Strong Q1 performance, continuing momentum.
Frederic Vecchioli, Chief Executive Officer commented:
"It has been an excellent start to the financial year. Our first quarter performance has been strong, continuing the trading momentum seen in the second half of 2018 in both our UK and Paris markets.
We continue to build our new store pipeline with three new sites in the UK in London- Carshalton, Birmingham Merry Hill and Peterborough (subject to planning) and two sites in Paris at Pontoise and Magenta (subject to planning) planned to open during 2019 and 2020. In addition, our strong and flexible balance sheet remains in good shape and allows us to continue to consider value-accretive investments as and when they arise.
Our priority, and largest opportunity, remains the significant upside from the utilisation of our 1.8m square feet of fully invested unlet space. We are pleased with the start to the 2019 financial year, which is in line with our expectations, and remain confident in the future and focused on the continued delivery of shareholder value."
The UK has performed strongly in the first quarter of 2019. Like-for-like revenue growth of 6.1% was driven by a balance of strong occupancy and good average storage rate performance. The like-for-like closing occupancy as measured by sq ft occupied was up 3.4% and the average storage rate continued its improving performance and grew by 2.9%. Closing occupancy at the end of the quarter as a percentage of MLA was up 2.6ppts at 71.8% (2018: 69.2%).
Total revenue growth of 5.3% reflected the like-for-like growth as well as the store openings in Mitcham and Paddington Marble Arch in 2018, offset by the closures of Merton, Paddington and Leeds. Both of the new stores opened in 2018 are performing well.
Our Paris business had a very strong quarter, growing total revenue by 8.3%. Our new 80,000 sq ft store at Poissy, opened in Summer 2018, is performing well and contributed to the total revenue figures. However, the immaturity of this store has had a dilutive effect on the closing occupancy (% of MLA) and the average rate.
Like-for-like Euro revenue grew by 7.3% in the quarter. Like-for-like occupancy performance was strong for the quarter with closing occupancy at 80.9%, up 6.0ppts compared to 2018. The like-for-like average rate, which was down 0.2% year-on-year in the quarter, was impacted by the inclusion of the lower priced suburban store at Combs-la-Ville being included in the like-for-like category for the first time.
New Store - Peterborough
In January 2019 we completed the acquisition of a freehold site in Peterborough. The site was acquired from Homebase and is one mile east of the City Centre. Subject to planning permission, the existing building will be converted into a 42,000 sq ft self storage facility and opened in the final calendar quarter of 2019.
Lease Extension - Portsmouth
As part of our ongoing asset management programme, we extended the lease on our Portsmouth (Fratton) store during the period. The lease now has 24 years left to run and a twelve month rent free period was secured as part of the negotiation.
Lease Assignment - Merton
As announced in our 2018 Results, we closed our Merton store in July 2018 and consolidated the majority of customers into our new Mitcham site. We have now assigned the leases on the Merton store to a third party.