Increased revenue and profit leads Big Yellow to raise occupancy targets
Self-storage firm Big Yellow increased its full-year occupancy targets on Tuesday after posting a rise in both profit and revenue in the six months leading to 30 September.
Revenue grew 6% to £58.1m in the first half as occupancy grew from 79% to 84%, falling just shy of the 85% target laid out by management at the end of its last financial year.
Like-for-like revenue also increased 6% to £57.1m.
The growth in revenue pushed pre-tax profit ahead to £78.7m, a 36% year-on-year improvement, and although Big Yellow noted that the second half of the year had historically been weaker than the first, it still expected to beat the 85% target next summer and in fact increased it to 90%.
Throughout the half, EBITDA rose 8% to £39.7m as the group closed the period on an average rent of £26.02 per square foot.
Executive chairman Nicholas Vetch said, "Over the long term, we are confident that the existing platform will continue to deliver attractive returns. That said, adding more capacity will improve those returns.
"The expeditious way of doing that would be to acquire existing freehold self-storage assets in London and other large conurbations in the UK. However, there are few self-storage centres that meet our quality criteria and for those that do exist, they are generally not for sale. Furthermore, as stated previously, we have no interest in expanding abroad."
"We will, therefore, continue to develop the Big Yellow platform organically, site by site. This does involve risk and requires patience, but it will allow us to expand and improve our unique and irreplaceable portfolio," Vetch added.
Earnings per share advanced 36% to 50p as Big Yellow announced an interim dividend per share of 15.3p, 13% up from the 13.5p per share it paid out at the same time twelve months earlier.
As of 1000 GMT, shares had advanced 1.05% to 773.00p.