
• On 30 December 2019 the Group entered the Spanish self storage market with the acquisition of OMB Self Storage SL trading as OhMyBox! (four  stores in Barcelona) for €17.25 million
• Joint venture⁸ with Carlyle acquired Lokabox in Belgium (six prime locations in Brussels (2), Liege (2), Charleroi and Nivelles) in June 2020 and Opslag XL in the Netherlands (two freehold locations in The Hague and Hilversum, and one short leasehold in Amsterdam) in December  2020
• Continued development of Corporate and social responsibility (“CSR”) agenda illustrated by a GRESB “A” rating to go alongside the EPRA Silver and Most Improved Awards for the 2019 disclosures

Strong and Flexible Balance Sheet

• Group loan-to-value ratio (“LTV”⁹) at 29% (31 October 2019: 31%) and interest cover ratio (“ICR”¹⁰) at 9.0x (31 October 2019: 8.9x)
• Unutilised bank facilities of £148 million at October 2020 and no borrowings to refinance before June 2023
• 16.8% increase in property valuation (including investment properties under construction) driven by the acquisitions of Fort Box and OhMyBox! (“OMB”) in Spain⁷, new stores, revisions to exit cap rates, stabilised occupancy assumptions and FX.

Notes
We prepare our financial statements using IFRS. However, we also use a number of adjusted measures in assessing and managing the performance of the business. These include like-for-like figures, to aid in the comparability of the underlying business as they exclude the impact on results of purchased, sold, opened or closed stores. These metrics have been disclosed because management reviews and monitors performance of the business on this basis. We have also included a number of measures defined by EPRA, which are designed to enhance transparency and comparability across the European Real Estate sector, see notes 6 and 13 below and “Non-GAAP financial information” in the notes to the financial statements.

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 – Like-for-like adjustments have been made to remove the impact of the acquisition of Valencia, Calabria, Glories and Marina in Barcelona, the acquisition of Chelsea and St John’s Wood in London, the 2020 openings of Carshalton, Sheffield and Gateshead, the 2019 acquisition of Heathrow, and the 2019 openings of Peterborough, Birmingham-Merry Hill and Pontoise.
3 – Underlying EBITDA is defined as Operating Profit before exceptional items, share-based payments, corporate transaction costs, change in fair value of derivatives, gain/loss on investment properties, variable lease payments, depreciation payments and the share of associate’s depreciation, interest and tax. Underlying EBITDA therefore excludes all leasehold rent charges. Underlying profit before tax is defined as underlying EBITDA less leasehold rent, depreciation charged on property, plant and equipment and net finance charges relating to bank loans and cash.
4 – Operating profit increased by £48.5 million to £212.2 million (FY2019: £163.7 million) principally as a result of an increase in the gain on Investment properties of £42.3 million to £126.5 million (FY2019: £84.2 million), as well as an increase of £6.4 million or 7.3% in Underlying EBITDA as a result of stronger trading performance. Profit before tax additionally included an increase in the fair value of derivatives of £0.2 million (FY2019: net loss £2.1 million).
5 – 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.
6 – Average Storage Rate is calculated as the revenue generated from self storage revenues divided by the average square footage occupied during the period in question.
7 – The consideration paid for OMB on 30 December 2019 was £14.3 million net of cash acquired plus costs of approximately £0.3 million and for Fort Box Self Storage on 5 November 2019 was £13.6 million plus costs of approximately £0.7 million, both net of cash acquired and both are subject to customary working capital adjustment.
8 – The joint venture with Carlyle, which represents a 20% investment, has been accounted for as an associate using the equity method of accounting, as described in the “Investment in associates” note to the financial statements.
9 – LTV ratio is Loan-to-Value ratio, which is defined as gross debt (excluding lease liabilities) as a proportion of the valuation of investment properties and investment properties under construction (excluding lease liabilities).
10 – ICR is interest cover ratio, and is calculated as the ratio of underlying EBITDA after leasehold rent to underlying finance charges.