REG-SEGRO PLC SEGRO plc Trading Update

SEGROAnnouncement

26/09/2024 07:15

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SEGRO plc Trading Update

 

SEGRO plc (“SEGRO” or the “Group”) (BOURSE:SGRO) today announces a
trading update, relating to the period to 31 August 2024, to coincide with the
publication of the Tritax EuroBox Scheme document in connection with the
Group’s Recommended Offer for Tritax EuroBox plc.

David Sleath, Chief Executive, said:

“Our business is performing well as we head into the final months of the
year. The overall balance of supply and demand in our occupier markets remains
favourable and we continue to make good progress in capturing the significant
embedded reversion within our portfolio.

“We are seeing liquidity return to investment markets and we continue to
identify attractive opportunities to deploy capital both through asset
acquisitions and into our profitable development pipeline, utilising our
exceptional land bank.

“Our prime urban and big box portfolio, market-leading operating platform
and strong balance sheet position us well to deliver strong returns from our
existing portfolio and capitalise on new opportunities, supporting attractive
and compounding increases in both earnings and dividends. This provides us
confidence in the outlook for the remainder of the year and beyond.”

KEY HIGHLIGHTS(12):


 * £58 million of new headline rent signed so far in 2024, ahead of the
equivalent period last year and positioning SEGRO for another year of strong
rent roll growth. This includes £21 million of uplifts from rent reviews,
renewals and indexation, reflecting a 30 per cent average increase at lease
events, and £17 million of pre-let signings.

 * Portfolio continues to deliver strong operating metrics: customer retention
remains high at 83 per cent and occupancy is broadly unchanged since 30 June
2024 at 94.3 per cent.

 * Profitable development programme expected to add £48 million of future rent
through projects currently onsite and in advanced negotiations (including a
further data centre in Slough). 63 per cent of this is pre-let and the average
yield on cost is 7.8 per cent.

 * Driving portfolio outperformance through disciplined capital allocation. £239
million of acquisitions and £311 million of development capex year to date,
offset by £500 million of disposals above book value. The Group maintains its
expectation to invest c.£500 million of development capex during 2024 and has
a further c.£200 million of asset disposals under offer.

 * Balance sheet remains in a strong position to pursue further growth
opportunities with LTV of 29 per cent(3) and £2.1 billion of cash and undrawn
committed facilities. A €500 million, 8-year bond was issued in September at
an attractive 3.5 per cent coupon, demonstrating SEGRO’s ability to access
capital markets in an agile manner, while keeping the cost of funding low
(average cost of debt post the issuance is 2.6 per cent).

 * Recommended all-share offer for Tritax EuroBox plc announced on 4 September
2024 and expected to close in Q4 2024.

1( )In this statement, space is stated at 100 per cent, whilst financial
figures are stated reflecting SEGRO’s share of joint ventures. Operational
and financial figures are stated for the period to, or at, 31 August unless
otherwise indicated and the exchange rate applied is €1.19:£1.

2 Headline rent is annualised gross passing rent receivable once incentives
such as rent-free periods have expired.

3 Based on values as at 30 June 2024, adjusted for acquisitions, disposals and
other capital expenditure in July/ August.

Financial calendar

This update replaces our Q3 2024 Trading Update originally planned for 17
October 2024. The date for SEGRO’s full year results for the year ended 31
December 2024 (provisionally set for 14 February 2025) will remain under
review pending the Recommended Offer for Tritax EuroBox plc.

This Trading Update, the most recent Annual Report and other information are
available on the SEGRO website at www.segro.com/investors
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.segro.com%2Finvestors&esheet=54127166&newsitemid=20240925976778&lan=en-US&anchor=www.segro.com%2Finvestors&index=1&md5=a58f3157071ad921ab86aa25f4aa93ac)
.

About SEGRO

SEGRO is a UK Real Estate Investment Trust (REIT), listed on the London Stock
Exchange and Euronext Paris, and is a leading owner, manager and developer of
modern warehouses and industrial property. It owns or manages 10.8 million
square metres of space (116 million square feet) valued at £20.6 billion as
at 30 June 2024, serving customers from a wide range of industry sectors. Its
properties are located in and around major cities and at key transportation
hubs in the UK and in seven other European countries.

For over 100 years SEGRO has been creating the space that enables
extraordinary things to happen. From modern big box warehouses, used primarily
for regional, national and international distribution hubs, to urban
warehousing located close to major population centres and business districts,
it provides high-quality assets that allow its customers to thrive.

A commitment to be a force for societal and environmental good is integral to
SEGRO’s purpose and strategy. Its Responsible SEGRO framework focuses on
three long-term priorities where the company believes it can make the greatest
impact: Championing Low-Carbon Growth, Investing in Local Communities and
Environments and Nurturing Talent.

Striving for the highest standards of innovation, sustainable business
practices and enabling economic and societal prosperity underpins SEGRO’s
ambition to be the best property company.

See www.SEGRO.com
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.SEGRO.com&esheet=54127166&newsitemid=20240925976778&lan=en-US&anchor=www.SEGRO.com&index=2&md5=fe35d34279e04e0b6bece49d5ffdfbd0)
for further information.

Forward-Looking Statements: This announcement contains certain forward-looking
statements with respect to SEGRO's expectations and plans, strategy,
management objectives, future developments and performance, costs, revenues
and other trend information. All statements other than historical fact are, or
may be deemed to be, forward-looking statements. Forward-looking statements
are statements of future expectations and all forward-looking statements are
subject to assumptions, risk and uncertainty. Many of these assumptions, risks
and uncertainties relate to factors that are beyond SEGRO's ability to control
or estimate precisely and which could cause actual results or developments to
differ materially from those expressed or implied by these forward-looking
statements. Certain statements have been made with reference to forecast
process changes, economic conditions and the current regulatory environment.
Any forward-looking statements made by or on behalf of SEGRO are based upon
the knowledge and information available to Directors on the date of this
announcement. Accordingly, no assurance can be given that any particular
expectation will be met and you are cautioned not to place undue reliance on
the forward-looking statements. Additionally, forward-looking statements
regarding past trends or activities should not be taken as a representation
that such trends or activities will continue in the future. The information
contained in this announcement is provided as at the date of this announcement
and is subject to change without notice. Other than in accordance with its
legal or regulatory obligations (including under the UK Listing Rules and the
Disclosure Guidance and Transparency Rules of the Financial Conduct
Authority), SEGRO does not undertake to update forward-looking statements,
including to reflect any new information or changes in events, conditions or
circumstances on which any such statement is based. Past share performance
cannot be relied on as a guide to future performance. Nothing in this
announcement should be construed as a profit estimate or profit forecast. The
information in this announcement does not constitute an offer to sell or an
invitation to buy securities in SEGRO plc or an invitation or inducement to
engage in or enter into any contract or commitment or other investment
activities. Neither the content of SEGRO's website nor any other website
accessible by hyperlinks from SEGRO's website are incorporated in, or form
part of, this announcement.

CONTACT DETAILS FOR INVESTOR / ANALYST AND MEDIA ENQUIRIES:

SEGRO

Soumen Das (Chief Financial Officer) Tel: +44 (0) 20 7451 9110

Claire Mogford (Head of Investor Relations) Tel: +44 (0) 20 7451 9048

Gary Gaskarth (External Communications Manager) Tel: +44 (0) 20 7451 9069

FTI Consulting

Richard Sunderland / Eve Kirmatzis Tel: +44 (0) 20 3727 1000



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