Big Yellow has reported a stronger-than-expected hike in occupancy in its half-year results released this morning.
The self-storage group said occupancy growth was 250,000 sq ft across all stores in the six-month period ended 30 September compared with 209,000 sq ft last year.
This reflects an increase from 59.3% in March to 63.9% at the end of September.
Its adjusted NAV edged up by 1.7% to 457.5p a share, as store revenue for the six months rose by 7.4% to £31.9m from March and up 6.6% from the same six months last year.
Total revenue increased by 4.9% compared with the same period last year. The company said the rise was lower than that of store revenue, reflecting a decline in income from development sites, notably at Chiswick, where it has commenced construction of a “landmark” store.
After adjusting the pretax profit of £6.4m for gains on the revaluation of investment properties and fair value losses on interest rate derivatives, the group made an adjusted profit before tax in the period of £11.6m, up by 20% from £9.7m for the same period last year.
The group delivered an adjusted profit before tax of £11.6m, up by 20% on the same time last year, while its diluted EPRA earnings per share were up by 20% to 8.93p.
Executive chairman Nicholas Vetch said: “In what is our seasonally strongest period, we have delivered a solid performance, with improved occupancy growth across the portfolio compared with the same period last year.
“This performance has been pleasing, particularly in light of the continuing pressures on the consumer and muted economic environment coupled with the historically low level of housing activity.
“We have clearly been assisted by our strong brand position, in particular online, and the focus of our stores in London and the South East, where overall revenue growth per store outperformed the rest of the portfolio. This performance demonstrates the relative resilience of this emerging sector, where new supply has slowed to a trickle and awareness of the product continues to grow.
“Recessions can serve as useful spurs to companies in improving their businesses and we believe that Big Yellow is a significantly better business than it was in 2007, at the start of the financial crisis.
“This is reflected in our branding, customer service, internet presence and operating systems. These, combined with our highly visible purpose-built stores and London presence, all assist in our drive for cash flow.”
bridget.oconnell@estatesgazette.com
