Financial results
Revenue for the year was £69.7 million, an increase of £4.0 million (6%) from £65.7 million in the prior year. Store revenue increased by 6% in the year to £68.3 million (2012: £64.3 million). The other revenue earned is from fee income earned from Big Yellow Limited Partnership and Armadillo and tenant income on sites where we have not started development. Other sales (included within the above), comprising the selling of packing materials, insurance and storage related charges, represented 17.2% of storage income for the year (2012: 17.1%) and generated revenue of £10.0 million for the year, up 7% from £9.4 million in 2012.
Store revenue for the fourth quarter decreased by 1% to £15.9 million from £16.1 million for the same quarter last year. Store revenue in the seasonally weaker second half of the year was £32.7 million, up 1% from £32.4 million for the second half of the year ended 31 March 2012.
There was an increase in revenue of 1% for the 32 established stores and 18% for the 22 lease-up stores. The EBITDA margin for the 32 established stores was 67% (2012: 65%), the EBITDA margin for the 22 lease-up remained at 60%. The table below shows the performance of the 32 established stores and the 22 lease-up stores during the year.
| Capacity | Occupancy | Revenue | EBITDA | ||||
|---|---|---|---|---|---|---|---|
| 000 sq ft | 31 March 2013 000 sq ft |
31 March 2012 000 sq ft |
31 March 2013 £000 |
31 March 2012 £000 |
31 March 2013 £000 |
31 March 2012 £000 |
|
| 32 established stores | 1,941 | 1,413 | 1,442 | 44,135 | 43,793 | 29,497 | 28,388 |
| 22 lease-up stores | 1,491 | 810 | 691 | 24,199 | 20,480 | 14,635 | 12,371 |
| Total | 3,432 | 2,223 | 2,133 | 68,334 | 64,273 | 44,132 | 40,759 |
The Group made a profit before tax in the year of £31.9 million, compared to a loss of £35.6 million in the prior year. The prior year loss reflected the decrease in the valuation of the Group’s open stores following the valuer’s assessment of the impact of VAT. The valuation of the stores in the current year is broadly in line with the prior year.
After adjusting for the gain on the revaluation of investment properties and other matters shown in the table below the Group made an adjusted profit before tax in the year of £25.5 million, up 8% from £23.6 million in 2012.
| 2013 £m |
2012 £m |
|
|---|---|---|
| Profit/(loss) before tax | 31.9 | (35.6) |
| (Gain)/loss on revaluation of investment properties | (9.5) | 51.4 |
| Movement in fair value on interest rate derivatives | 0.2 | 8.0 |
| Gains on surplus land | (1.0) | (0.5) |
| Refinancing costs | 4.3 | – |
| VAT implementation costs | 0.2 | – |
| Share of non-recurring (gains)/losses in associate | (0.6) | 0.3 |
| Adjusted profit before tax | 25.5 | 23.6 |
The movement in the adjusted profit before tax from the prior year is illustrated in the table below:
| £m | |
|---|---|
| Adjusted profit before tax – year ended 31 March 2012 | 23.6 |
| Increase in gross profit | 3.0 |
| Increase in net interest payable | (0.3) |
| Increase in administrative expenses | (0.4) |
| Increase in share of recurring profit of associate | 0.4 |
| Decrease in capitalised interest | (0.8) |
| Adjusted profit before tax – year ended 31 March 2013 | 25.5 |
Diluted EPRA earnings per share based on adjusted profit after tax was up 6% to 19.3p (2012: 18.2p) (see note 12). Basic earnings per share for the year was 24.4p (2012: loss per share of 27.7p) and fully diluted earnings per share was 24.1p (2012: loss per share of 27.4p).
Operating costs
We have continued with our programme of cost control in the Group.
Cost of sales comprise principally of the direct store operating costs, including store staff salaries, utilities, business rates, insurance, a full allocation of the central marketing budget, and repairs and maintenance.
Direct store operating costs for the established portfolio have fallen by 4% reflecting the increased recoverability of VAT on our operating costs in the second half of the year. The operating costs in the lease-up stores have increased due to the additional operating costs of New Cross and Chiswick, additionally by general inflationary pressures, notably from business rates, offset by the improved VAT recovery. Additionally, the prior year costs included a rates rebate on two stores.
Administrative expenses in the income statement have increased by £0.6 million compared to the prior year. £1.4 million of the £7.7 million administrative expense is non-cash IFRS 2 share based payment charges. The increase in administrative expenses was largely due to an expense of £0.6 million in respect of Employers’ National Insurance on the vesting of the Company’s long term bonus plan for the period 2009 to 2012. This has been offset by a reduction in irrecoverable VAT in the second half of the year. There was also a cost of £0.2 million in respect of costs incurred challenging and implementing the imposition of VAT on self storage, which has been added back in calculating the Group’s adjusted profit for the year.
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