Big Yellow's (BYG) first-half revenues were slightly lower than last year, but that simply reflected the residual impact of the Treasury's decision to introduce VAT on self-storage services in October 2012. Business has bounced back this year, partly thanks to a recovering housing market.
One indictor of this rebound is the occupancy rate of its 32 established stores - those it has owned as a portfolio since 2007. The rate plunged from 77 per cent to 72.8 per cent in the six months to March as prices rose to absorb VAT, only to recover to 77.1 per cent by September. In October - the first month in which the tax distortion falls out of the year-on-year comparisons - revenues were up 5.1 per cent.
Adjusted profits were 2 per cent higher than last year at £14.2m, but that's mainly because the company replaced debt with equity in January by issuing shares to institutional investors. The loan-to-value ratio is now just 29 per cent, but chairman Nick Vetch wants to reduce it even further, having commissioned consultants to show that lower gearing improves long-term performance for real-estate investment trusts.
Broker Peel Hunt expects adjusted EPS of 20.1p and a dividend of 16.1p for the full-year (from 19.3p and 11p in 2013).
BIG YELLOW (BYG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 469p | MARKET VALUE: | £663m | |
| TOUCH: | 468-469p | 12-MONTH HIGH: | 491p | LOW: 318p |
| DIVIDEND YIELD: | 3.0% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 414p | NET DEBT: | 39% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 36.2 | 27.2 | 21.2 | 5.0 |
| 2013 | 35.9 | 34.5 | 24.7 | 8.0 |
| % change | -1 | +27 | +17 | +60 |
Ex-div: 11 Dec Payment: 8 Jan | ||||
