Shares in Segro (SGRO) have risen in value by more than 40 per cent over the past year. The group, which develops and manages warehouses, has been flying high on the rise of e-commerce and growing urban areas - which is "really where the action happens", according to chief financial officer Soumen Das.
Yet there are concerns that the sector, once under-supplied due to the lack of development following the 2008 crisis, is now beginning to mature. But this year the company reported that the like-for-like value of its portfolio, driven primarily by growth in continental Europe, is up by 13.5 per cent.
"There is still very good performance in the UK, but with fireworks more on the continent - they're playing catch up," said Mr. Das, who cited rising e-commerce penetration rates in France and Germany where retailers will soon need to adapt their supply chains to omni-channel delivery models.
On home turf, Segro's performance was steady: like-for-like net rental income in the UK rose by 5.7 per cent. Total net rental income was up 13.6 per cent to £281.3m from £247.6m last year, which management attributed in part to investment activity and development completions. The group noted that 2019 was its record year for completions and has invested £692m in its portfolio, with total development capex for 2020 again expected to exceed £600m.
Analysts at Panmure Gordon expect adjusted NAV of 736p a share at the December 2020 year end.
| SEGRO (SGRO) | ||||
| ORD PRICE: | 931p | MARKET VALUE: | £10.2bn | |
| TOUCH: | 931-932p | 12-MONTH HIGH: | 945p | LOW: 634.4p |
| DIVIDEND YIELD: | 2.2% | TRADING PROP: | £20.2m | |
| PREMIUM TO NAV: | 33% | |||
| INVESTMENT PROP: | £9.5bn* | NET DEBT: | 24% | |
| Year to 31 Dec | Net asset value (p) | Pre-tax profit (£bn) | Earnings per share (p) | Dividend per share (p) |
| 2015** | 449 | 0.69 | 88.0 | 15.0 |
| 2016** | 480 | 0.43 | 51.6 | 15.7 |
| 2017 | 554 | 0.98 | 98.5 | 16.6 |
| 2018 | 648 | 1.10 | 105 | 18.8 |
| 2019 | 700 | 0.90 | 79.3 | 20.7 |
| % change | +8 | -18 | -25 | +10 |
| Ex-div: | 19 Mar | |||
| Payment: | 01 May | |||
| *Includes £1.12bn investments in joint ventures **Previous figures adjusted for one-for-five rights issue in March 2017 | ||||
