U.K. self-storage operator Big Yellow Group PLC released financial results for its 2020 fiscal year, which ended March 31. The company reported same-store revenue of £128.2 million, up 3.8 percent year over year. Total revenue for the period was £129.3 million, a 3.1 percent increase from 2019. Same-store occupancy was 81.3 percent, down from 82.4 percent. Average rent per square foot was £27.86, up 2.7 percent.
The numbers were positive despite operational adjustments and government orders in reaction to the spread of the coronavirus, which began to affect Big Yellow markets in mid-March. The company is also optimistic about future performance despite continuing uncertainty from the health crisis and its economic impact.
“We, together with every other business, have experienced two seismic external shocks in 12 years. As was the case with the global financial crisis, the COVID-19 pandemic will most likely accelerate and accentuate pre-existing structural trends, challenges and opportunities, and no doubt catalyze some that are currently unforeseen,” said Nicholas Vetch, executive chairman. “For this business, there will be some negatives but a good deal of positives, which we believe give us grounds for reasonable optimism. It will take time for those competing forces to play out and some clarity to emerge, which will become evident in the performance of the business over the next few years.”
Vetch indicated it’s impossible for businesses to confidently predict the timing of “momentous events” like worldwide economic and health crises, and stressed the need for Big Yellow to carry a modest amount of debt. “Although it has only been a couple of months, the business has so far proved to be relatively resilient through the initial lockdown phase; but as always, we caution that we have limited visibility as to future trading patterns,” he said.
Despite the cautionary approach to its capital structure, Big Yellow will continue to pursue growth opportunities, particularly in Greater London, Vetch said. During the year, the company acquired three sites, bringing its development pipeline to 13 projects comprising about 880,000 square feet. It’s received approvals for six of those developments.
Big Yellow Group operates 100 self-storage locations in the United Kingdom under the Big Yellow Self Storage and Armadillo brand names, with most concentrated in Greater London and Southeast England. Its total portfolio comprises 5.8 million square feet.
Big Yellow, Results for the Year Ended 31 March 2020