REG - Big Yellow Group PLC - Trading Statement

Big YellowAnnouncement

17/01/2025 07:00

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RNS Number : 6608T  Big Yellow Group PLC  17 January 2025

17 January 2025

 

Big Yellow Group PLC

("Big Yellow" or "the Group")

 

Trading Statement

 

Big Yellow is pleased to provide the following update on trading for the third
quarter ended 31 December 2024.

 Financial metrics                                         Quarter ended      Quarter ended

31 December 2024
31 December 2023

                                                                                                 Change
 Total revenue for the quarter                             £51.4 million      £50.5 million      2%
 Like-for-like store revenue for the quarter((1))          £50.4 million      £49.6 million      2%
 Total revenue for the year to date                        £154.4 million     £150.1 million     3%
 Like-for-like store revenue for the year to date((1))     £151.4 million     £147.7 million     3%
 Store metrics - all 109 stores
 Store Maximum Lettable Area ("MLA")                       6,421,000          6,419,000          -
 Closing occupancy (sq ft)                                 4,988,000          4,979,000          -
 Occupancy change in quarter                               (180,000 sq ft)    (249,000 sq ft)    69,000 sq ft
 Closing occupancy                                         77.7%              77.6%              0.1 ppt
 Closing occupancy - like-for-like stores((1))             78.1%              78.4%              (0.3 ppts)
 Average achieved net rent per sq ft for the quarter       £34.87             £34.00             3%
 Average achieved net rent per sq ft for the year to date  £34.53             £33.34             4%
 Closing net rent per sq ft                                £35.26             £34.65             2%

(1)   Excluding Kings Cross (opened June 2023)

 

In our seasonally weaker third quarter, occupancy across all 109 stores
decreased by 180,000 sq ft, a significant improvement of 69,000 sq ft on last
year's loss of 249,000 sq ft.

Overall move-ins for the quarter were up 2%, with business move-ins up 9%,
compared to the same quarter last year.

Closing occupancy was 77.7%, an increase of 0.1 ppt from 77.6% last year.
Like-for-like closing occupancy was 78.1%, a decrease of 0.3 ppts from the
same time last year, and an improvement of 1.5 ppts from 30 September 2024.

Closing net achieved rent per sq ft for all stores was £35.26, an increase of
2% from the same time last year, with average rate up 3% on the same quarter
last year, and up 4% for the year to date.

The Group's revenue increased by 2% in the quarter, and is up 3% for the year.

Like-for-like operating expenses for the quarter were up 6% on the same
quarter last year, an improvement from the 10% increase reported in the first
half of the year and we expect this to further decline to 3% to 4% annualised
for the next financial year.

We estimate that the impact of the increase in National Insurance from April
announced in the Budget will be £0.5 million for next year.  We are
mitigating this increase in full through additional reductions in store
headcount - a dividend of continued investment in automation.

We reported for the half year to 30 September 2024 that adjusted profit before
tax was up 3%, with adjusted earnings per share ("eps") down 3% as a result of
the dilutive impact of the prior year placing in October 2023.  For the nine
months to 31 December 2024, unaudited adjusted eps is up 1.5% with the
dilution having washed through and as we are now close to the end of this
financial year, we can be confident in seeing some further modest eps growth
improvement for the full year.

 

Jim Gibson, Chief Executive Officer, commented:

"Events beyond our control, including policy making, are not making the job of
running businesses any easier; nonetheless we are confident that this business
will continue to prove itself resilient even if not completely immune from
these challenges.

A return to adjusted eps growth for the first nine months of the financial
year is encouraging and will subsist for the full year. We are now turning our
attention to our next financial year where we expect to see a continuing
moderation in operating cost inflation.  Self-evidently the macro-economic
environment is adding to volatility, and therefore it remains to be seen
whether that will negatively impact the improvements in trading we have seen
more recently.

This, in our view, is not a moment to be carrying too much debt, and
accordingly we remain focused on maintaining our net debt to EBITDA ratio,
which is currently 3 times, within our target range of 3 to 4 times.

We expect to invest approximately £176 million over the next three years
building out the next nine consented stores (MLA of 0.7 million sq ft) and we
believe this can be funded comfortably from existing resources with our net
debt to EBITDA remaining within our target range.  We are confident that
these prime new store openings, which break even at 20 to 25% occupancy, will
make a significant contribution to future cash flow and earnings growth."

 

For further information, please contact:

 

Big Yellow Group
PLC
            +44 (0)1276 477 811

Nicholas Vetch CBE, Executive Chairman

Jim Gibson, Chief Executive Officer

John Trotman, Chief Financial Officer

 

Sodali & Co
 
      +44 (0)20 7250 1446

Ben Foster

Courtney Sanford

 

Notes to Editors

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. 

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