Investors cheered Safestore's (SAFE) decision to convert into a real-estate investment trust (Reit), which pushed the shares up 4 per cent on the morning these full-year figures appeared. From 1 April, the self-storage company will pay no tax on its profits, provided it distributes 90 per cent of its UK rental income.
This news provided a welcome distraction from figures that were impacted by last October's introduction of VAT on self storage. The occupancy rate at Safestore's mature stores fell from 68.8 per cent on 31 October 2011 to 66.7 per cent a year later as customers reacted to price increases. That will feed through into revenues and profits in the current year - chief executive Peter Gowers expects both to be lower. The other consequence of the new tax rule was to cut the portfolio valuation by £39.2m or 4 per cent. That explains the big plunge in reported profits, and it also hit the group's adjusted book value, which fell 10.7 per cent to 189p a share.
Underlying cash profits were roughly flat at £50.3m. Revenues rose 5.5 per cent on a constant currency basis, but costs were also higher. Mr Gowers launched an investment programme last year to strengthen the group's consumer brand, improve the website, including more flexible pricing, and target national businesses more effectively.
Broker Espirito Santo expects adjusted EPS of 9.4p for 2013 (from 10.6p in 2012).
SAFESTORE HOLDINGS (SAFE) | ||||
|---|---|---|---|---|
| ORD PRICE: | 122p | MARKET VALUE: | £229m | |
| TOUCH: | 121-122p | 12-MONTH HIGH: | 129p | 98p |
| DIVIDEND YIELD: | 4.6% | PE RATIO: | na | |
| NET ASSET VALUE: | 129p | NET DEBT: | 162% | |
| Year to 31 Oct | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 82.9 | 14.9 | 6.70 | 4.65 |
| 2009 | 84.4 | -9.4 | -0.10 | 4.65 |
| 2010 | 89.2 | 29.2 | 14.1 | 4.95 |
| 2011 | 95.1 | 8.55 | 6.95 | 5.30 |
| 2012 | 98.8 | -19.5 | -4.16 | 5.65 |
| % change | +4 | - | - | +7 |
Ex-div: 13 Mar Payment: 12 Apr | ||||
