It was a tough year for Big Yellow (BYG), which was forced to reduce margins while hiking the prices it offers to consumers when VAT on self-storage services was made compulsory last October. But, to managements's credit, that's not immediately obvious from these full-year results.
Adjusted profits, which strip-out last year’s VAT-related property write-downs, grew 8 per cent to £25.5m. That’s partly because the company opened a new store in Chiswick, and partly because growth in occupancy and prices was sufficiently strong in the first half to offset the impact of VAT on the second. Chairman Nick Vetch says the current year is likely to be similar, with a poor year-on-year performance in the first half before the tough pre-VAT comparatives disappear in the second.
As well as trying to deal with the VAT problem, Big Yellow's management spent the year overhauling its balance sheet. It got a £100m loan from Aviva for 15 years at 4.9 per cent, and also signed four-year refinancing deals for £190m with three high-street banks. Finally, it raised £37m of equity in January at 370p. "We’re a lot less frightened than at any point since 2007" as a result, says Mr Vetch.
Broker Investec Securities expects adjusted pre-tax profit of £27.9m for 2014, giving EPS of 19.7p (2013: 19.3p).
BIG YELLOW (BYG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 414p | MARKET VALUE: | £585m | |
| TOUCH: | 413-415p | 12-MONTH HIGH: | 430p | LOW: 275p |
| DIVIDEND YIELD: | 2.7% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 396p | NET DEBT: | 42% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2009 | 58.5 | -71.5 | -62.9 | nil |
| 2010 | 58.0 | 10.2 | 8.10 | 4.00 |
| 2011 | 61.9 | 6.90 | 5.30 | 9.00 |
| 2012 | 65.7 | -35.6 | -27.7 | 10.0 |
| 2013 | 69.7 | 31.9 | 24.4 | 11.0 |
| % change | +6 | - | - | +10 |
Ex-div: 12 Jun Payment: 24 Jul | ||||
