REG - Big Yellow Group PLC - Results for the Six Months ended 30 September 2024
18/11/2024 16:45
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RNS Number : 6690M Big Yellow Group PLC 18 November 2024
18 November 2024
Big Yellow Group PLC
("Big Yellow", "the Group" or "the Company")
Results for the Six Months ended 30 September 2024
Six months ended Six months ended
30 September 2024
30 September 2023
Financial metrics Change
Revenue £103.0 million £99.6 million 3%
Store revenue ((1)) £102.2 million £98.3 million 4%
Like-for-like store revenue ((1,2)) £101.0 million £98.1 million 3%
Store EBITDA ((1)) £70.9 million £71.5 million (1%)
Adjusted profit before tax ((1)) £54.9 million £53.5 million 3%
EPRA earnings per share ((1)) 28.0 pence 29.0 pence (3%)
Interim dividend per share 22.6 pence 22.6 pence -
Statutory metrics
Profit before tax £145.8 million £119.6 million 22%
Cash flow from operating activities (after net finance costs and pre-working (1%)
capital movements)((3))
£53.5 million £54.3 million
Basic earnings per share 74.6 pence 65.3 pence 14%
Store metrics 6,421,000 6,419,000 -
Store Maximum Lettable Area ("MLA") ((1))
Closing occupancy (sq ft) ((1)) 5,168,000 5,228,000 (1%)
Occupancy growth in the period (sq ft) ((1)) 139,000 140,000 (1%)
Closing occupancy ((1)) 80.5% 81.4% (0.9 ppts)
Occupancy - like-for-like stores ((1,2)) 80.9% 82.4% (1.5 ppts)
Average achieved net rent per sq ft ((1)) £34.36 £33.02 4%
Closing net rent per sq ft ((1)) £34.77 £33.47 4%
(1) See note 20 for glossary of terms
(2) Excluding Kings Cross (opened June 2023)
(3) See reconciliation in Financial Review
Financial highlights
· Store revenue growth for the period was 4%, with like-for-like
store revenue up by 3%, principally through rental growth, and since the
period end we have seen some improvement in year-on-year occupancy performance
· Like-for-like occupancy increase of 1.9 ppts from 1 April 2024 and
down 1.5 ppts from same time last year to 80.9% (September 2023: 82.4%),
although this has now closed to 0.9 ppts
· Average achieved net rent per sq ft increased by 4% period on
period, closing net rent up by 4% from September 2023
· Overall store EBITDA was down 1% in the period following an
increase in store operating costs
· Adjusted profit before tax up 3% to £54.9 million, with EPRA
earnings per share down 3%, due to the additional shares in issue following
the placing in October 2023, only impacting the first half of the year
· Statutory profit before tax of £145.8 million compared to £119.6
million in the prior period following a higher revaluation gain in the period
· Cash flow from operating activities (after net finance costs and
pre-working capital movements) decreased by 1% to £53.5 million
· Interim dividend of 22.6 pence per share declared, in line with
prior period
Property highlights
· Opened new 65,000 sq ft freehold store in Slough Farnham Road,
customers successfully transferred from nearby existing leasehold store, which
will shortly be handed back to landlord
· Acquired freehold property in Leamington Spa, taking the pipeline
to 12 development sites and one replacement store of approximately 1.0 million
sq ft (15% of current MLA), of which 10 are in London or within close
proximity. 1.3 million sq ft of fully built vacant space is currently
available for future growth
· Planning consent granted for key London proposed stores at West
Kensington, Kentish Town (both at appeal) and Staples Corner; we now have 10
of our 13 pipeline stores with planning
· Disposal of land adjacent to our Battersea store for £30.9 million
with planning for residential development
Commenting, Nicholas Vetch CBE, Executive Chairman, said:
"Although it is pleasing that we expect to return to earnings per share growth
in the second half, we have always been more focussed on the longer term. We
will grow revenue through incrementally increasing occupancy levels from our
existing store platform, alongside driving efficiencies across the business
through investment in automation. Furthermore, and critically, we are fully
committed to capturing the opportunity of the revenue and earnings growth from
our store pipeline, most of which is now in the construction phase.
In addition, we expect to see more opportunities to acquire land and replenish
our development pipeline in our core areas of operation."
- Ends -
ABOUT US
Big Yellow is the UK's brand leader in self storage and operates from a
platform of 109 stores. We have a pipeline of 1.0 million sq ft comprising
13 proposed self storage facilities. The current maximum lettable area of
the existing platform is 6.4 million sq ft. When fully built out the
portfolio will provide approximately 7.4 million sq ft of flexible storage
space. 99% of our stores and sites by value are held freehold and long
leasehold, with the remaining 1% short leasehold. Currently by revenue 75%
of our stores are in London and its commuter towns, with the balance in larger
regional conurbations.
Our stores utilise state of the art technology for our digital and operating
platforms including security, and we focus on locating our stores in high
profile, accessible, main road locations. We also focus on providing
excellent customer service, a highly engaged employee culture, and with
significant and increasing investment in sustainability.
For further information, please contact:
Big Yellow Group PLC +44 (0)1276 477811
Nicholas Vetch CBE, Executive Chairman
Jim Gibson, Chief Executive Officer
John Trotman, Chief Financial Officer
Sodali & Co +44 (0)20 7250 1446
Ben Foster
CHAIRMAN'S STATEMENT
Big Yellow Group PLC, the UK's brand leader in self storage, is pleased to
announce its results for the six months ended 30 September 2024.
The last two years or so have been difficult with muted trading conditions,
cost pressures and until recently, sharp increases in the cost of debt, and in
that time the business has proved relatively resilient. Additionally, the
issuance of new equity has created a drag on earnings per share over the last
12 months.
The impact of higher operating costs has continued to wash through into this
first half of the year particularly property taxes, energy costs and wages.
This has been a constant pressure for over two years, and the largest increase
has come from property taxation, which represents 70% of the increase in our
same store operating expenses in that time. We do however expect our store
expense growth to moderate in the second half of the year and into next year
as the impact of inflation reduces and as we benefit from lower energy costs
and our investment into solar energy.
Adjusted profit before tax, which is up 3%, has benefited from the reduced
level of debt over the period. The interest rate reductions in August and
November will benefit more in the second half and into the following year
along with any further reductions in short term interest rates.
As reported in May, we have an opportunity to generate significant NOI growth
from our pipeline of stores and it was pleasing to win two planning appeals at
West Kensington and Kentish Town and to be granted planning on Staples Corner
during the period. From a planning perspective, our pipeline has largely
been de-risked and we have committed to the construction of the next nine
stores amounting to an additional capacity of 0.7 million sq ft, opening over
the next two to three years.
Financial results
Revenue for the period was £103.0 million (2023: £99.6 million), an increase
of 3%, with store revenue up 4%; we saw a decrease in income from our
development sites where we have now obtained vacant possession.
Like-for-like store revenue (which excludes new store openings) was up 3%,
driven by an increase in average achieved net rent, offset by a slight fall in
average occupancy. Store EBITDA was £70.9 million, a decrease of 1% from
the prior period (2023: £71.5 million).
The Group made an adjusted profit before tax in the period of £54.9 million,
up 3% from £53.5 million for the same period last year (see note 6).
Adjusted diluted EPRA earnings per share were 28.0 pence (2023: 29.0 pence), a
decrease of 3% due to the additional shares in issue following the placing in
October 2023, only impacting the first half of the year.
The Group's statutory profit before tax for the period was £145.8 million, an
increase from £119.6 million for the same period last year, due to a
revaluation surplus of £82.2 million in the period (2023: surplus of £67.2
million), reflecting the growth in net rents during the period, and a profit
arising on the disposal of land adjacent to our Battersea store of £8.8
million.
The Group's cash flow from operating activities (after net finance costs and
pre-working capital movements) decreased by 1% to £53.5 million for the
period (2023: £54.3 million).
Dividends
The Board has approved an interim dividend of 22.6 pence per share in line
with the prior period. This first half dividend has all been declared as
Property Income Distribution ("PID").
Development pipeline
During the period we opened our new freehold store in Slough Farnham Road,
replacing a nearby leasehold store. We have transferred the customers from
the old store and are in the process of stripping the building out before
returning it to the landlord. This is consistent with our strategy of
reducing our rent liabilities, which we view as quasi-debt. Slough Farnham
Road is our first net zero store, with a solar PV installation of 200 kWp (our
largest to date), battery storage for the energy we generate, and a number of
other sustainability features. These helped the store achieve a rare EPC
rating of A+.
As mentioned above, we have been successful in achieving three key planning
consents in London during the period; at West Kensington, Kentish Town and at
Staples Corner. The store in West Kensington will be only the second
purpose-built self storage facility in the London Borough of Hammersmith &
Fulham, alongside our Fulham store, with Kentish Town being the first
purpose-built store in the London Borough of Camden. These, along with the
other sites in the pipeline, are very high-quality locations, and will help
consolidate our market-leading platform. We now have planning consent on 10
of our 13 development sites.
We have commenced the construction process on the nine sites where we have
vacant possession and anticipate opening these stores over the next three
years, with three stores opening in the next financial year, five in the year
ended March 2027, and West Kensington later in 2027. The cost to complete
these nine stores is approximately £183 million.
The projected net operating income of the increase in our total capacity of
1.0 million sq ft when stabilised, at today's prices, is £31.4 million
representing an approximate 14% return on the incremental capital deployed.
If we include the replacement store at Staples Corner, due to open in Summer
2026, the proforma net operating income increases to £35.4 million, a return
of approximately 8.9% on the total development cost of approximately £400
million, including land already acquired.
Capital structure
It remains our view that elevated levels of debt over cycles destroys value
and hence our strategy is to maintain debt at modest levels. The Group's
interest cover for the period (expressed as the ratio of cash generated from
operations pre-working capital movements against interest paid) was 5.7 times
(2023: 5.3 times), with the Group's net debt to EBITDA ratio now 2.9x (2023:
3.8x).
Net debt was £359.5 million at 30 September 2024 (2023: £495.3 million),
giving the Group available committed liquidity of £214.6 million, with the
$225 million bilateral shelf facility with Pricoa also available.
Approximately 50% of our debt is fixed, with the balance floating, in line
with our hedging policy, and our current average cost of debt is 5.1% (2023:
5.7%). Any further cuts in interest rates will benefit the second half and
into next year.
Outlook
Although it is pleasing that we expect to return to earnings per share growth
in the second half, we have always been more focussed on the longer term. We
will grow revenue through incrementally increasing occupancy levels from our
existing store platform, alongside driving efficiencies across the business
through investment in automation. Furthermore, and critically, we are fully
committed to capturing the opportunity of the revenue and earnings growth from
our store pipeline, most of which is now in the construction phase.
In addition, we expect to see more opportunities to acquire land and replenish
our development pipeline in our core areas of operation.
Nicholas Vetch CBE
Executive Chairman
18 November 2024
BUSINESS AND FINANCIAL REVIEW
Store occupancy
We now have a portfolio of 109 open and trading stores, with a current maximum
lettable area of 6.4 million sq ft (2023: 109 stores, MLA of 6.4 million sq
ft).
Like-for-like occupancy increased by 1.9 ppts from 1 April 2024 but was down
1.5 ppts from the same time last year. Like-for-like store revenue growth
for the half year was 3%, driven by improvements in average achieved net rent
per sq ft.
Prospect numbers were down 5% on the prior period on a like-for-like basis,
however, our conversion levels improved with move-ins down only 1.5% and
move-outs in line with the same period last year.
Occupancy across all 109 stores increased by 139,000 sq ft over the six months
compared to a gain of 140,000 sq ft in the same period last year. Demand
from domestic customers has been higher than last year, up 143,000 sq ft
(2023: up 133,000 sq ft). Business occupancy dropped by 2% or 36,000 sq ft,
on 1.84 million sq ft occupied at the beginning of the period and student
occupancy rose by 32,000 sq ft. Approximately 70% of our revenue derives
from domestic and student customers, with the balance from our business
customers.
Although business occupancy has been a little softer over the six months, we
are seeing an improving move-in trend from businesses, particularly since the
period end and overall business occupancy has stabilised. We continue to see
demand from online traders, e-tailers and service providers. Over the six
months, revenue from national customers (businesses who occupy space in
multiple stores) has increased by 14% compared to the same period last year.
Since the period end, we have seen an improvement in activity levels, with
move-ins up 5% on the same period last year. Our third quarter is
historically the weakest trading quarter where we see a loss in occupancy with
a return to growth in the fourth quarter. In the current year, given the
improving move-in picture, we have lost 78,000 sq ft (1.2% of maximum lettable
area "MLA") since the end of September, compared to a loss of 113,000 sq ft
(1.8% of MLA) at the same stage last year. The like-for-like gap in
occupancy is now down to 0.9 ppts compared to 1.5 ppts at 30 September.
At 30 September, the 79 established Big Yellow stores were 82.7% occupied
compared to 85.1% at the same time last year. The six developing Big Yellow
stores added 46,000 sq ft of occupancy in the past six months to reach closing
occupancy of 62.6%. The Armadillo stores, representing 10% of the Group's
revenue, added 28,000 sq ft of occupancy with closing occupancy of 77.2%
(2023: 77.9%). Overall store occupancy was 80.5%.
Rental growth
We continue to manage pricing dynamically, taking account of room
availability, customer demand and local competition, with our pricing model
reducing promotions and increasing asking prices where individual units are in
scarce supply.
We price competitively to win new customers and increase rents to in-place
customers on a range dependent on what they are paying relative to the current
asking price, and on average these were at levels slightly ahead of wage
inflation. We have reduced our in-place increases to customers since January
given fallen inflation, and accordingly our average rate growth over the
period was 4% compared to 8% in the prior period. It must be remembered that
some 60% to 70% of our customers move-out within six months, and therefore do
not receive any price increases. New customers over the period paid on
average 2% more than move-ins for the same period last year, and 2% less than
customers moving out over the six months. If we can improve our relative
occupancy performance, we would expect to see this reverse and be an
additional driver to revenue growth.
The table below shows the change in net rent per sq ft for the portfolio by
average occupancy over the six months (on a non-weighted basis).
Average occupancy in the six months Net rent per sq ft growth from 1 April to 30 September 2024 Net rent per sq ft growth from 1 April to 30 September 2023
75% to 85% 1.6% 2.6%
85 to 90% 4.1% 3.5%
Above 90% 5.0% 4.7%
Security of income
We believe that self storage income is essentially evergreen income with
highly defensive characteristics driven from buildings with very low
obsolescence and relatively low maintenance requirements. Although our
contract with our customers is in theory as short as a week, we do not rely on
any one contract for our income security. At 30 September 2024 the average
length of stay for existing customers was 30.4 months (September 2023: 29.5
months). For all customers, including those who have moved out of the
business throughout the life of the portfolio, the average length of stay was
8.9 months (September 2023: 8.8 months). We have seen an increase in the
length of stay of customers who moved out over the rolling 12 months, which
increased to 9.9 months from 9.4 months for the same period last year.
38% of our customers by occupied space have been storing with us for over two
years (2023: 37%), and a further 16% of customers have been in the business
for between one and two years (2023: 15%). For the 54% of customers that
have stayed for more than one year, the average length of stay is 53 months.
Our business customer base is comprised of online retailers, B2B traders
looking for flexible mini-warehousing for e-fulfilment, service providers,
those looking to shorten supply chains, and businesses looking to rationalise
their other fixed costs of accommodation. For these customers, who typically
are looking for rooms which could be from 50 sq ft to 500 sq ft in facilities
that meet their operational requirements, the only supply in big cities is
from self storage providers.
We saw continued growth in occupancy from our domestic customer base, with
demand across a broad spectrum of uses. The majority of our customers are
represented in ACORN profiled groups such as Flourishing Capital, Up and
Coming Urbanites, Exclusive Addresses, Prosperous Professionals, Metropolitan
Surroundings, Upmarket Families, Urban Aspiring Flat Dwellers and Privately
Renting Professionals in Flats. The largest element of demand into our
business each year is customers who use us for relatively short periods driven
by a need.
We therefore have a very diverse base of domestic and business customers
currently occupying 75,000 rooms. This, together with the location and
quality of our stores, limited growth in new supply, market-leading brand and
digital platform, and customer service, all contribute to the resilience and
security of our income.
We are not seeing any deterioration in rent collection. Approximately 80% of
our customers pay by direct debit, and the proportion of our billings that is
more than 10 days overdue is in line with last year and lower than
pre-Covid. Our bad debt expense for the period was 0.2%, unchanged from last
year.
Revenue
Total revenue for the six-month period was £103.0 million, an increase of
£3.4 million (3%) from £99.6 million in the same period last year with store
revenue up 4%, offset by a decline in income from the development sites where
we have now obtained vacant possession. Like-for-like store revenue (see
glossary in note 20) was £102.2 million, an increase of 3% from the 2023
figure of £98.3 million.
Revenue growth for the period in our London stores was 4%, our South East
commuter stores 3%, and our regional stores 4%.
Other sales comprise the selling of packing materials, enhanced liability
service ("ELS"), and storage related charges. Our revenue from ELS increased
by 6% compared to the same period last year, after a focus on improving the
average level of cover we sell to customers.
The other revenue earned is tenant income on sites where we have not started
development.
Operating costs
Cost of sales comprises principally direct store operating costs, including
store staff salaries, utilities, business rates, insurance, a full allocation
of the central marketing budget, and repairs and maintenance.
The table below shows the breakdown of store operating costs compared to the
same period last year:
Period ended 30 September 2024 Period ended % of store operating costs in period
£000 30 September
Category 2023
£000 Change
Cost of sales (ELS and packing materials) 791 865 (9%) 3%
Staff costs 7,749 7,209 7% 25%
General & admin 882 812 9% 3%
Utilities 1,401 862 63% 5%
Property rates 10,493 9,135 15% 34%
Marketing 3,681 3,329 11% 12%
Repairs and maintenance 3,110 2,747 13% 10%
Insurance 1,767 1,697 4% 6%
Computer costs 578 509 14% 2%
Total before non-recurring items 30,452 27,165 12%
Non-recurring items (359) (1,388) (74%)
Total per portfolio summary 30,093 25,777 17%
Store operating costs have increased by £4.3 million (17%). The
non-recurring items in the prior period relate principally to the release of a
provision for property rates from the 2017 rating list, and a reassessment of
the Group's bad debt provision. In the current period the non-recurring
items are some credits that have been received following a reassessment of
property rates at certain stores.
Store operating costs before these non-recurring items have increased by £3.3
million (12%) compared to the same period last year. The additional
operating expense from new stores accounted for £0.6 million in the period.
The remaining increase is £2.7 million (10%), with commentary below:
- Cost of sales has reduced in line with packing material sales.
- Staff costs have increased by £0.5 million (7%), with the salary
review of on average 4.8% (including a higher increase to those at the lower
end of the pay scale reflecting the rise in the national living wage), coupled
with higher bonuses for the six months, which have averaged 11% compared to 8%
in 2023. There has also been an additional accrual for national insurance on
share options of £0.2 million. These increases have been partly offset by
savings on headcount, as we drive efficiencies into the stores through
automation.
- Utilities have increased by £0.5 million (63%) compared to the prior
period, with a new fixed rate contract starting in October 2023, which was at
a 74% higher rate than our expiring contract. This increase has been partly
mitigated by our investment in solar. We entered into a new contract from
October 2024 which reduced the rate by 18% and this will benefit the second
half of the year.
- Property rates have increased by £1.3 million (15%). The causes of
this increase are the impact of new stores; the unwinding of taper relief from
the introduction of the 2023 listing, and inflation applied to the multiplier
which was set at 6.7%, based on the CPI print to September 2023. The rates
payable for the next financial year will be based off the CPI to September
2024, which was 1.7%.
- Marketing has increased due to an increase in the PPC budget
over the summer months to drive additional prospects in a softer demand
environment. The spend represents 3.6% of revenue for the first six months.
- The repairs and maintenance expense has increased due to an
additional investment in security in our stores, the timing of spend in the
current year and an increase in solar panel maintenance costs, with higher
numbers of stores now with solar PVs.
- Computer costs have increased by £0.1 million (14%), which reflects
additional investment in systems to drive automation across the business.
The table below reconciles store operating costs per the portfolio summary to
cost of sales in the income statement:
Period ended 30 September 2024 Period
£000 ended 30 September 2023
£000
Direct store operating costs per portfolio summary (excluding rent) 30,093 25,777
Rent included in cost of sales (total rent payable is included in portfolio 853 915
summary)
Depreciation charged to cost of sales 267 280
Head office operational management costs charged to cost of sales 893 832
Cost of sales per income statement 32,106 27,804
Store EBITDA
Store EBITDA for the period was £70.9 million, a decrease of £0.6 million
(1%) from £71.5 million for the period ended 30 September 2023 (see Portfolio
Summary). The overall EBITDA margin for all stores during the period was
69.3%, down from 72.7% in 2023.
All stores are currently trading profitably at the Store EBITDA level.
Administrative expenses
Administrative expenses in the income statement have increased by £0.9
million (14%). The charge for national insurance on the exercise of share
options is higher than the same period last year following an increase in the
Company's share price. This is partly offset by a reduction in the IFRS 2
charge in the period; the net impact of these share-based payment related
charges is an increase of £0.5 million. The balance of £0.4 million is
largely inflationary.
Other income
In February 2022 the Group experienced a fire at our Cheadle store, which
resulted in a total loss to the store. Buildings all risk insurance is in
place for the full reinstatement value with the landlord. We have insurance
cover in place for both our fit-out and four years loss of income. The loss
of income booked during the first six months of the financial year was £1.0
million (2023: £0.8 million) which is included in other income.
Subsequent to the period end, the Group reached a final settlement with its
insurers over the claim and received a further £3.1 million. The total
amount received from the claim has been £12.1 million, of which £7.1 million
was for loss of income and £5.0 million in respect of the fit-out of the
store.
Interest expense on bank borrowings
Interest on bank borrowings during the period was £12.2 million, £1.5
million lower than the same period last year, with average debt levels lower
in the period following the placing in October 2023, partly offset by a higher
average cost of debt following the increase in interest rates in the prior
period. Our average cost of debt has now started to fall following the
reduction in interest rates in August and November.
Interest capitalised in the period amounted to £3.2 million (2023: £1.8
million), arising on the Group's construction programme.
Profit before tax
The Group's statutory profit before tax for the period was £145.8 million,
compared to £119.6 million for the same period last year. The increase in
profitability is due to a higher revaluation gain in the in the period and the
profit on the disposal of the land adjacent to our Battersea store.
After adjusting for the revaluation movement of investment properties and
other matters shown in the table below, the Group made an adjusted profit
before tax in the period of £54.9 million, up 3% from £53.5 million in 2023.
Six months ended 30 September 2024 Six months ended 30 September 2023
£m £m
Profit before tax analysis
Profit before tax 145.8 119.6
Gain on revaluation of investment properties (82.2) (67.2)
Gain on disposal of non-current asset (8.8) -
Change in fair value of interest rate derivatives 0.1 1.1
Adjusted profit before tax 54.9 53.5
Tax (0.1) -
Adjusted profit after tax 54.8 53.5
The movement in the adjusted profit before tax from the prior year is shown in
the table below:
Movement in adjusted profit before tax £m
Adjusted profit before tax for the six months to 30 September 2023 53.5
Decrease in gross profit (0.9)
Increase in administrative expenses (0.9)
Increase in other operating income 0.2
Decrease in net interest payable 1.6
Increase in capitalised interest 1.4
Adjusted profit before tax for the six months to 30 September 2024 54.9
Diluted EPRA earnings per share was 28.0 pence (2023: 29.0 pence). The
decrease of 3% from the same period last year, compares to an increase in
adjusted profit before tax of 3% due to the additional shares in issue
following the placing in October 2023.
Taxation
The Group is a Real Estate Investment Trust ("REIT"). We benefit from a
zero-tax rate on our qualifying self storage earnings. We only pay
corporation tax on the profits attributable to our residual business,
comprising primarily of the sale of packing materials and insurance, and
management fees earned by the Group.
There is a £0.7 million tax charge in the residual business for the period
ended 30 September 2024, partly offset by an adjustment to the prior year tax
estimate of £0.6 million (six months to 30 September 2023: £0.9 million,
largely offset in the income statement by an adjustment to the prior year tax
estimate).
Dividends
REIT regulatory requirements determine the level of Property Income
Distribution ("PID") payable by the Group. A PID of 22.6 pence per share is
proposed as the total interim dividend, in line with the same period last
year.
The interim dividend will be paid on 24 January 2025. The ex-dividend date
is 2 January 2025, and the record date is 3 January 2025.
Cash flow
Cash flows from operating activities (after net finance costs and pre-working
capital movements) have decreased by 1% to £53.5 million for the period
(2023: £54.3 million). These operating cash flows are after the ongoing
maintenance costs of the stores, which for this first half were on average
approximately £28,000 per store. The Group's net debt has reduced over the
period to £359.5 million (March 2024: £385.4 million), following the receipt
of £30.6 million from the disposal of land adjacent to our Battersea store.
There are distortive working capital items in the current period, and
therefore the summary cash flow below sets out the free cash flow pre-working
capital movements
Six months ended 30 September 2024 Six months ended 30 September 2023
£m £m
Cash generated from operations pre-working capital movements 65.5 68.3
Net finance costs (11.4) (12.8)
Interest on obligations under lease liabilities (0.3) (0.3)
Other operating income received 1.0 0.1
Tax (1.3) (1.0)
Cash flow from operating activities pre-working capital movements 53.5 54.3
Working capital movements 6.6 (3.5)
Cash flow from operating activities 60.1 50.8
Capital expenditure (20.6) (17.8)
Disposal of non-current asset 30.6 -
Cash flow after investing activities 70.1 33.0
Dividends (44.1) (41.7)
Payment of finance lease liabilities (0.9) (0.9)
Issue of share capital 0.7 0.9
(Decrease)/increase in borrowings (29.6) 7.4
Net cash outflow (3.8) (1.3)
The Group's interest cover for the period (expressed as the ratio of cash
generated from operations pre-working capital movements against interest paid)
was 5.7 times (2023: 5.3 times), with the increase following the reduction in
the interest expense over the period with lower average debt levels. This is
calculated per below:
30 September 2024 30 September 2023
£000 £000
Cash generated from operations pre working capital movements (see note 26) 65,489
68,259
Interest paid per cash flow statement (11,439) (12,778)
Interest cover 5.7x 5.3x
£3.4 million of the capital expenditure in the period related to the
acquisition of Leamington Spa, with the balance of £17.2 million principally
construction capital expenditure on our development programme but also
including our continued investment in solar retrofitting.
Balance sheet
Investment property
The Group's investment properties are carried at the half year at Directors'
valuation. They are valued externally by Jones Lang Lasalle ("JLL") at the
year end. The Directors' valuations reflect the latest cash flows derived
from each of the stores at the end of September.
In performing the valuations, the Directors consulted with JLL on the
capitalisation rates used in the valuations, which are based on the JLL
model. The Directors, as advised by the valuers, consider that the prime
capitalisation rates have remained stable since the March 2024 valuation date.
The Directors have made some minor amendments to a couple of the valuation
assumptions, namely the adjustment of stable occupancy levels on certain
stores that are consistently trading ahead of the previously used assumptions
and to certain assumptions on net achieved rents within the valuations.
Other than the above, the Directors believe the core assumptions used by JLL
in the March 2024 valuations are still appropriate at the September valuation
date.
At 30 September 2024 the external valuation of the Group's properties is shown
in the table below:
Analysis of property portfolio Value at 30 September 2024 Revaluation movement in the period
£m £m
Investment property 2,791.0 73.3
Investment property under construction 157.8 8.9
Investment property total 2,948.8 82.2
The revaluation surplus for the open stores in the period was £73.3 million,
reflecting growth in net achieved rents across the portfolio. The investment
property under construction revaluation surplus of £8.9 million reflects
the benefit of receiving planning consents in the past six months at West
Kensington, Kentish Town and Staples Corner.
The initial yield on the portfolio is 5.3% (31 March 2024: 5.2%). The
Group's annual report and accounts for the year ended 31 March 2024 contains a
detailed explanation of the valuation methodology.
Current development pipeline - with planning
Site Location Status Anticipated capacity
Staines, London Prominent location on the Causeway Construction commenced with a view to opening in Summer 2025. We are also 66,000 sq ft
developing 9 industrial units on the site totalling 99,000 sq ft.
Queensbury, London Prominent location off Honeypot Lane Construction commenced with a view to opening in Autumn 2025. 70,000 sq ft
Wembley, London Prominent location on Towers Business Park Construction to commence in late 2024 with a view to opening in early 2026. 73,000 sq ft
Slough Bath Road Prominent location on Bath Road Construction commenced with a view to opening in Spring 2026. 94,000 sq ft
Epsom, London Prominent location on East Street Demolition in progress, construction to commence in late 2024 with a view to 59,000 sq ft
opening in Summer 2026.
Staples Corner, London Prominent location on North Circular Road Demolition in progress, construction to commence in late 2024 with a view to Replacement for existing leasehold store, additional 18,000 sq ft
opening in Summer 2026.
Kentish Town, London Prominent location on Regis Road Demolition to start in early 2025, with a view to opening in Summer 2026. 68,000 sq ft
Wapping, London Prominent location on the Highway, adjacent to existing Big Yellow Demolition of existing building in progress, construction expected to commence Additional 95,000 sq ft
in late 2024 with a view to opening in late 2026.
West Kensington, London Prominent location on Hammersmith Road Demolition of existing building to commence in January 2025, with a view to 176,000 sq ft
opening in Autumn 2027.
Newcastle Scotswood Road Planning consent granted, vacant possession awaited. 60,000 sq ft
Current development pipeline - without planning
Old Kent Road, London Prominent location on Old Kent Road Site acquired in June 2022. Planning application submitted in October 2023, 77,000 sq ft
decision expected early 2025.
Leicester Prominent location on Belgrave Gate, Central Leicester Site acquired in June 2023. Planning discussions underway with Leicester 58,000 sq ft
City Council.
Leamington Spa Prominent location on Queensway Site acquired in May 2024. Planning discussions underway with local council. 55,000 sq ft
Total - all sites 969,000 sq ft
The capital expenditure forecast for the remainder of the financial year
(excluding any new site acquisitions) is approximately £43 million, which
principally relates to construction costs on our development sites and the
continued retrofitting of solar panels across the Group's estate.
Financing and treasury
Our financing policy is to fund our current needs through a mix of debt,
equity, and cash flow to allow us to build out, and add to, our development
pipeline and achieve our strategic growth objectives, which we believe improve
returns for shareholders. We aim to ensure that there are sufficient
medium-term facilities in place to finance our committed development
programme, secured against the freehold portfolio, with debt serviced by our
strong operational cash flows. We maintain a keen watch on medium and
long-term rates and the Group's policy in respect of interest rates is to
maintain a balance between flexibility and hedging of interest rate risk.
The table below shows the Group's debt position at 30 September 2024, with our
average interest cost shown after the base rate reduction in November:
Debt Expiry Facility Drawn Cost
Aviva Loan September 2028 £154.1m £154.1m 3.4%
M&G loan (£35 million fixed at 4.5%, £85 million floating)
September 2029 £120m £120m 6.6%
Revolving bank facility (Lloyds, HSBC and Barclays, 100% floating) December 2027 (option to extend for one further year)
£300m £91m 5.9%
Total £574.1m £365.1m 5.1%
Subsequent to the period end, the expiry of the bank facility was extended by
a year to December 2027, with the first "plus-one" option taken up. In
addition to the facilities above, the Group has a $225 million credit approved
shelf facility with Pricoa Private Capital ("Pricoa"), to be drawn in fixed
sterling notes. The Group can draw the debt in minimum tranches of £10
million over the next two years with terms of between 7 and 15 years at short
notice, typically 10 days.
The Group was comfortably in compliance with its banking covenants at 30
September 2024 and is forecast to be for the period covered by the going
concern statement.
The Group's key financial ratios are shown in the table below:
Ratio 30 September 2024 30 September 2023
Net debt to gross property assets 12% 18%
Net debt to adjusted net assets 13% 21%
Net debt to market capitalisation 14% 29%
Net debt to Group EBITDA ratio(1) 2.9x 3.8x
Cash generated from operations pre-working capital movements against interest
paid
5.7x 5.3x
(1) Annualising the Group EBITDA for the six months to 30 September
Net asset value
The adjusted net asset value per share is 1,348.0 pence (see note 13), up 4%
from 1,296.4 pence per share at 31 March 2024. The table below reconciles
the movement from 31 March 2024:
Equity shareholders' funds EPRA adjusted NAV pence per share
£m
Movement in adjusted net asset value
31 March 2024 2,561.9 1,296.4
Adjusted profit after tax 54.8 27.7
Equity dividends paid (44.1) (22.3)
Revaluation movements 82.2 41.6
Gain on disposal of non-current asset 8.8 4.4
Movement in purchaser's cost adjustment 3.2 1.6
Other movements (e.g. share schemes) 1.8 (1.4)
30 September 2024 2,668.6 1,348.0
Jim Gibson
John Trotman
Chief Executive
Officer
Chief Financial Officer
18 November 2024
PORTFOLIO SUMMARY
September 2024 September 2023
Big Yellow Established Big Yellow Developing Armadillo Big Yellow Established Big Yellow Developing Armadillo
Total Total
Number of stores((1)) 79 6 24 109 79 6 24 109
At 30 September:
Total capacity (sq ft) 4,991,000 422,000 1,008,000 6,421,000 4,989,000 422,000 1,008,000 6,419,000
Occupied space (sq ft) 4,126,000 264,000 778,000 5,168,000 4,247,000 196,000 785,000 5,228,000
Percentage occupied 82.7% 62.6% 77.2% 80.5% 85.1% 46.4% 77.9% 81.4%
Net rent per sq ft £37.09 £31.95 £23.46 £34.77 £35.67 £29.63 £22.44 £33.47
For the period:
REVPAF((2)) £34.79 £21.05 £21.11 £31.74 £34.07 £14.97 £20.17 £30.73
Average occupancy 83.2% 57.6% 78.2% 80.7% 85.1% 44.4% 77.9% 81.5%
Average annual net rent psf £36.66 £31.59 £23.22 £34.36 £35.14 £28.93 £22.42 £33.02
£000 £000 £000 £000 £000 £000 £000 £000
Self storage income 76,262 3,843 9,159 89,264 74,841 2,497 8,824 86,162
Other storage related 10,052 604 1,464 12,120 9,791 397 1,362 11,550
income ((2))
Ancillary store rental 750 6 37 793 611 16 10 637
Income
Total store revenue 87,064 4,453 10,660 102,177 85,243 2,910 10,196 98,349
Direct store operating (23,663) (2,238) (4,192) (30,093) (20,418) (1,650) (3,709) (25,777)
costs (excluding
depreciation)
Short and long (1,148) - (84) (1,232) (999) - (84) (1,083)
leasehold rent((3))
Store EBITDA((2)) 62,253 2,215 6,384 70,852 63,826 1,260 6,403 71,489
Store EBITDA margin 71.5% 49.7% 59.9% 69.3% 74.9% 43.3% 62.8% 72.7%
Deemed cost £m £m £m £m
To 30 September 2024 745.0 188.0 146.5 1,079.5
Capex to complete - 0.5 - 0.5
Total 745.0 188.5 146.5 1,080.0
(1) The Big Yellow established stores have been open for more than three
years at 1 April 2024, and the developing stores have been open for fewer than
three years at 1 April 2024. We opened a new freehold store at Slough
Farnham Road during the period. After transferring its customers to the new
Farnham Road store, we closed our leasehold Slough Whitby Road store during
the period. The occupancy, net rent and capacity at the balance sheet date
shows Slough Farnham Road within the Established stores, as it was effectively
a continuation of trade in a new location. The revenue and operating costs
for the period for both stores are shown within Established stores.
(2) See glossary in note 20.
(3) Rent under IFRS 16 for seven short leasehold properties accounted for
as investment properties under IAS 40.
The table below reconciles Store EBITDA to gross profit in the income
statement:
Period ended 30 September 2024 Period ended 30 September 2023
£000 £000
Store EBITDA Reconciling items Per income statement Store EBITDA Reconciling items Per income statement
Store revenue/Revenue((4)) 102,177 782 98,349 1,215
102,959 99,564
Cost of sales((5)) (30,093) (2,013) (32,106) (25,777) (2,027) (27,804)
Rent((6)) (1,232) 1,232 - (1,083) 1,083 -
70,852 1 70,853 71,489 271 71,760
(4) See note 2 of the interim statement, reconciling items are
non-storage income.
(5) See reconciliation in cost of sales section in Business and
Financial Review.
(6) The rent shown above is the cost associated with leasehold
stores, only part of which is recognised within gross profit in line with
finance lease accounting principles. The amount included in gross profit is
shown in the reconciling items in cost of sales.
RESPONSIBILITY STATEMENT
We confirm that to the best of our knowledge:
- the condensed set of financial statements has been prepared in
accordance with IAS 34 Interim Financial Reporting as adopted for use in the
UK;
- the interim management report includes a fair review of the
information required by:
a) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being
an indication of important events that have occurred during the first six
months of the financial year and their impact on the condensed set of
financial statements; and a description of the principal risks and
uncertainties for the remaining six months of the year; and
b) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being
related party transactions that have taken place in the first six months of
the current financial year and that have materially affected the financial
position or performance of the entity during that period; and any changes in
the related party transactions described in the last annual report that could
do so.
By order of the Board
Jim Gibson
John Trotman
Chief Executive
Officer
Chief Financial Officer
18 November 2024
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Six months ended 30 September 2024
Six months ended Six months ended
30 September 2024 30 September 2023
(unaudited) (unaudited) Year ended 31 March 2024
(audited)
Note £000 £000 £000
Revenue 2 102,959 99,564 199,619
Cost of sales (32,106) (27,804) (55,994)
Gross profit 70,853 71,760 143,625
Administrative expenses (7,802) (6,864) (15,219)
Operating profit before gains and losses on property assets 63,051 64,896 128,406
Gain on the revaluation of investment properties 9a 82,204 67,165 131,159
Gain on disposal of non-current asset 9a 8,754 - -
Operating profit 154,009 132,061 259,565
Other income 2 1,000 762 6,517
Investment income - interest receivable 3 93 17 45
Finance costs - interest payable 4 (9,233) (12,157) (22,946)
- fair value movement of derivatives (81) (1,071) (2,146)
Profit before taxation 145,788 119,612 241,035
Taxation 5 (136) (20) (1,202)
Profit for the period (attributable to equity shareholders) 145,652 119,592 239,833
Total comprehensive income for the period attributable to equity shareholders 145,652 119,592 239,833
Basic earnings per share 8 74.6p 65.3p 127.1p
Diluted earnings per share 8 74.4p 64.9p 126.4p
Adjusted profit before taxation is shown in note 6 and EPRA earnings per share
is shown in note 8.
All items in the income statement relate to continuing operations.
CONDENSED CONSOLIDATED BALANCE SHEET
30 September 2024
30 September 30 September
2024 2023 31 March 2024
(unaudited)
(unaudited)
(audited)
£000 £000
Note £000
Non-current assets
Investment property 9a 2,791,000 2,604,745 2,718,525
Investment property under construction 9a 157,837 186,847 146,485
Right-of-use assets 9a 16,353 17,952 17,152
Plant, equipment, and owner-occupied property 9b 3,820 4,159 3,870
Intangible assets 9c 1,433 1,433 1,433
Investment 9d 588 588 588
2,971,031 2,815,724 2,888,053
Current assets
Inventories 481 483 486
Trade and other receivables 10 13,540 11,199 10,116
Cash and cash equivalents 5,600 7,069 9,356
19,621 18,751 19,958
Total assets 2,990,652 2,834,475 2,908,011
Current liabilities (58,233) (50,714) (49,396)
Trade and other payables 11
Borrowings 12 (3,399) (3,237) (3,317)
Obligations under lease liabilities (2,089) (2,252) (2,253)
(63,721) (56,203) (54,966)
Non-current liabilities
Borrowings 12 (357,415) (497,076) (386,371)
Obligations under lease liabilities (15,764) (17,333) (16,474)
Derivative financial instruments 12 (1,911) (755) (1,830)
(375,090) (515,164) (404,675)
Total liabilities (438,811) (571,367) (459,641)
Net assets 2,551,841 2,263,108 2,448,370
Equity
Called up share capital 19,671 18,456 19,620
Share premium account 398,420 291,774 397,686
Reserves 2,133,750 1,952,878 2,031,064
Equity shareholders' funds 2,551,841 2,263,108 2,448,370
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Six months ended 30 September 2024 (unaudited)
Share premium account Other non-distributable reserve Capital redemption reserve Own shares
Share £000 £000 £000 Retained earnings £000 Total
capital £000 £000
£000
At 1 April 2024 19,620 397,686 74,950 1,795 1,955,316 (997) 2,448,370
Total comprehensive income for the period - -
- - 145,652 - 145,652
Issue of share capital 51 734 - - - - 785
Credit to equity for equity-settled share-based payments - -
- - 1,169 - 1,169
Use of own shares to satisfy share options - - (198) -
- - 198
Dividends - - - - (44,135) - (44,135)
At 30 September 2024 19,671 398,420 74,950 1,795 2,057,804 (799) 2,551,841
Six months ended 30 September 2023 (unaudited)
Share premium account Other non-distributable reserve Capital redemption reserve Own shares
Share £000 £000 £000 Retained earnings £000 Total
capital £000 £000
£000
At 1 April 2023 18,427 290,857 74,950 1,795 1,797,436 (1,019) 2,182,446
Total comprehensive income for the period - -
- - 119,592 - 119,592
Issue of share capital 29 917 - - - - 946
Credit to equity for equity-settled share-based payments -
- - - 2,063 - 2,063
Dividends - - - - (41,939) - (41,939)
At 30 September 2023 18,456 291,774 74,950 1,795 1,877,152 (1,019) 2,263,108
Year ended 31 March 2024 (audited)
Share capital Share premium account Other non-distributable reserve Capital redemption reserve Retained earnings Total
£000 £000 £000 £000 £000 Own shares £000
£000
At 1 April 2023 18,427 290,857 74,950 1,795 1,797,436 (1,019) 2,182,446
Total comprehensive income for the year - - 239,833 239,833
- - -
Issue of share capital 1,193 106,829 - - - - 108,022
Credit to equity for equity-settled share-based payments - - 4,082 4,082
- - -
Use of own shares to satisfy share options - - (22) -
- - 22
Dividends - - - - (86,013) - (86,013)
At 31 March 2024 19,620 397,686 74,950 1,795 1,955,316 (997) 2,448,370
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
Six months ended 30 September 2024
Six months ended Six months Year
30 September ended ended
2024
30 September 31 March
(unaudited)
2023
2024
£000 (unaudited)
(audited)
£000
Note £000
Cash generated from operations 17 72,055 64,789 129,826
Bank interest paid (11,439) (12,778) (24,069)
Interest on obligations under lease liabilities (268) (293) (575)
Interest received 75 17 45
Other operating income received 1,000 61 1,561
Tax paid (1,321) (989) (1,996)
Cash flows from operating activities 60,102 50,807 104,792
Investing activities
Purchase of non-current assets (20,580) (17,804) (30,910)
Disposal of non-current asset 30,591 - 5,400
Insurance proceeds on fit-out - - 4,722
Cash flows from investing activities 10,011 (17,804) (20,788)
Financing activities
Issue of share capital 785 946 108,022
Payment of finance lease liabilities (935) (908) (1,829)
Equity dividends paid (44,081) (41,741) (85,259)
Loan arrangement fees paid - - (3,752)
(Decrease)/increase in borrowings (29,638) 7,440 (100,159)
Cash flows from financing activities (73,869) (34,263) (82,977)
Net (decrease)/increase in cash and cash equivalents (3,756) (1,260) 1,027
Opening cash and cash equivalents 9,356 8,329 8,329
Closing cash and cash equivalents 5,600 7,069 9,356
Notes to the Interim Review
1. ACCOUNTING POLICIES
Basis of preparation
The results for the period ended 30 September 2024 are unaudited and were
approved by the Board on 18 November 2024. The financial information
contained in this report in respect of the year ended 31 March 2024 does not
constitute statutory accounts within the meaning of section 434 of the
Companies Act 2006. A copy of the statutory accounts for that year has been
delivered to the Registrar of Companies. The auditor's report on those
accounts was not qualified and did not contain statements under section 498
(2) or (3) of the Companies Act 2006.
This condensed set of financial statements has been prepared in accordance
with IAS 34 Interim Financial Reporting as adopted for use in the UK.
The annual financial statements of the Group are prepared in accordance with
UK-adopted international accounting standards. As required by the Disclosure
Guidance and Transparency Rules of the Financial Conduct Authority, the
condensed set of financial statements has been prepared applying the
accounting policies and presentation that were applied in the preparation of
the Group's published consolidated financial statements for the year ended 31
March 2024.
Valuation of assets and liabilities held at fair value
For those financial instruments held at fair value, the Group has categorised
them into a three-level fair value hierarchy based on the priority of the
inputs to the valuation technique in accordance with IFRS 13. The hierarchy
gives the highest priority to quoted prices in active markets for identical
assets or liabilities (Level 1) and the lowest priority to unobservable inputs
(Level 3). If the inputs used to measure fair value fall within different
levels of the hierarchy, the category level is based on the lowest priority
level input that is significant to the fair value measurement of the
instrument in its entirety. The fair value of the Group's outstanding
interest rate derivative has been estimated by calculating the present value
of future cash flows, using appropriate market discount rates, representing
Level 2 fair value measurements as defined by IFRS 13. Investment Property
and Investment Property under Construction have been classified as Level 3.
This is discussed further in note 14.
Going concern
A review of the Group's business activities, together with the factors likely
to affect its future development, performance, and position, is set out in the
Chairman's Statement and the Business and Financial Review. The financial
position of the Group, its cash flows, liquidity position and borrowing
facilities are shown in the balance sheet, cash flow statement and
accompanying notes to the interim statement. Further information concerning
the Group's objectives, policies, and processes for managing its capital; its
financial risk management objectives; details of its financial instruments and
hedging activities; and its exposures to credit risk and liquidity risk remain
the same and can be found in the Strategic Report within the Group's Annual
Report for the year ended 31 March 2024.
At 30 September 2024 the Group had available liquidity of £214.6 million,
from a combination of cash and undrawn debt facilities. In addition, the
Group has a $225 million shelf facility in place with Pricoa Private Capital
to be drawn in fixed sterling notes. The Group can draw the debt in minimum
tranches of £10 million over the next two years with terms of between 7 and
15 years at short notice, typically 10 days. The Group is cash generative
and for the six months ended 30 September 2024, had operational cash flow of
£53.5 million, with capital commitments at the balance sheet date of £60.6
million.
The Directors have prepared cash flow forecasts for a period of 18 months from
the date of approval of these financial statements, taking into account the
Group's operating plan and budget for the year ending 31 March 2025 and
projections contained in the longer-term business plan which covers the period
to March 2028. After reviewing these projected cash flows together with the
Group's and Company's cash balances, borrowing facilities and covenant
requirements, and potential property valuation movements over that period, the
Directors believe that, taking account of severe but plausible downsides, the
Group and Company will have sufficient funds to meet their liabilities as they
fall due for that period.
In making their assessment, the Directors have carefully considered the
outlook for the Group's trading performance and cash flows as a result of the
current geopolitical and macroeconomic environment, taking into account the
recent trading performance of the Group. The Directors have also considered
the performance of the business during the Global Financial Crisis and the
Covid-19 pandemic. The Directors modelled a number of different scenarios,
including material reductions in the Group's occupancy rates and property
valuations, and assessed the impact of these scenarios against the Group's
liquidity and the Group's banking covenants. The scenarios considered did
not lead to breaching any of the banking covenants, and the Group retained
sufficient liquidity to meet its financial obligations as they fall due.
Consequently, the Directors continue to adopt the going concern basis in
preparing the half year report.
2. SEGMENTAL INFORMATION
Revenue represents amounts derived from the provision of self storage
accommodation and related services after deduction of trade discounts and
value added tax. The Group's net assets, revenue and profit before tax are
attributable to one activity, the provision of self storage accommodation and
related services. These all arise in the United Kingdom.
Six months ended Six months ended Year ended
30 September 2024 30 September 2023 (unaudited) 31 March 2024
(unaudited) £000 (audited)
£000
£000
Open stores
Self storage income 89,264 86,162 173,147
Enhanced liability service income 9,470 8,927 17,649
Packing materials income 1,519 1,631 2,854
Other income from storage customers 1,131 992 2,051
Ancillary store rental income 793 637 1,411
102,177 98,349 197,112
Other revenue
Non-storage income 782 1,215 2,507
Total revenue 102,959 99,564 199,619
Non-storage income derives principally from rental income earned from tenants
of properties awaiting development.
The Group has also earned other operating income of £1.0 million in the
period, which is principally insurance proceeds for loss of income following
the destruction of the Group's Cheadle store by fire in 2022 (2023: £0.8
million).
Further analysis of the Group's operating revenue and costs are in the
Portfolio Summary and the Business and Financial Review. The seasonality of
the business is discussed in note 18.
3. INVESTMENT INCOME
Six months ended 30 September Six months Year ended
2024 ended 30 September 31 March
(unaudited) 2023 2024
£000 (unaudited) (audited)
£000 £000
Interest receivable 93 17 45
Total investment income 93 17 45
4. FINANCE COSTS
Six months ended 30 September Six months Year ended
2024 ended 30 September 31 March
(unaudited) 2023 2024
£000 (unaudited) (audited)
£000 £000
Interest on bank borrowings 12,161 13,617 25,624
Capitalised interest (3,196) (1,753) (3,254)
Interest on finance lease obligations 268 293 575
Other interest payable - - 1
Total interest payable 9,233 12,157 22,946
Fair value movement on derivatives 81 1,071 2,146
Total finance costs 9,314 13,228 25,092
5. TAXATION
The Group is a REIT. As a result, the Group does not pay UK corporation tax on
the profits and gains from its qualifying rental business in the UK if it
meets certain conditions. Non-qualifying profits and gains of the Group are
subject to corporation tax as normal. The Group monitors its compliance with
the REIT conditions. There have been no breaches of the conditions to date.
Six months ended 30 September Six months Year ended
2024 ended 30 September 31 March
(unaudited) 2023 2024
£000 (unaudited) (audited)
£000 £000
Current tax:
- Current year 705 983 2,270
- Prior year (569) (963) (1,068)
136 20 1,202
6. ADJUSTED PROFIT
Six months ended Six months Year ended
30 September 2024 ended 31 March
(unaudited) 30 September 2024
£000 2023 (audited)
(unaudited) £000
£000
Profit before tax 145,788 119,612 241,035
Gain on revaluation of investment properties (82,204) (67,165) (131,159)
Gain on disposal of non-current asset (8,754) - -
Change in fair value of interest rate derivatives 81 1,071 2,146
EPRA adjusted profit before tax 54,911 53,518 112,022
Cheadle fit-out insurance proceeds - - (4,723)
Adjusted profit before tax 54,911 53,518 107,299
Tax (136) (20) (1,202)
Adjusted profit after tax 54,775 53,498 106,097
Adjusted profit before tax which excludes gains and losses on the revaluation
of investment properties, changes in fair value of interest rate derivatives,
net gains and losses on disposal of investment property, and material
non-recurring items of income and expenditure have been disclosed as, in the
Board's view, this provides a clearer understanding of the Group's underlying
trading performance.
7. DIVIDENDS
Six months ended Six months
30 September 2024 ended
(unaudited) 30 September
£000 2023
(unaudited)
£000
Amounts recognised as distributions to equity holders in the period:
Final dividend for the year ended 31 March 2024 of 22.6p (2023: 22.9p) per 44,135 41,939
share
Proposed interim dividend for the year ending 31 March 2025 of 22.6p (2024: 44,258 44,086
22.6p) per share
The proposed interim dividend of 22.6 pence per ordinary share will be paid to
shareholders on 24 January 2025. The ex-dividend date is 2 January 2025, and
the record date is 3 January 2025. The interim dividend is all Property
Income Distribution.
8. EARNINGS PER ORDINARY SHARE
The European Public Real Estate Association ("EPRA") has issued recommended
bases for the calculation of certain per share information and these are
included in the following table:
Six months ended Six months ended Year ended
30 September 2024 (unaudited) 30 September 2023 (unaudited) 31 March 2024 (audited)
Earnings Shares Pence Earnings Shares Pence Earnings Shares Pence
£m million per share £m million per share £m million per share
Basic 145.7 195.4 74.6 119.6 183.2 65.3 239.8 188.7 127.1
Dilutive share options - 0.6 (0.2) - 1.1 (0.4) - 1.1 (0.7)
Diluted 145.7 196.0 74.4 119.6 184.3 64.9 239.8 189.8 126.4
Adjustments:
Gain on revaluation of investment properties (82.2) - (41.9) (67.2) - (36.5) (131.2) - (69.1)
Gain on disposal of non-current assets (8.8) - (4.5) - - - - - -
Change in fair value of interest rate derivatives 0.1 - - 1.1 - 0.6 2.2 - 1.1
EPRA earnings 54.8 196.0 28.0 53.5 184.3 29.0 110.8 189.8 58.4
Cheadle fit-out insurance proceeds - - - - - -
(4.7) - (2.5)
Adjusted - diluted 54.8 196.0 28.0 53.5 184.3 29.0 106.1 189.8 55.9
Adjusted - basic 54.8 195.4 28.0 53.5 183.2 29.2 106.1 188.7 56.2
The calculation of basic earnings is based on profit after tax for the period.
The weighted average number of shares used to calculate diluted earnings per
share has been adjusted for the conversion of share options.
EPRA earnings and earnings per ordinary share have been disclosed to give a
clearer understanding of the Group's underlying trading performance.
9. NON-CURRENT ASSETS
a) Investment property
Investment property under construction Right-of-use assets
Investment £000 £000
property Total
£000 £000
At 1 April 2024 2,718,525 146,485 17,152 2,882,162
Additions 3,897 16,684 - 20,581
Capitalised interest - 3,196 - 3,196
Disposal (22,154) - - (22,154)
Reclassification 17,394 (17,394) - -
Revaluation 73,338 8,866 - 82,204
Depreciation - - (799) (799)
At 30 September 2024 2,791,000 157,837 16,353 2,965,190
The disposal of investment property in the period was the sale of land
adjacent to our Battersea store for £30.9 million for residential
development. The gain on disposal of non-current assets is shown in the
comprehensive statement of income and has been excluded from the Group's
adjusted profit before tax for the period.
Capital commitments at 30 September 2024 were £60.6 million (31 March 2024:
£3.9 million).
b) Plant, equipment, and owner-occupied property
Motor vehicles Fixtures, fittings, and office equipment
Freehold property Leasehold improve-ments Plant and £000 £000 Right-of-use assets
machinery
£000 £000
£000 Total
£000
£000
Cost
At 1 April 2024 2,369 59 769 32 1,521 1,006 5,756
Additions 15 - 56 36 313 - 420
Disposal - - - (32) - - (32)
Retirement of fully depreciated assets - (39) - (358)
- (319) -
At 30 September 2024 2,384 59 786 36 1,515 1,006 5,786
Accumulated depreciation
At 1 April 2024 (732) (24) (258) (32) (283) (557) (1,886)
Charge for the period (25) (2) (87) (1) (288) (67) (470)
Disposal - - - 32 - - 32
Retirement of fully depreciated assets - 39 - 358
- 319 -
At 30 September 2024 (757) (26) (306) (1) (252) (624) (1,966)
Net book value
At 30 September 2024 1,627 33 480 35 1,263 382 3,820
At 31 March 2024 1,637 35 511 - 1,238 449 3,870
c) Intangible assets
The intangible asset relates to the Big Yellow brand, which was acquired
through the acquisition of Big Yellow Self Storage Company Limited in 1999.
The carrying value of £1.4 million remains unchanged from the prior year as
there is considered to be no impairment in the value of the asset. The asset
has an indefinite life and is tested annually for impairment or more
frequently if there are indicators of impairment.
d) Investment
The Group has a £0.6 million investment in Doncaster Security Operations
Centre Limited, a company which provides out-of-hours monitoring and alarm
receiving services, including for the Group's stores. The investment is
carried at cost and tested annually for impairment.
10. TRADE AND OTHER RECEIVABLES
30 September 30 September 31 March
2024 2023 2024
(unaudited) (unaudited) (audited)
£000 £000 £000
Current
Trade receivables 6,864 5,466 6,250
Other receivables 1,360 335 312
Prepayments and accrued income 5,316 5,398 3,554
13,540 11,199 10,116
11. TRADE AND OTHER PAYABLES
30 September 30 September 31 March
2024 2023 2024
(unaudited) (unaudited) (audited)
£000 £000 £000
Current
Trade payables 1,293 2,845 2,437
Other payables 27,210 18,213 18,166
Accruals and deferred income 29,730 29,656 28,793
58,233 50,714 49,396
12. BORROWINGS
30 September 30 September 31 March
2024 2023 2024
(unaudited) (unaudited) (audited)
£000 £000 £000
Aviva loan 3,399 3,237 3,317
Current borrowings 3,399 3,237 3,317
Aviva loan 150,731 154,130 152,451
M&G loan 120,000 120,000 120,000
Bank borrowings 91,000 225,000 119,000
Unamortised debt arrangement costs (4,316) (2,054) (5,080)
Non-current borrowings 357,415 497,076 386,371
Total borrowings 360,814 500,313 389,688
The Group does not hedge account for its interest rate swaps and states them
at fair value, with changes in fair value included in the income statement.
The loss in the income statement for the period on its interest rate swaps
was £81,000 (2023: loss of £1,071,000).
At 30 September 2024 the Group was in compliance with all loan covenants.
The movement in the Group's loans are shown net in the cash flow statement
as the bank loan is a revolving facility and is repaid and redrawn each month.
13. ADJUSTED NET ASSETS PER SHARE
EPRA's Best Practices Recommendations guidelines contain three Net Asset Value
(NAV) metrics: EPRA Net Tangible Assets (NTA), EPRA Net Reinstatement Value
(NRV) and EPRA Net Disposal Value (NDV).
EPRA NTA is considered to be most consistent with the nature of Big Yellow's
business which provides sustainable long-term progressive returns. EPRA NTA
is shown in the table below. This measure is further adjusted by the
adjustment the Group makes for purchaser's costs, which is the Group's
Adjusted Net Asset Value (or Adjusted NAV).
Basic net assets per share are shareholders' funds divided by the number of
shares at the period end. Any shares currently held in the Group's Employee
Benefit Trust are excluded from both net assets and the number of shares.
Adjusted net assets per share include: the effect of those shares issuable
under employee share option schemes and the effect of alternative valuation
methodology assumptions (see note 14).
Six months ended 30 September 2024 Six months ended 30 September 2023 Year ended 31 March 2024
Equity attributable to ordinary shareholders Equity attributable to ordinary shareholders Equity attributable to ordinary shareholders
£000 £000 £000
Pence per share Pence per share Pence per share
Shares Shares Shares
million million million
Basic NAV 2,551,841 195.8 1,303.1 2,263,108 183.4 1,233.8 2,448,370 195.1 1,255.0
Share and save as you earn schemes
2,020 2.2 (13.1) 2,107 2.3 (13.8) 2,019 2.5 (15.0)
Diluted NAV 2,553,861 198.0 1,290.0 2,265,215 185.7 1,220.0 2,450,389 197.6 1,240.0
Fair value of derivatives 1,911 - 0.9 755 - 0.4 1,830 - 0.9
Intangible assets (1,433) - (0.7) (1,433) - (0.8) (1,433) - (0.7)
EPRA NTA 2,554,339 198.0 1,290.2 2,264,537 185.7 1,219.6 2,450,786 197.6 1,240.2
Valuation methodology assumption (see note 14)
114,290 - 57.8 107,545 - 57.9 111,095 - 56.2
Adjusted NAV 2,668,629 198.0 1,348.0 2,372,082 185.7 1,277.5 2,561,881 197.6 1,296.4
14. VALUATION OF INVESTMENT PROPERTY
The Group has classified the fair value investment property and the investment
property under construction within Level 3 of the fair value hierarchy. There
has been no transfer to or from Level 3 in the period.
The freehold and leasehold investment properties have been valued at 30
September 2024 by the Directors. The valuation has been carried out in
accordance with the same methodology as the year end valuations prepared by
Jones Lang Lasalle ("JLL").
The Directors' valuations reflect the latest cash flows derived from each of
the stores at 30 September 2024. In performing the valuations, the Directors
consulted with JLL on the capitalisation rates used in the valuations. The
Directors, as advised by JLL, consider that the capitalisation rates for prime
self storage stores are unchanged since the year end valuation date, with
continuing demand being seen from investors for self storage assets.
The Directors have made some minor amendments to a couple of the valuation
assumptions, namely the adjustment of stable occupancy levels on certain
stores that are consistently trading ahead of the previously used assumptions
and to certain assumptions on net achieved rents within the valuations.
Other than the above, the Directors believe the core assumptions used by JLL
in the March 2024 valuations are still appropriate at the September valuation
date. See the Group's annual report for the year ended 31 March 2024 for the
full detail of the valuation methodology.
Sensitivities
Self storage valuations are complex, derived from data which is not widely
publicly available and involve a degree of judgement. For these reasons we
have classified the valuations of our property portfolio as Level 3 as defined
by IFRS 13. Inputs to the valuations, some of which are 'unobservable' as
defined by IFRS 13, include capitalisation yields, stable occupancy rates, and
rental growth rates. The existence of an increase of more than one
unobservable input would augment the impact on valuation. The impact on the
valuation would be mitigated by the inter-relationship between unobservable
inputs moving in opposite directions. For example, an increase in stable
occupancy may be offset by an increase in yield, resulting in no net impact on
the valuation. A sensitivity analysis showing the impact on valuations of
changes in yields and stable occupancy is shown below:
Impact of a change in capitalisation rates Impact of a change in stabilised occupancy assumption
25 bps decrease 25 bps increase 1% increase 1% decrease
2024 4.8% (4.4%) 1.0% (1.1%)
2023 4.7% (4.3%) 1.2% (1.2%)
A sensitivity analysis has not been provided for a change in the rental growth
rate adopted as there is a relationship between this measure and the discount
rate adopted. So, in theory, an increase in the rental growth rate would
give rise to a corresponding increase in the discount rate and the resulting
value impact would be limited.
Valuation assumption for purchaser's costs
The Group's investment property assets have been valued for the purposes of
the financial statements after deducting notional weighted average purchaser's
cost of 6.8% of gross value, as if they were sold directly as property assets.
The valuation is an asset valuation that is entirely linked to the operating
performance of the business. The assets would have to be sold with the
benefit of operational contracts, employment contracts and customer contracts,
which would be very difficult to achieve except in a corporate structure.
This approach follows the logic of the valuation methodology in that the
valuation is based on a capitalisation of the net operating income after
allowing for the deduction of operational costs and an allowance for central
administration costs. Sale in a corporate structure would result in a
reduction in the assumed Stamp Duty Land Tax but an increase in other
transaction costs, reflecting additional due diligence, resulting in a reduced
notional purchaser's cost of 2.75% of gross value. All the significant sized
transactions that have been concluded in the UK in recent years were completed
in a corporate structure. The Directors have therefore carried out a
valuation on the above basis, and this results in a higher property valuation
at 30 September 2024 of £3,063.1 million (£114.3 million higher than the
value recorded in the balance sheet) which translates to 57.8 pence per share.
We have included this revised valuation in the adjusted diluted net asset
calculation (see note 13).
15. FINANCIAL INSTRUMENTS FAIR VALUE DISCLOSURES
The table below sets out the categorisation of the financial instruments held
by the Group at 30 September 2024. Where the financial instruments are held
at fair value the valuation level indicates the priority of the inputs to the
valuation technique. The fair value hierarchy gives the highest priority to
quoted prices in active markets for identical assets or liabilities (Level 1)
and the lowest priority to unobservable inputs (Level 3). Valuations
categorised as Level 2 are obtained from third parties. If the inputs used
to measure fair value fall within different levels of the hierarchy, the
category level is based on the lowest priority level input that is significant
to the fair value measurement of the instrument in its entirety.
Valuation level 30 September 2024 30 September 2023
(unaudited) (unaudited) 31 March 2024
£000 £000 (audited)
£000
Interest rate derivatives liability 2 (1,911) (755) (1,830)
16. RELATED PARTY TRANSACTIONS
Transactions between the Company and its subsidiaries, which are related
parties, have been eliminated on consolidation and are not disclosed in this
note.
AnyJunk Limited
Jim Gibson is a Non-Executive Director and shareholder in AnyJunk Limited.
During the period AnyJunk Limited provided waste disposal services to the
Group on normal commercial terms amounting to £13,000 (2023: £7,000).
London Children's Ballet
The Group signed a Section 106 agreement with Wandsworth Council relating to
the development of our Battersea store, which required the Group to provide
cultural space to Wandsworth Borough Council. In 2021, the Group granted a
twenty year lease over this space to London Children's Ballet at a peppercorn
rent, who in turn have agreed to enter into a Social Agreement with Wandsworth
Borough Council coterminous with the lease. Jim Gibson is the Chairman of
Trustees of the London Children's Ballet. London Children's Ballet rent
storage space from the Group on normal commercial terms, amounting to £2,000
during the period (2023: £2,000).
DS Operations Centre Limited
The Group has invested £0.6 million in DS Operations Centre Limited ("DSOC").
DSOC provided alarm and CCTV monitoring services to the Group under normal
commercial terms during the period, amounting to £191,000 (2023: £154,000).
Treepoints Limited
Jim Gibson is a Non-Executive Director and an investor in City Stasher
Limited, which in turn has a minority investment in Treepoints Limited.
Treepoints Limited provided offsetting tree planting services in respect of
our online packing material sales, under normal commercial terms during the
period, amounting to £1,000 (2023: £1,000).
Ukrainian Sponsorship Pathway UK
Nicholas Vetch and Heather Savory are trustees of a charity called Ukrainian
Sponsorship Pathway UK ("USPUK") to help Ukrainians displaced by the war to
travel to the UK as part of the "Homes for Ukraine" scheme. The charity has
set up offices in Warsaw and Krakow and is one of the few that has been
recognised for this purpose by the UK Government. In the prior period the
Board approved a donation of £50,000 (2024: £nil). In the current period,
the Group has provided free office space to USPUK worth £3,000 (2023: £nil).
Landmark Trust and Ruth Strauss Foundation
Dr Anna Keay is the CEO of the Landmark Trust and Vince Niblett is a Trustee
of the Ruth Strauss Foundation. During the period the Company provided free
storage to the Landmark Trust and the Ruth Strauss Foundation with a total
value of £4,000 (2023: £3,000).
17. CASH FLOW NOTES
a) Reconciliation of profit after tax to cash generated from operations
Note Six months Six months Year
ended ended ended
30 September 30 September 31 March
2024 2023 2024
(unaudited) (unaudited) (audited)
£000 £000 £000
Profit after tax 145,652 119,592 239,833
Taxation 136 20 1,202
Other operating income (1,000) (762) (6,517)
Investment income (93) (17) (45)
Finance costs 9,314 13,228 25,092
Operating profit 154,009 132,061 259,565
Gain on the revaluation of investment properties 14 (82,204) (67,165) (131,159)
Gain on disposal of non-current asset 9a (8,754) - -
Depreciation of plant, equipment, and owner-occupied property 9b 403 433 864
Depreciation of finance lease capital obligations 9a,9b 866 867 1,734
Employee share options 1,169 2,063 4,082
Cash generated from operations pre-working capital movements 65,489 68,259 135,086
Decrease in inventories 5 13 10
Increase in receivables (2,389) (2,704) (1,650)
Increase/(decrease) in payables 8,950 (779) (3,620)
Cash generated from operations 72,055 64,789 129,826
b) Reconciliation of net cash flow to movement in net debt
Six months Six months Year
ended ended ended
30 September 30 September 31 March
2024 2023 2024
(unaudited) (unaudited) (audited)
£000 £000 £000
Net (decrease)/increase in cash and cash equivalents (3,756) (1,260) 1,027
Cash flow from movement in debt financing 29,638 (7,440) 100,159
Change in net debt resulting from cash flows 25,882 (8,700) 101,186
Movement in net debt in the period 25,882 (8,700) 101,186
Net debt at start of period (385,412) (486,598) (486,598)
Net debt at end of period (359,530) (495,298) (385,412)
18. RISKS AND UNCERTAINTIES
The risks facing the Group for the remaining six months of the financial year
are consistent with those outlined in the Annual Report for the year ended 31
March 2024. The risk mitigating factors listed in the 2024 Annual Report are
still appropriate.
The economic outlook remains uncertain, which, along with geo-political
uncertainty, may create economic headwinds in the quarter to December 2024 and
into 2025, which may have an impact on the demand for self storage.
The value of Big Yellow's property portfolio is affected by the conditions
prevailing in the property investment market and the general economic
environment. Accordingly, the Group's net asset value can rise and fall due
to external factors beyond management's control. The uncertainties in the
global economy look set to continue. We have a high-quality prime portfolio of
assets that should help to mitigate the impact of this on the Group.
Self storage is a seasonal business, and we typically lose occupancy in the
December quarter. The new year typically sees an increase in activity,
occupancy, and revenue growth. The visibility we have in the business is
relatively limited at three to four weeks and is based on the net reservations
we have in hand, which are currently in line with our expectations.
There is a risk that our customers may default on their rent payments, however
we have not seen an increase in bad debts since the onset of the pandemic.
We have approximately 75,000 occupied rooms and this, coupled with the
diversity of our customers' reasons for using storage, mean the risk of
individual tenant default to Big Yellow is low. 81% of our customers pay by
direct debit and we take a deposit from all customers. Furthermore, we have
a right of lien over customers' goods, so in the ultimate event of default, we
are able to auction the goods to recover the debts.
19. POST BALANCE SHEET EVENT
Subsequent to the period end, the Group reached a final settlement with its
insurers following the fire at our Cheadle Store in February 2022 receiving a
further £3.1 million of insurance proceeds.
Subsequent to the period end, the expiry of the Group's Revolving Credit
Facility was extended by a year to December 2027.
20. GLOSSARY
Absorption The rate of growth in occupancy assumed within the external property
valuations from the current occupancy level to the assumed stable occupancy
level.
Adjusted earnings The IFRS profit after taxation attributable to shareholders of the Company
excluding investment property revaluations, one-off items of income and costs,
gains/losses on investment property disposals and changes in the fair value of
financial instruments.
Adjusted earnings growth The increase in adjusted eps period-on-period.
Adjusted eps Adjusted profit after tax divided by the diluted weighted average number of
shares in issue during the financial period.
Adjusted NAV EPRA NTA adjusted for an investment property valuation carried out at
purchasers' costs of 2.75%, see note 13.
Adjusted profit before tax The Company's pre-tax EPRA earnings measure with additional Company
adjustments.
APMs Additional performance measures that help financial statement users to better
understand the Group's performance and position.
Average net achieved rent per sq ft Storage revenue divided by average occupied space over the period.
Average occupancy The average space occupied by customers divided by the MLA expressed as a %.
Average rental growth The growth in average net achieved rent per sq ft period-on-period.
BREEAM An environmental rating assessed under the Building Research Establishment's
Environmental Assessment Method.
Cap rates The exit capitalisation rates used in the external investment property
valuation.
Carbon intensity Carbon emissions divided by the Group's average occupied space.
Closing net rent per sq ft Annual storage revenue generated from in-place customers divided by occupied
space at the balance sheet date.
Closing occupancy % The space occupied by customers divided by the MLA at the balance sheet date
expressed as a %.
Closing occupancy sq ft The space occupied by customers at the balance sheet date in sq ft.
Committed facilities Available undrawn debt facilities plus cash and cash equivalents.
Consolidated EBITDA Consolidated EBITDA calculated in accordance with the terms of the Group's
Revolving Credit Facility Agreement.
Debt Long-term and short-term borrowings, as detailed in note 12, excluding finance
leases and debt issue costs.
Earnings per share (eps) Profit for the financial period attributable to equity shareholders divided by
the average number of shares in issue during the financial period.
EBITDA Earnings before interest, tax, depreciation, and amortisation.
EPRA The European Public Real Estate Association, a real estate industry body. This
organisation has issued Best Practice Recommendations with the intention of
improving the transparency, comparability, and relevance of the published
results of listed real estate companies in Europe.
EPRA earnings The IFRS profit after taxation attributable to shareholders of the Company
excluding investment property revaluations, gains/losses on investment
property disposals and changes in the fair value of financial instruments.
EPRA earnings per share EPRA earnings divided by the average number of shares in issue during the
period.
EPRA NTA per share EPRA NTA divided by the diluted number of shares at the period end.
EPRA net tangible asset value (EPRA NTA) IFRS net assets excluding the mark-to-market on interest rate derivatives,
deferred taxation on property valuations where it arises, and intangible
assets. It is adjusted for the dilutive impact of share options.
Equity All capital and reserves of the Group attributable to equity holders of the
Company.
Gross property assets The sum of investment property and investment property under construction.
Gross value added The measure of the value of goods and services produced in an area, industry,
or sector of an economy.
Interest cover The ratio of operating cash flow divided by interest paid (before exceptional
finance costs, capitalised interest, and changes in fair value of interest
rate derivatives). This metric is provided to give readers a clear view of
the Group's financial position.
Like-for-like occupancy Excludes the closing occupancy of new stores acquired, opened, or closed in
the current or preceding financial year in both the current financial year and
comparative figures. This excludes Kings Cross. We previously excluded
Armadillo from the like-for-like occupancy metrics but are now including these
stores to show the occupancy performance of all the Group's like-for-like
trading stores.
Like-for-like store revenue Excludes the impact of new stores acquired, opened or stores closed in the
current or preceding financial year in both the current year and comparative
figures. This excludes Kings Cross.
LTV (loan to value) Net debt expressed as a percentage of the external valuation of the Group's
investment properties.
Maximum lettable area (MLA) The total square foot (sq ft) available to rent to customers.
Move-ins The number of customers taking a storage room in the defined period.
Move-outs The number of customers vacating a storage room in the defined period.
NAV Net asset value.
Net debt Gross borrowings less cash and cash equivalents.
Net initial yield The forthcoming year's net operating income expressed as a percentage of
capital value, after adding notional purchaser's costs.
Net operating income Store EBITDA after an allocation of central overhead.
Net operating income on stabilisation The projected net operating income delivered by a store when it reaches a
stable level of occupancy.
Net promoter score The Net Promoter Score is an index ranging from -100 to 100 that measures the
willingness of customers to recommend a company's products or services to
(NPS) others. The Company measures NPS based on surveys sent to all its move-ins
and move-outs.
Net Renewable Energy Positive Big Yellow's strategy is that by 2030 the Group will generate as much
renewable energy as it is able to across its store portfolio and meet any
remaining Scope 1 and Scope 2 emissions via the retirement of REGOs from
offsite energy generation.
Net rent per sq ft Storage revenue generated from in place customers divided by occupancy.
Net Zero Strategy The Group's published strategy to have Net Zero Scope 1, 2 and 3 Emissions.
Non like-for-like stores Stores excluded from like-for-like metrics, as they were acquired, opened or
closed in the current or preceding financial year. In the current period
this includes Kings Cross.
Occupancy The space occupied by customers divided by the MLA expressed as a % or in sq
ft.
Occupied space The space occupied by customers in sq ft.
Other storage related income Packing materials, insurance/enhanced liability service and other storage
related fees.
Pipeline The Group's development sites.
PPC Pay-per-click marketing spend.
Property Income Distribution (PID) A dividend, generally subject to withholding tax, that a UK REIT is required
to pay from its tax-exempt property rental business, and which is taxable for
UK-resident shareholders at their marginal tax rate.
REGO Renewable Energy Guarantees of Origin.
REIT Real Estate Investment Trust. A tax regime which in the UK exempts
participants from corporation tax both on UK rental income and gains arising
on UK investment property sales, subject to certain conditions.
REVPAF Total store revenue divided by the average maximum lettable area in the
period.
Store EBITDA Store earnings before interest, tax, depreciation, and amortisation.
Store revenue Revenue earned from the Group's open self storage centres.
TCFD Task Force on Climate Related Financial Disclosure.
Total shareholder return (TSR) The growth in value of a shareholding over a specified period, assuming
dividends are reinvested to purchase additional units of shares.
INDEPENDENT REVIEW REPORT TO BIG YELLOW GROUP PLC
Conclusion
We have been engaged by Big Yellow Group PLC ("the Group") to review the
condensed set of financial statements in the half-yearly financial report for
the six months ended 30 September 2024 which comprises the Condensed
Consolidated Statement of Comprehensive Income, Condensed Consolidated Balance
Sheet, Condensed Consolidated Statement of Changes in Equity, Condensed
Consolidated Cash Flow Statement, and the related explanatory notes.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 September 2024 is not prepared,
in all material respects, in accordance with IAS 34 Interim Financial
Reporting as adopted for use in the UK and the Disclosure Guidance and
Transparency Rules ("the DTR") of the UK's Financial Conduct Authority ("the
UK FCA").
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410 Review of Interim Financial Information Performed by the
Independent Auditor of the Entity ("ISRE (UK) 2410") issued for use in the UK.
A review of interim financial information consists of making enquiries,
primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures. We read the other
information contained in the half-yearly financial report and consider whether
it contains any apparent misstatements or material inconsistencies with the
information in the condensed set of financial statements.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and consequently does not enable
us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an
audit opinion.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention that causes us to believe that the directors
have inappropriately adopted the going concern basis of accounting, or that
the Directors have identified material uncertainties relating to going concern
that have not been appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410. However, future events or conditions may cause the Group to
cease to continue as a going concern, and the above conclusions are not a
guarantee that the Group will continue in operation.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the Directors. The Directors are responsible for preparing the
half-yearly financial report in accordance with the DTR of the UK FCA.
As disclosed in note 1, the latest annual financial statements of the Group
are prepared in accordance with UK-adopted international accounting standards.
The Directors are responsible for preparing the condensed set of financial
statements included in the half-yearly financial report in accordance with IAS
34 as adopted for use in the UK.
In preparing the condensed set of financial statements, the Directors are
responsible for assessing Group's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the Directors either intend to
liquidate the Group or to cease operations, or have no realistic alternative
but to do so.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review. Our conclusion, including our conclusions relating to going concern,
are based on procedures that are less extensive than audit procedures, as
described in the Basis for conclusion section of this report.
The purpose of our review work and to whom we owe our responsibilities
This report is made solely to the Group in accordance with the terms of our
engagement to assist the Group in meeting the requirements of the DTR of the
UK FCA. Our review has been undertaken so that we might state to the Group
those matters we are required to state to it in this report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company for our review work, for this
report, or for the conclusions we have reached.
Anna Jones
for and on behalf of KPMG LLP
Chartered Accountants
2 Forbury Place
33 Forbury Road
Reading
RG1 3AD
18 November 2024
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