Safestore Holdings Plc, Annual Report and Financial Statements 2012
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Safestore Holdings plc Annual report and financial statements 2012 Safestore the things you love Market leaders in self-storage With 123 stores, Safestore and Une Pièce en Plus are the self-storage market leaders in the UK and Paris. Safestore Holdings plc Annual report and financial statements 2012 Overview Overview Business review Financial statements Headlines 02 Chief Executive’s review 20 Independent auditors’ report 62 Overview of the year 04 Financial review 26 Consolidated Personal customers 06 income statement 63 Governance Business customers 08 Consolidated statement Corporate social of comprehensive income 64 Scale where it matters 10 32 responsibility Consolidated balance sheet 65 Business review Business model Prinicipal risks 38 and demand drivers 12 Consolidated Board of Directors 40 statement of changes Strategy 14 in shareholders’ equity 66 Executive team 44 Chairman’s statement 16 Consolidated cash Directors’ flow statement 67 remuneration report 46 Notes to the Audit Committee report 54 financial statements 68 Nomination Independent auditors’ report 96 Committee report 55 Company balance sheet 97 Corporate governance 56 Notes to the Company 59 Directors’ report financial statements 98 Statement of Directors’ Notice of Annual Governance 61 responsibilities General Meeting 102 Proxy form 107 Directors and advisers 109 Financial statements Safestore Holdings plc Annual report and financial statements 2012 01 Overview Headlines Strategic progress and financial resilience Overall, we have delivered good progress on our strategy and resilient financial performance. Our total storage capacity at the end of 2012 is enough to fill the Olympic Stadium 6x six times. 02 Safestore Holdings plc Annual report and financial statements 2012 Overview Operational highlights Financial highlights7 — Closing occupancy1 up 2.5% to 3.29 million sq ft — Revenue up 5.5% and Revenue per Available Foot or 63.9% of Maximum Lettable Area (“MLA”) (“RevPAF”)2 & 3 up 5.2% in constant exchange rates (“CER”) — Strong growth in UK business customers, which now account for more than half our — Underlying EBITDA4 after strategic investments total occupancy down 0.4% to £50.3 million but up 0.8% in CER — Initial impact of the introduction of VAT in the — EPRA5 adjusted EPS on a cash tax basis6 down UK remains in line with original estimates 0.43 pence (3.9%) to 10.56 pence per share Business review — Four new stores opened during the year, completing — Property valuation reduced by 4.0% to the planned store expansion programme £685.8 million, reflecting imposition of UK VAT and adverse currency movements, with a resulting — Full re-financing of the Group completed loss before tax, including re-financing costs, — Group to apply for conversion to Real Estate of £19.5 million (year ended 31 October 2011: Investment Trust (“REIT”) status with effect profit before tax of £8.5 million) from 1 April 2013 — Basic EPS – loss of 4.16 pence per share (year ended 31 October 2011: earnings of 6.95 pence per share) — Final dividend increased by 7.0% to 3.80 pence per share, bringing total dividend to 5.65 pence per share Governance 1 Closing occupancy excludes offices but includes 82,800 sq ft of bulk tenancy as at 31 October 2012 (31 October 2011: 67,200 sq ft). 2 RevPAF is calculated as total revenue divided by total MLA excluding the five stores opened since 1 May 2011. 3 RevPAF for the year ended 31 October 2011 has been restated from £18.99 because of the exclusion of trading for Gonesse which opened in H2 2011 consistent with the current reporting. 4 EBITDA before exceptional items, contingent rent, fair value movement of derivatives and movement in investment properties (“underlying EBITDA”). 5 European Public Real Estate Association (“EPRA”). 6 EPRA adjusted EPS (cash tax only) removes the impact of deferred tax movements leaving only the tax charge which will actually be paid. 7 All figures are stated net of VAT. Revenue (£m) Underlying EBITDA (£m) 12 98.8 12 50.3 11 95.1 11 50.5 10 89.2 10 49.2 09 84.4 09 45.7 Financial statements 08 82.9 08 45.1 Ancillary revenue (£m) Dividend (pence per share) 12 13.8 12 5.65 11 13.2 11 5.30 10 12.2 10 4.95 09 11.5 09 4.65 08 10.9 08 4.65 Safestore Holdings plc Annual report and financial statements 2012 03 Overview Overview of the year Strengthening Safestore We’ve moved the Company forward in the past year with a new Brand Identity, new stores and rebranded stores. A new look and feel for Safestore We’ve created a new look and feel for our brand with a clearer distinctive identity. 04 Safestore Holdings plc Annual report and financial statements 2012 Overview Improving store visibility Orpington Chingford before before Business review after after Governance We took the opportunity to rebrand a number of high visibility stores during the year. Four new stores We opened four new stores in the year. Two in London at New Southgate, north London and Staines near Heathrow airport. Two are in the Paris Financial statements market at Gonesse, close to Paris – Charles de Gaulle airport and Velizy to the south-west of the city. New Southgate Gonesse Staines Velizy November 2011 January 2012 February 2012 July 2012 Safestore Holdings plc Annual report and financial statements 2012 05 Overview Personal customers Safestore the things you love We’re raising the profile of self-storage in the UK. Watch our new TV ad www.safestore.co.uk/TV More than one million people viewed the ad on YouTube Safestore aired its first TV ad campaign this year. 06 Safestore Holdings plc Annual report and financial statements 2012 Overview Your personal storage solution Moving house? New home not ready yet? Renovating, redecorating or decluttering your home? Relocating abroad? Can’t get your car in the garage for hobby or sports equipment? Or having Business review a big clear out? There are dozens of reasons why you might need somewhere to store your personal possessions. We understand the pressures involved in moving house or relocation especially if your new home is not ready. Our Governance great customer service and expert advice helps to make storing your belongings safe, easy and stress free. Our storage locations, local to you, offer a wide variety of unit sizes, from lockers to large rooms and are suitable for storing a huge range of items. Financial statements Safestore Holdings plc Annual report and financial statements 2012 07 Overview Business customers Best for business Is your business expanding or simply overstocked? Need space for stock, equipment, promotional material or archive documents? Need to free up valuable office or work space? Renovating, relocating or decorating your business? There are dozens of reasons why you might need Safestore. 7373%% 2727%% 5522%% 4848%% We have a balanced mix of personal and business customers with 52% of our space occupied by business customers and 48% by personal customers. During the year we increased the size of our National Accounts sales force to help us reach more large scale national customers across the UK. Justin works as one of our Store Managers and works closely with our National Accounts team to give our business customers the solution they require. 08 Safestore Holdings plc Annual report and financial statements 2012 Overview Flexible space to help you grow We provide a flexible and affordable alternative solution to renting commercial space whilst also ensuring that business customers stock is safe and secure, helping Business review to take away the burden of managing multiple storage units, deliveries and other logistical concerns. Governance Our National Accounts occupancy was 43% up on the prior year to more than 200,000 sq ft. Financial statements Our National Accounts Our national network matters – 76% of the National Accounts occupancy is outside London. With our UK network of stores we can deliver business solutions nationally. Safestore Holdings plc Annual report and financial statements 2012 09 Overview Scale where it matters More Space where you need it We have a market-leading position in the UK and Paris. As at 31 October 2012 our wholly-owned portfolio included 123 stores – 98 in the UK and a further 25 in Paris. Your local self-storage company Lok’n Store We have 123 stores across the UK and Paris meaning we have more stores than any other storage company 24 in the UK and Paris. Because of this we can offer great prices in the most convenient locations. UK stores only 10 Safestore Holdings plc Annual report and financial statements 2012 Overview Safestore 98 Business review 42,000 We have more than 42,000 customers at Safestore. Big Yellow Access 66 Governance 54 Financial statements Safestore Holdings plc Annual report and financial statements 2012 11 Overview Business model and demand drivers A straightforward business with strong demand Our straightforward business model drives sustainable performance... En qu t iri fi es Enquiries and service ro a We use our sales and P n Profit d marketing system to create We focus the business on s customer enquiries from e improving efficiency and r both personal and v i delivering profitability. c business customers. e Store R locations e v e n u e Revenue per Available p n Sales conversion e o Foot (“RevPAF”) r i We drive sales enquiry A s We set the right rental rate v r conversion rate through a ve to grow our occupancy and il n customer service and clear ab o optimise our Revenue per le c product offers for different Available Foot. F les oot Sa customer needs. 12 Safestore Holdings plc Annual report and financial statements 2012 Overview Our staff are always on hand to help our customers find the best solutions to their needs.