Adjusted cash earnings were up by 3.1 per cent to £6.49m for Lok’nStore (LOK) in the 12 months to June 2017, provided you strip out exceptional items such as the gain from the sale of the old Reading store in the previous year. Growing consumer awareness of the self-storage sector helped to lift like-for-like occupancy by 6.5 per cent, while unit pricing grew a more modest 0.8 per cent.
To cater for increasing demand, there is a current pipeline of seven new stores, which will increase storage space by 26.1 per cent. Four more are moving through the legal process.
Finances were considerably strengthened by the sale of all of the shares Lok'nStore held in treasury. A total of 2.46m shares were sold at an average price of 405p, against an original average purchase cost of 152p a share, thus raising £9.9m. This was used to pay down debt, which alongside an increase in the value of the portfolio helped to reduce the loan-to-value ratio to a modest 14 per cent.
Lok’nStore also manages seven stores for third-party owners, receiving a standard monthly fee and a performance fee. This generates a revenue stream with no capital costs, so the opening of an additional third-party store in 2017 and a further three in 2018 is encouraging.
| LOK'NSTORE (LOK) | ||||
| ORD PRICE: | 377.5p | MARKET VALUE: | £111m | |
| TOUCH: | 370-385p | 12M HIGH | 490p | LOW: 348p |
| DIVIDEND YIELD: | 2.6% | DEVELOPMENT STOCK: | £5.1m | |
| DISCOUNT TO NAV: | 9% | |||
| INVEST PROPERTIES: | £97.8m | NET DEBT: | 20% | |
| Year to 30 Jun | Net asset value (p)* | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2013 | 248 | 1.4 | 5.8 | 6 |
| 2014 | 271 | 0.4 | 0.8 | 7 |
| 2015 | 302 | 2.7 | 7.8 | 8 |
| 2016 | 386 | 5.5 | 16.6 | 9 |
| 2017 | 416 | 4.0 | 11.0 | 10 |
| % change | +8 | -28 | -34 | +11 |
| Ex-div | 30 Nov | |||
| Payment: | 10 Jan | |||
| *Adjusted net asset value | ||||
