Fourth Quarter Trading Update

28 November 2023

Safestore Holdings plc

("Safestore", "the Company" or "the Group")

 

Frederic Vecchioli, Chief Executive Officer, commented:

“After two years of out-performance in which the Group delivered total like-for-like⁵ 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 CER¹, the Group’s industry leading REVPAF9 grew by 1.4% on a like-for-like⁵ basis with like-for-like⁵ 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 Share⁷ in line with the guidance given in our third quarter trading statement⁸.”
 

Highlights

• Group revenue for the year in CER¹ was up 4.8% and 5.5% at actual exchange rates
• Like-for-like⁵ Group revenue for the year in CER¹ up 1.7%
• Like-for-like⁵ average rate for the year up 5.0% in CER¹
• Like-for-like⁵ 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 £25-£30m of stabilised EBITDA.
 

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For further information, please contact:

Safestore Holdings PLC     
Frederic Vecchioli, Chief Executive Officer    via Instinctif Partners
Andy Jones, Chief Financial Officer     
www.safestore.com

Instinctif Partners     
Guy Scarborough/ Bryn Woodward    07917 178920/ 07739 342009
 
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 – 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 £0.1m or to the nearest 10,000 sq ft, the effect of rounding may impact the reported percentage change.