Safestore’s (SAFE) new chief executive Frederic Vecchioli was appointed less than five months ago, but has already made an impact, as the UK’s largest self-storage group recovers from the imposition of VAT on self-storage rental income in October 2012. He has started the ball rolling with an 18.59m share placing that raised £32.5m at a 2 per cent premium to the previous closing price. This will help cut the loan-to-value ratio from 50 per cent to 40 per cent and give an annual saving of £4m in finance costs.
Debt has also been reduced by the sale of the group’s Whitechapel site for £41.1m - a £14.6m premium over book value. The site will still be used until November 2015 under a leaseback agreement at a peppercorn rent. The group also completed its conversion to Reit status, resulting in a one-off net tax rebate of £59.9m, which accounts for the high reported EPS figure.
Revenue was down 6.2 per cent in the UK, but this was offset to some extent by a robust performance from the French operation, where revenue grew by 4.8 per cent to €30.7m (£25.3m). Safestore is currently operating on 65.3 per cent capacity, so there is room to improve rental income without any material increase in the cost base. Peel Hunt has upgraded its current-year EPS estimate from 11.9p to 12.5p.
| SAFESTORE HOLDINGS (SAFE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 184p | MARKET VALUE: | £346m | |
| TOUCH: | 184-185p | 12-MONTH HIGH: | 185p | LOW: 106p |
| DIVIDEND YIELD: | 3.1% | PE RATIO: | 3 | |
| NET ASSET VALUE: | 184p | NET DEBT: | 111% | |
| Year to 31 Oct | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 84.4 | -9.4 | -0.1 | 4.65 |
| 2010 | 89.2 | 29.2 | 14.1 | 4.95 |
| 2011 | 95.1 | 8.6 | 6.95 | 5.30 |
| 2012 | 98.8 | -19.5 | -4.20 | 5.65 |
| 2013 | 96.1 | 48.6 | 57.8 | 5.75 |
| % change | -3 | - | - | +2 |
Ex-div:12 Mar Payment:11 Apr | ||||
