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LONDON (Alliance News) - Safestore Holdings PLC Thursday said it swung to profit in the full-year, in a period which saw it convert to a UK Real Estate Investment Trust (REIT) and appoint a new Chief Executive.
The company, which provides storage space for businesses and personal customers, posted a pretax profit of GBP48.6 million for the period ended October 31 2013 compared with a GBP19.5 million loss a year earlier.
Last year the company was hurt by a property revaluation, the imposition of UK VAT on the self-storage industry and averse currency movements, it said in a statement.
Since then, the portfolio value has increased to GBP730.2 million from GBP690.50 million in 2012, while the UK portfolio rose to GBP547.8 million from GBP526.1 million bolstered by the sale of its Whitechapel site for GBP41.1 million, GBP14.6 million above book value.
The French business increased in value to EUR213 million from EUR204.1 million in the corresponding period.
Revenue, however, fell 2.7% to GBP96.1 million from GBP98.8 million in 2012. Safestore attributed the reduction in revenue to the impact of the new VAT rules in the UK which resulted in a fall in revenue of GBP4.7 million - marginally better than its June 2012 guidance of a GBP5-6 million revenue reduction.
Geographically in the UK, revenue fell 6.2% to GBP70.2 million from GBP74.9 million, however the French business performed strongly with revenue rising 4.8% on a constant currency basis to EUR30.7 million from EUR29.3 million.
During the period, Safestore converted to a UK REIT which has resulted in the removal of its UK corporation tax liability on UK property rental income and the elimination of substantial deferred tax liabilities from the balance sheet.
The conversion was followed by the appointment of Frederic Vecchioli as Chief Executive in September. Vecchioli, who succeeded Peter Gowers, was the founder and President of Une Pièce en Plus, the French arm.
Looking ahead the firm said it has a renewed focus on operational delivery to improve occupancy and thereby group performance.
"Safestore has a strong presence in its key markets and a fully invested portfolio with capacity to fill," Vecchioli said in a statement.
"With the imposition of VAT in the UK now behind us and with an improving economic climate, I am confident that, after the strategic investment of the last two years, our operational focus and leaner cost base leave us well positioned to realise the significant opportunities ahead," he added.
In a separate note the firm said it planned to place 18.6 million shares at 1 pence each, with the proceeds used to accelerate its debt.
The Board has recommended a final dividend of 3.90 pence per share from 3.80 pence in 2012 resulting in a full year dividend of 5.75 pence per share from 5.65 pence.
The stock was trading at 0.0018 pence Thursday morning, up 0.0002 pence or 12.5%.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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