Big Yellow occupancy improves but caution remains
Big Yellow Group’s third quarter revenue rose slightly as occupancy improved while the storage company remained cautious about the economic outlook of Britain.
Like-for-like revenue growth for the third quarter ended 31 December, which is traditionally weaker, nudged up 5% to £26.9m as it was affected the loss of occupancy in the quarter being more front-ended.
While revenue for the quarter increased 7% to £27.4m and LFL revenue for the year to date rose 6% to £80.7m.
After a weak October, occupancy improved in November and December with a loss of 137,000 square feet, 3% of maximum lettable area (MLA) in 73 stores, compared to a loss of 138,000 square feet, 3.1% of MLA, the prior year.
The average year-on-year rate growth slowed to 2.3% compared to 2.8% for the first half of the year.
The FTSE 250 company said that its guidance for the year "remains in line with current consensus".
Chief executive James Gibson, said “significant uncertainties remain around the UK's economic outlook” and that new supply in key areas of operation, particularly London, will “remain constrained over the medium to longer term” but that the business is “well placed to face down most challenges”.
He added: “We look forward to delivering occupancy and revenue growth over this quarter and to continuing this growth into our seasonally stronger spring and summer trading period."
Revenue from the Armadillo business increased by 17% to £2.6m and LFL revenue, excluding the West Molesey and Canterbury sites, which were bought from Lock and Leave in April 2016, increased by 4%.
During the quarter the company started construction at its site in Guildford for a 55,000 square feet MLA store opening in early 2018, and gained planning permission for a 25,000 square feet extension to its Wandsworth store, expected to be completed in spring 2018.