Company Announcements

22 July 2021

Big Yellow Group PLC ("Big Yellow" or "the Group")

Trading Statement

The Board of Big Yellow Group PLC, the UK's brand leader in self storage, is pleased to provide the following update on trading for the first quarter ended 30 June 2021. 

Results

(1)   Excluding Camberwell (opened July 2020), Bracknell (opened September 2020), Battersea (opened November 2020) and Uxbridge (opened June 2021).

The 79 Big Yellow stores increased in occupancy over the quarter by 289,000 sq ft (5.8 ppts of the MLA) resulting in a closing occupancy of 90.1% (2020: 83.6%).  Like-for-like closing occupancy was 92.9%.

The table below shows the change in occupancy by customer type over the quarter:

The growth in occupancy this quarter was significantly ahead of last year, which in itself was greater than the 125,000 sq ft growth delivered in 2019, following a strong recovery once restrictions began to ease in mid-May 2020.

We saw strong demand from domestic customers in the quarter, in part due to the stamp duty holiday tapering off from 1 July.  This resulted in an acceleration of housing-related demand in June. We also saw a higher than expected pick-up in student demand in June with similar growth for the quarter to that seen last year but down from the 73,000 sq ft in 2019.  June is usually our strongest month in the first quarter, and this year it had a record gain of 275,000 sq ft. 

Some of this occupancy growth from both the housing and student sectors is relatively short term, and we expect the current quarter to be impacted by these customers moving out.  In addition, there will be customers who sold their properties several months ago, who have now successfully acquired a new property prior to the 30 June deadline and have moved out in early July.  There has been an increase in move-outs in July to date above normal levels, although this is now normalising, with current notices to move out in line with 2019, and reservations building again.  The current like-for-like occupancy of the Big Yellow portfolio is 91.0% and we have returned to occupancy growth. 

We continue to see demand from businesses with occupancy increasing over the quarter and in July to date.  As explained previously, we expect our third quarter to revert to our normal seasonal loss in occupancy before we return to growth in the fourth quarter.  

As the stores are now at higher levels of occupancy, we are seeing improving growth in net rent per sq ft.  The Group's average achieved net rent per sq ft increased by 2.7% compared to the same quarter last year, with closing net rent up 3.5% compared to 30 June 2020. 

The Group's like-for-like store revenue increased by 13.8% compared to the same quarter last year, mostly driven by occupancy growth, but with a contribution from year-on-year growth in average net rent and ancillary sales.

Armadillo

Our regional portfolio of 25 stores also delivered significant outperformance in the quarter, with growth in occupancy of 66,000 sq ft (up 6.4 ppts from 31 March 2021).   

The occupancy of the Armadillo portfolio at 30 June 2021 was 90.2% (30 June 2020: 78.2%).  Revenue from the portfolio for the quarter to 30 June 2021 increased by 21% to £5.0 million compared to the same quarter last year.  The portfolio saw a loss in occupancy in the initial weeks of July, but has also now returned to growth, with a growing book of reservations.  The current occupancy is 88.4%.

Development

The Group's new 54,000 sq ft store in Uxbridge, London opened on 28 June, and we will update on its early trading at the half year.  We are currently on site constructing our new stores in Hayes, Hove, Harrow, Kings Cross and Kingston North.

In April, the Group acquired a prime 0.9 acre site on Regis Road in Kentish Town, North London for £16.5 million.  We will be seeking planning permission for a 68,000 sq ft self storage centre on the site.  The site is centrally located site in Zone 2 and is a high quality addition to the Group's development pipeline.

In June the Group acquired 66 Hammersmith Road, West Kensington, in London for £26 million.  This is a strategic acquisition adjacent to the Olympia conference centre, a short distance from one of the wealthiest and densest enclaves in London.  Subject to planning, the store is currently estimated to open in early 2025, and will provide approximately 175,000 sq ft of space, including 7,000 sq ft of SME space.  The total development cost, including land acquisition, is estimated to be £73 million, with an expected NOI at stabilisation of £5.8 million or 7.9% on cost.  West Kensington, when fully constructed and opened, will represent our largest capital investment in an individual store to date. 

Jim Gibson, Chief Executive Officer, commented:

"We are pleased to have delivered a strong trading performance in the first quarter and we have now achieved our long-held goal of like-for-like occupancy of 90%.  However, we would caution that this is during our normally strong summer trading period, short term uncertainties remain, and we do expect a return to more normal seasonal trading patterns over the remainder of the year.

We successfully raised £100 million from our shareholders by way of a placing in June, which allowed us to continue to invest in future growth through the recent strategic acquisitions.  These, along with our existing development pipeline, have the potential to generate in excess of £40 million of net operating income over the short to medium term, and in so doing create significant value for our shareholders." 

For further information, please contact:

Big Yellow Group PLC                                                                                                                        01276 477 811

Nicholas Vetch, Executive Chairman

Jim Gibson, Chief Executive Officer

John Trotman, Chief Financial Officer

Teneo                                                                                                                                        0203 603 5221

Ben Foster                       

Matthew Denham

Notes to Editors 

Big Yellow is the UK's brand leader in self storage.  Big Yellow now operates from a platform of 104 stores, including 25 stores branded as Armadillo Self Storage.  We own a further 14 Big Yellow self storage development sites of which seven have planning consent.  The current maximum lettable area of the existing platform (including Armadillo) is 6.1 million sq ft.  When fully built out the portfolio will provide approximately 7.2 million sq ft of flexible storage space.  98% of our stores and sites by value are held freehold and long leasehold, with the remaining 2% short leasehold.

The Group has pioneered the development of the latest generation of self storage facilities, which utilise state of the art technology and are located in high profile, accessible, main road locations.  Our focus on the location and visibility of our Big Yellow stores, with excellent customer service, a market-leading online platform, and significant and increasing investment in sustainability, has created the most recognised brand name in the UK self storage industry.