LOK'NSTORE GROUP PLC
("Lok'nStore" or "the Group")
Lok'nStore Group Plc, the AIM quoted self-storage company
announces interim results for the six months to 31 January
2024
Revenue
Headline
ü Group
Revenue £14.17 million up 4.3% (31.01.2023: £13.58 million)
ü Headline Self Storage Revenue up 4.9% to £13.33 million
(31.01.2023: £12.70 million)
ü Group
Adjusted EBITDA1 £7.65 million
down 3.6% (31.01.2023: £7.93
million)
Same Store14
ü Same
Store Group Revenue15
£13.93 million up
2.6% (31.01.2023: £13.58 million)
ü Same
Store Self Storage Revenue15
£13.09 million up
3.1% (31.01.2023: £12.70 million)
ü Same
Store Group Adjusted EBITDA1 £7.86 million down 0.9%
(31.01.2023: £7.93 million)
This Same Store analysis and all other Alternative
Performance Measures (APM's) denoted by superscripts are explained
in the key performance indicators (KPIs) definitions
below.
Operating Metrics
ü Pricing
up 4.0%
(31.01.2023: 9.2%) to
£27.37 per sq. ft
(31.01.2023: £26.45 per sq. ft)
ü Occupied unit space down by 2.9% to 22,639 sq. ft to 862,554
sq. ft
ü Same
Store stores15 EBITDA margins 58.9% (31.01.2023: 60.3%)
Banking, net debt and liquidity
ü £10.0
million out of total debt of £43.7 million fixed at all-in cost of
5.2% at 31 January 2024
ü £15.0 million cash at period-end
(31.07.2023: £42.1 million) (31.01.2023: £40.3
million)
ü Net
debt (excluding lease liabilities and deferred finance costs) £28.8
million (31.07.2023: £12.3 million) (31.01.2023:
£26.5 million)
ü Loan to
Value ratio6 (net of cash) 8.3%
(31.07.2023: 3.7%) (31.01.2023:
8.9%)
NAV per share
ü Adjusted Net Asset Value5 per share up
0.1% to £9.87 per
share (31.07.2023: £9.86 per share)
(31.01.2023: £9.15 per share)
(Refer Financial Results for detailed calculation)
New store Pipeline8
ü Two new
Landmark stores opened.
- Basildon in period
- Kettering (managed) just after period-end (9 February
2024)
ü Two new
Landmark stores on site in Staines and Bromborough (managed) will
open in 2024
ü Sunbury
leasehold store to be closed and customers moved to a new effective
freehold store in Staines and other freeholds
ü Planning permission received at Barking, Cheshunt and
Eastbourne.
o Cheshunt expected to be on site by the end of
2024.
ü The
Board is keeping under review when to go on site at the other
pipeline stores dependent on the economic cycle.
Recommended Cash Offer of Lok'nStore Group Plc by Shurgard
Self Storage Ltd "Shurgard") ("the Offer")
ü On 11
April 2024 the boards of Shurgard and Lok'nStore announced that
they had reached agreement on the terms of a recommended cash offer
to be made by Shurgard at 1,110 pence per share (the
Offer).
ü The
Directors intend to unanimously recommend the Offer.
ü The
Offer contains a customary price adjustment in respect of any
dividends declared, made or paid after 11 April 2024 and hence the
Board is not recommending a dividend at this interim
stage.
ü It is
proposed that the Offer will be implemented by a Scheme of
Arrangement ("the Scheme")
For all of the definitions of the terms used in the
highlights above refer to the KPI notes section
below.
Commenting on the Group's results,
Andrew Jacobs, Chair of Lok'nStore Group said,
"Lok'nStore's revenue has moved
ahead with Group Revenue up 4.3% and headline self-storage revenue
up by 4.9%. With this muted growth and some cost increases,
Group Adjusted EBITDA of £7.65 million was down 3.6%.
Customer demand remains
above levels seen pre-pandemic, although it has been lower compared
to the same period 12 months ago."
"We have made progress on our new
store pipeline with our new Landmark store in
Basildon opened in December and Kettering opened in early February.
We are on site at two locations in Staines and Bromborough, both of
which will open in 2024."
Enquiries:
Lok'nStore:
Andrew Jacobs, Chair
Ray Davies, Finance
Director
Neil Newman-Shepherd, Managing
Director
|
01252 521 010
|
Cavendish Capital Markets Ltd
Julian Blunt / Seamus Fricker,
Corporate Finance
Sunila de Silva, Corporate
Broking
|
020 7220 0500
|
Peel Hunt
Capel Irwin / Carl Gough / Henry
Nicholls
|
020 7418 8900
|
Camarco
Billy Clegg / Tom Huddart/ Letaba
Rimell
|
0203 757 4991
|
Chair's Statement
Trading
At a headline level we report
a 4.3% increase
in Group Revenue. Same-Store Group Revenue grew by
2.6% over the last
year.
Occupied unit space was down 2.9%
in the first half compared with the same period last year. Our
pricing moved forward by 4.0% when compared with 31 January
2023.
Customer demand
remains above levels seen pre-pandemic, although
it has been lower compared to the same period 12 months
ago,
Our new stores in Bedford,
Peterborough and Basildon accounted for £0.45 million of operating
costs as we expand our portfolio of Landmark assets. On a Same
Store basis, costs have increased by £0.43 million or 7.7%.
£0.39 million of this relates to property cost increases from Rent,
Energy and Business rates.
The cash cost of bank interest paid
(before capitalisation of interest costs, non-utilisation fees and
loan amortisation fees) in the period was £1.27 million
(31.01.2023: £1.34 million). This broadly unchanged position
reflects the outcome of rising rates offset by the reduction in
drawn debt (See below).
Net Asset Value
In line with the Group's normal
policy, we have not conducted an interim valuation of trading
assets in this period, however
following the Offer, the document relating to the
Scheme ("the Scheme Document") will include an independent external
valuation in respect of Lok'nStore's property portfolio
commissioned in accordance with Rule 29 of the Takeover
Code. The Scheme Document will be
circulated to shareholders within the next few weeks.
Adjusted Net Asset Value per share
has moved up 1 penny to £9.87 per share
since last year-end (31 July 2023: £9.86 per share) (31 January
2023 £9.15 per share).
Since the last year-end at 31 July
2023 Jones Lang LaSalle (JLL), considers
that the yields and discount rates which were applied at the July
2023 year-end have not materially changed.
We have two new stores in Staines
and Basildon which will have their maiden external valuation in
July 2024,. More details on the valuation
of our trading stores can be found in note 11 of the financial
statements.
Investment in new Stores
In the period we invested £18.5
million in new store development. We
opened two new stores in Basildon and Kettering (9 February 2024).
The Basildon store is our first purpose built leasehold Landmark
store.
We are also on site in Staines and
Bromborough. At Staines we are positioned above an Aldi
supermarket and will open at the end of April 2024. We are on site
at Bromborough on behalf of a third-party Managed Store
client.
At 31 January 2024, the remaining
capital expenditure required to complete the Staines and Basildon
stores is £2.63 million, all of which can be paid out of cash.
New Store pipeline
Beyond the stores currently on
site, we have a further 7 stores in our pipeline. In the last
few months, we have achieved planning at Barking, Cheshunt and
Eastbourne. Bournemouth, Milton Keynes and Altrincham all
have live planning applications submitted.
It is our intention to go on site
at the Cheshunt store before the end of 2024.
We will build a c.60,000 sq. ft. Landmark
store along with retail space for a discount food retailer. The
discount food retailer will pay a lease premium to Lok'nStore on
completion of planning matters and make further payments to
Lok'nStore through the building programme as work
progresses.
We carefully evaluate the ongoing
economic and trading position before making any further capital
commitments and can reduce capex quickly if the market
deteriorates.
Closure of Sunbury Leasehold Store
In line with our continuing
strategy of recycling older stores into purpose-built Landmark
stores and leases into freeholds, we will close the Sunbury
leasehold store in early FY25. Our policy over many years has
been that we are happy with leasehold stores which provide a higher
return on capital than freeholds, but that we prefer freeholds if
and when the opportunity arises. Over the years we have both
bought out the freeholds of existing leasehold stores and also
built new freehold stores elsewhere and moved the customers from
the leasehold to the freehold store.
In this case the closure of the
Sunbury store has been timed to coincide with the opening of our
new store in Staines in Spring 2024, a few miles away. The Staines
store is an effective freehold, being on a 250-year lease at
peppercorn rent. We expect to move a number of the current
Sunbury customers to the new Staines store and other local freehold
stores. Therefore, we expect the new
Staines store to be trading cash positively quickly. As the lease
of the Sunbury store expired in August 2022, the store was valued
at £0 in the July 2023 valuation.
The move from an older building to
a new purpose-built Landmark store improves our brand image to our
customers, removes latent capital expenditure and further reduces
our environmental impact. The move from a leasehold to an effective
freehold also reduces operational gearing by removing the property
rental charge.
The closure will result in a
modest reduction in the expected Group Revenue in the coming years.
In FY23, the Sunbury store generated £1.3 million in revenue and
£0.6 million of EBITDA.
Managed Stores
Our strategy includes increasing
the number of stores we manage for third party owners. This enables
the Group to earn revenue without having to commit capital, to
amortise fixed central costs over a wider operating base and direct
further traffic to our website which benefits our entire
operation.
Lok'nStore manages 17 stores for
third-party owners including the Kettering store which opened in
February 2024. This will increase to 18 managed stores once the
Bromborough store opens in Autumn 2024.
During the period, we generated
total Managed Store income of £0.78 million, with recurring fees of
£0.75 million (31.01.2023: £0.82 million), down 5.1%. While base
management fees, calculated as a percentage of revenue, were
higher, performance fees based on EBITDA were slightly lower due to
the higher operating costs of the Managed Stores.
In the management fees table in
the Business and Financial Review, we separate recurring management
fees from non-recurring fees. Non-recurring fees relate to one-off
fees generated from planning, store opening, construction and
advisory and supplementary fees.
Cash Flow, Debt and Bank
Covenants
The company continues to be in a
strong financial position with low net debt.
On 11 August 2023, the Group paid
down £19.02 million out of its recent equity placing proceeds
reducing the balance on its Revolving Credit Facility, pending
redrawing over time for its future deployment on the Group's
pipeline stores.
In December 2023, the Group
entered into five-year interest rate swaps on £10.0 million of its
floating rate debt. The two separate swaps of £5.0 million each
were executed at a SONIA swap rate of 3.51%, providing an all-in
effective rate payable on this swap of 5.2% and will result in
estimated saving of c.£0.2 million of interest payable in the
coming year.
A conservative capital structure
and a strong Balance Sheet remain a key focus for the
business. We report a period-end LTV ratio
(net of cash) of 8.3% (31.07.2023: 3.7%) and a low level of net
debt of £28.8 million, (31.07.2023: £12.3 million) (refer to note
24b). At 31 January 2024, the Group had
cash balances of £14.97 million. Cash inflow from operating
activities before investing and financing activities was £6.81
million in the year to 31 January 2024 (31.01.2023: £7.85
million).
The Group has a £100 million
five-year Revolving Credit Facility. The Group is not obliged to
make any repayments on its loan facility prior to its expiration in
April 2026.
The floating average cost of bank
debt on drawn facilities for the period was 6.72% (31.01.2023:
4.13%). as rates have moved higher. Except for the £10
million of fixed debt, the Group's remaining drawn bank debt of
£33.7 million (31.01.2023: £66.8 million) is unhedged. At the date
of this Report the Group's current cost of blended debt after
including the positive effect of the hedging is running at
6.63%.
At the period-end senior
interest cover was 3.8 times finance charges on gross debt tested on a 12-month rolling
basis, against a bank covenant of 2.5 times.
On a quarterly and a monthly testing at 31
January 2024, the cover had risen to over 4 times.
At the period-end our loan-to-value ratio based
on net bank debt was 8.3% versus a bank covenant of 60%.
Recommended Cash Offer of Lok'nStore Group Plc by Shurgard
Self Storage Ltd ("Shurgard") ("The Offer")
On 11 April 2024, the Boards of
Shurgard and Lok'nStore announced that they have reached agreement
on the terms of a recommended cash offer to be made by Shurgard to
acquire the entire issued and to be issued share capital of
Lok'nStore (the 'Acquisition').
Under the terms of the Offer,
Lok'nStore Shareholders will be entitled to receive 1,110 pence in
cash for each Lok'nStore Share. The Directors intend to unanimously
recommend the Offer.
The Offer is expected to be
effected by means of a Court-sanctioned scheme of arrangement
between Lok'nStore and Scheme Shareholders under Part 26 of the
Companies Act 2006, although Shurgard reserves the right to effect
the Acquisition by way of a Takeover Offer.
The Offer
contains a customary price adjustment in respect of any dividends
declared, made or paid after 11 April 2024 and hence the Board are
not recommending a dividend at this interim stage.
Environmental progress
Our Environmental targets for FY24
are:
·
Decarbonise our business to be Net Zero in our
operations by 2040
·
Assess recommended improvements from current EPCs
and action as appropriate
·
Trial the installation of a battery at one
store
·
To increase the number of stores with
PV systems
·
Continue the roll out of LED lights for all
stores
·
Obtain BREEAM accreditation at one
store
·
Determine a route to eliminate waste destined
for landfill
Our business Objectives
Our business objectives are
to:
·
Fill existing stores and improve
pricing
·
Develop our pipeline into new Landmark
stores
·
Acquire more sites to build new Landmark
stores
·
Increase the number of stores we manage for third
parties
Outlook
In the short term our focus is to
drive the operating performance of all of our existing stores. We
have opened stores in Basildon and Kettering and will be opening
shortly in Staines and Bromborough. We expect to go on site
at Cheshunt before the end of 2024. The Board are keeping under review when to go on site at the
other pipeline stores.
Since 31 January 2024 Lok'nStore
has continued to observe positive but muted revenue growth.
Headline stores revenue in February and March 2024 was 4.2 per
cent. up on the same period last year, compared to year-on-year
growth of 13.7 per cent. in the same period in 2023.
Andrew Jacobs
Chair
19 April 2024
Notes - What we mean when we say … (and why we use these key
performance indicators (KPIs))
In addition to IFRS accounting
performance measures we use some Alternative Performance Measures
(APMs) to help us explain how the underlying business is
performing.
Here we identify those measures
and explain what we mean when we use them and, importantly, why we
use them: -
1.
Group Adjusted
EBITDA (Group Adjusted Earnings before interest, tax, depreciation
and amortisation) - Adjusted EBITDA
is defined as EBITDA before losses or profits on disposal,
share-based payments, acquisition costs and non-underlying items
which demonstrates the cash generative qualities of the
business.
2.
Non-underlying
items - Refers to one-off items of
a non-operational nature which arose during the year, and which may
relate to asset disposals, abortive site acquisition costs, or
other costs and which are likely to be material and infrequent
events. (Refer to note 4 of the Financial Statements).
3.
Cash Available
for Distribution (CAD) - Is
calculated as Adjusted EBITDA less total net finance cost, less
capitalised maintenance expenses, New Works Team costs and current
tax. This measures the capacity of the business to pay
dividends or pay down debt. The Cash
Available for Distribution per share is CAD divided by the number
of shares in issue less shares held in the Employee Benefit Trust
(EBT) which do not attract a dividend. The calculation of
the CAD and the CAD per share
is set out in the Financial Review.
4.
Adjusted Total
Group Assets - The value of
adjusted total assets of £384.2 million (31.07.2023: £392.9
million) (31.01.2023: £353.0 million) is calculated by adding the
independent valuation of the leasehold properties of £27.2 million
(31.07.2023: £27.2 million) (31.01.2023: £22.9 million) less their
corresponding net book value (NBV) £6.9 million (31.07.2023: £6.9
million (31.01.2023: £7.0 million) to the total assets in the
Statement of Financial Position of 363.9 million (31.07.2023 £372.6
million) (31.01.2023 £337.1 million).
This provides clarity on the
significant value of the leasehold stores as trading businesses
which, under the Group's accounting policy on leases, are only
presented at their book values within the Statement of Financial
Position.
5.
Adjusted Net
Asset Value per share (NAV per share) - Adjusted Net Asset Value per share is the net assets adjusted
for the valuation of leasehold stores (properties held under
leases) and deferred tax divided by the number of shares at the
period-end. The shares held in the Group's employee benefits trust
and treasury shares are excluded from the number of shares.
The calculation of the Net Asset Value per share
is set out in the Financial Review.
6.
Loan to Value
ratio (LTV) - Measures the net debt
of the business expressed as a percentage of total property assets
giving a perspective on the gearing of the business. The
calculation is based on net debt (excluding deferred finance costs)
of £28.8 million expressed as a percentage of the total freehold
and leasehold properties independently valued by JLL of £301.9
million (31.07.2023: £301.9 million) and development land assets of
£45.2 million (31.07.2023: £30.6 million) totalling £347.1 million
(31.07.2023: £332.5 million) (31.01.2023: £297.5 million) as set
out in the Financial Review in the Analysis of Total Property Value
table.
7.
Average Cost of
Debt - The average cost of debt is
calculated by taking the total interest paid on the Group's
Revolving Credit Facility in the quarterly/weekly charging periods
throughout the year and taking an average based on the whole
financial year. Apart from the Group's Revolving Credit Facility,
the Group has no other bank debt. The
average cost of floating debt was 6.72% (31.07.2023: 4.77%) (31.01.2023:
4.13%%).
8.
Pipeline Sites - Sites for new stores that either we
have exchanged contracts on or have agreed heads of terms and are
progressing with our lawyers towards a contract exchange. We have
9 pipeline sites of which 8 are contracted and one progressing with lawyers. At
31 January 2024, we have 26 Owned Stores trading with an additional
16 Managed Stores trading. When these 11
sites are fully developed, we will have a total of 54 stores - 36
will be owned by the Group and 18 will be Managed Stores managed on
behalf of third-party owners. The Kettering store recently opened
after the period-end in February 2024 making 17 Managed Stores
trading, When the Bromborough site, which is currently being built
opens in the Autumn, we will have 18 Managed Stores
trading.
9.
Secured Pipeline
Sites - The ten sites for new
stores on which we have exchanged legal contracts. Of these, eight
stores are Lok'nStore Owned Stores and two will be Managed
Stores.
10.
Adjusted
Store EBITDA is Group
Adjusted EBITDA (see 1 above) before the
deduction of central and Head Office costs. Unlike Group Adjusted
EBITDA, this measure excludes the impact of IFRS 16 and includes
property rentals payable as normal operating costs of each store.
The measure is designed to give clarity on the recurring operating
cash flow of the business and provides important information on the
underlying performance of the trading stores and shows the
cash-generating core of the business. Use of this metric enables us
to provide additional information on store EBITDA contributions
(after leasing costs) and the margins analysed between freehold and
leasehold stores and according to the age of the stores. This
analysis is set out in a table in the Financial Review.
11.
Gearing refers to the level
of debt compared to equity
capital, usually expressed in percentage form. It
is a measure of a company's financial leverage
and shows the extent to which its operations are
funded by lenders
versus shareholders. Gearing can be measured by a
number of ratios, and we use the debt-to-equity ratio in this
document. The calculation of the gearing
percentage, also referred to as the net debt to equity ratio, is
set out in note 16 of the Financial
Statements.
12.
Group Adjusted
EBITDAR is Group Adjusted EBITDA before the deduction of rent. The
measure is designed to give clarity on the effect of the rent
payable by leasehold stores and how its elimination enables a
comparison between the operating performance of freehold stores
(which do not pay rent) and leasehold stores which pay rent. This
analysis is set out in a table in the Financial Review.
13.
Cost
Ratio calculates the ratio of the
total operating costs of the business as set out in the
Financial
Review, expressed as a percentage of total Group revenue (note 1),
giving a perspective on the cost efficiency of the business when
compared to the cost ratio of the previous year. The Cost Ratio has
increased to 45.2% (31.07.2023: 43.6 %) (31.01.2023: 40.7
%)
14.
Same Store Group
- This measure is used to give
transparency on the performance in the operating business in the
period unrelated to the opening of new stores, and commenting on
stores that were open and trading at both 31 January 2023 and 31
January 2024 financial period-ends. The Same Store key performance
measure helps to illustrate the performance of the underlying
business.
15.
Same Store
Self-Storage - This measure is the
Same Store Group measures, but less management income received from
the management of the Managed Store portfolio. This is used to give
transparency on the underlying trading of the self-storage
business.
See also the glossary
Business and Financial
Review:
The Performance of Our Stores
Headline
ü Group
Revenue £14.17 million up 4.3% (31.01.2023: £13.58 million)
ü Group
Adjusted EBITDA1 £7.65 million
down 3.6% (31.01.2023: £7.93
million)
ü Price
up 4.0%
(31.01.2023: 9.2%)
Same Store14
ü Same
Store Self Storage Revenue15
£13.09 million up
3.1% (31.01.2023: £12.70 million)
ü Same
Store Group Revenue15
£13.93 million up
2.6% (31.01.2023: £13.58 million)
ü Same
Store Group Adjusted EBITDA1 £7.86 million down 0.9%
(31.01.2023: £7.93 million)
ü Same
Store EBITDA margin decreased to 58.9% from 60.3%
Revenue
Revenue growth in FY24 is muted
with self-storage revenue up 4.3%. Same-store self-storage
revenue was up 3.1% on the previous year.
Price per sq. ft of occupied space
which was up 4.0% period to period (31.01.2023:
9.2%).Customer demand remains above levels seen pre-pandemic, although it has been
lower compared to the same period 12 months ago. This resulted in occupied unit space down 2.9% in the first
half compared with the same period last year.
Ancillary Sales
Ancillary sales consisting of
boxes, packaging materials, insurance and other sales were up 2.2%
to £1.29 million (31.01.2023: £1.26 million) accounting for 9.7%
(31.01.2023: 10.5%) of self-storage revenues.
Portfolio Analysis and Performance
Breakdown
In the table below we show how the
performance of the stores varies between freehold and leasehold
stores. Currently 46.0% of Lok'nStore owned trading space is freehold,
20.3% is leasehold
and 33.7% is in
Managed Stores.
The overall adjusted Same Store
EBITDA margin across all stores decreased to 58.9% from
60.3%. Adjusted Same Store EBITDA margins of the freehold
stores increased to 66.0% (31.1.2023: 64.7%).
As the business develops the
balance of the stores continues to shift towards landmark freehold
stores and managed stores which have a higher-than-average adjusted
store EBITDA margin at 62.8% and 100% respectively versus 55.3%
across all stores.
|
|
|
|
|
|
When Fully Developed
|
Portfolio Analysis and Performance
Breakdown
|
Number of
stores
|
% of
Property
Valuation
|
% of Adjusted
Store EBITDA
|
Adjusted
Store
EBITDA Margin
(%)
|
% lettable
space
|
Number of
stores
|
Total % lettable
space
|
As at 31 January 2024
|
|
|
|
|
|
|
|
Freehold Stores
|
17
|
83.7
|
74.1
|
62.8
|
46.0
|
25
|
51.2
|
Leasehold Stores
|
10
|
7.0
|
25.9
|
41.2
|
20.3
|
10
|
17.4
|
Managed Stores
|
16
|
-
|
-
|
100.0
|
33.7
|
18
|
31.3
|
Total stores trading
|
43
|
|
|
|
100.0
|
53
|
100.0
|
Pipeline Stores (secured)*
|
|
|
|
|
|
|
|
Owned - Freehold
|
8
|
9.3
|
-
|
-
|
-
|
-
|
-
|
Owned - Leasehold
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Managed
|
2
|
-
|
-
|
-
|
-
|
-
|
-
|
Total secured Pipeline Stores
|
10
|
-
|
-
|
-
|
-
|
-
|
-
|
Total Stores
|
53
|
100
|
100
|
55.3
|
100
|
53
|
100
|
*Applies to the
10 contracted
stores only.
Analysis of Stores
|
No
of
|
Stores
|
Stores
|
Pipeline
|
As
at 31 Jan 2024
|
Stores/Sites
|
Trading
Lok'nStore
|
Trading
Managed
|
Total
|
Freeholds
|
17
|
17
|
-
|
-
|
Leaseholds
|
10
|
10
|
-
|
-
|
Pipeline (Freehold)
|
8
|
-
|
-
|
8
|
Pipeline (Leasehold)
|
-
|
-
|
-
|
-
|
Sub-total 'Owned Stores'
|
35
|
27
|
-
|
8
|
Managed Stores (Trading)
|
16
|
-
|
16
|
-
|
Managed Stores (Pipeline)
|
2
|
-
|
-
|
2
|
Sub-total 'Managed Stores'
|
18
|
-
|
16
|
2
|
Total No. of Stores.
|
53
|
27
|
16
|
10
|
MLA
sq. ft.
|
2,781,454
|
1,424,098
|
775,947
|
581,409
|
The freehold stores produce
74.1% (31.1.2023: 72.1%)
of the Adjusted store EBITDA and account for 93.0% (31.1.2023: 92.3%) of valuations (including secured pipeline
stores).
Leaseholds trade on lower margins
due to the rent payable, but nevertheless the 41.2% margin achieved is attractive
and leads to a higher return on capital than the freehold stores
which require much larger capital expenditure to buy the land and
buildings.
Operating Performance at a glance (Lok'nStore freehold and
leasehold stores only)
In the Operating Performance table
below, we show how the performance breaks down across the stores,
based on the age of store. Older stores have had more time to
fill-up and produce higher EBITDA returns.
Weeks Old
|
Secured
Pipeline
|
Under 100
|
100 to 250
|
Over 250
|
Total
|
Six months ended 31 January 2024
|
|
|
|
|
|
Sales £000
|
|
818
|
1,239
|
11,320
|
13,377
|
Stores Adjusted EBITDA
£'000
|
|
(319)
|
722
|
6,994
|
7,397
|
Adjusted EBITDA Margin (%)
|
|
(39.0)%
|
58.3%
|
61.8%
|
55.3%
|
Stores Adjusted EBITDAR
£'000
|
|
(196)
|
722
|
7,956
|
8,482
|
Adjusted EBITDAR Margin (%)
|
|
(24.0)%
|
58.3%
|
70.3%
|
63.4%
|
As at 31 January 2024 (sq.
ft.)
|
|
|
|
|
|
Maximum Net Area
|
-
|
320
|
215
|
888
|
1,909
|
Freehold / Long leasehold ('000 sq.
ft.)
|
486
|
270
|
215
|
453
|
1,424
|
Short Leasehold (sq.
ft.)
|
-
|
50
|
-
|
435
|
485
|
Number of Stores
|
|
|
|
|
|
Freehold / Long
Leasehold
|
8
|
4
|
3
|
10
|
25
|
Short Leasehold
|
-
|
1
|
-
|
9
|
10
|
Total Stores
|
8
|
5
|
3
|
19
|
35
|
Managed Store Revenue
Lok'nStore manages an increasing
number of stores for third party owners. Under this model,
Lok'nStore can provide a turnkey package for investors wishing to
own trading self-storage assets. The investor supplies the capital
for the project which Lok'nStore manages. Lok'nStore will buy,
build and operate the stores under the Lok'nStore brand and within
our current management structure.
For Managed Stores Lok'nStore
receives a standard monthly management fee, a performance fee based
on certain return hurdles and fees on a successful exit. We also
charge acquisition, planning and branding fees. This allows
Lok'nStore to earn revenue from our expertise and knowledge of the
self-storage industry without committing our capital. We can
amortise various fixed central costs over a wider operating base
and direct more visits to our website, moving it up the internet
search rankings and benefitting all the stores we both own and
manage.
This strategy improves the risk
adjusted return of the business by increasing the operating
footprint, revenues and profits without committing capital. There
is a strong correlation between the total management fee income and
the number of stores under management.
We now manage in excess of
£150 million of
assets under this structure on which we generated managed store
income of £0.8 million this period (31.01.2023: £0.8 million). Within this,
recurring fees were broadly flat, and we expect base management
fees to increase steadily over the coming years as as the Managed
Stores mature. As more Managed Stores are opened this will also
increase base management fees.
Managed Store income is generated
from our existing platform and central management, resulting in an
effective margin from this activity of 100%. Non-recurring fees are positive for Lok'nStore but are
irregular in their nature. Income from non-recurring fees was down
in the period to £0.03 million (31.01.2023: £0.06
million).
At the period-end, we had 16
Managed Stores operating. The Kettering store recently opened after
the period -end in February 2024 making 17 stores trading, When the
Bromborough site, which is currently being built opens in the
Autumn, we will have 18 Managed Stores trading..
Management fees
|
Percentage
Increase/
(decrease)
|
Group
Period
ended
31 January
2024
|
|
Group
Period
ended
31
January 2023
|
|
Group
Year
ended
31 July
2023
|
|
%
|
£
|
|
£
|
|
£
|
Recurring fees
|
|
|
|
|
|
|
Base management fees
|
|
484,693
|
|
469,564
|
|
929,810
|
Administration and compliance
fees
|
|
52,500
|
|
52,500
|
|
105,000
|
Enhanced Management
fees
|
|
212,401
|
|
239,543
|
|
434,280
|
Recurring fees -
Sub-total
|
(1.6%)
|
749,594
|
|
761,607
|
|
1,469,090
|
Non-recurring fees
|
|
|
|
|
|
|
Construction & Advisory
fees
|
|
30,000
|
|
-
|
|
30,000
|
Supplementary fees
|
|
-
|
|
60,000
|
|
160,000
|
Non-recurring fees
|
(50.0%)
|
30,000
|
|
60,000
|
|
190,000
|
Total management fees
|
(5.1)%
|
779,594
|
|
821,607
|
|
1,659,090
|
Total Assets and Net Asset
Value
·
Adjusted Total Assets £384.2 million4
up 8.83% on last year (31.1.2023: £353.0) (31.7.2023: £392.9
million)
·
Adjusted Net Asset Value (NAV) per
share5 January to January up 7.87% to £9.87
(31.1.2023: £9.15)
·
Adjusted Net Asset Value (NAV) per share up 0.1%
from 31 July 2023 (£9.86)
·
Investment in new stores £18.5 million (including capitalised
interest) (31.1.2023: £8.3
million)
·
Value of operating stores £305.4 million up 17.0%
on last year (31.1.2023: £261.1)
The value of adjusted total assets
of £384.2 million (31.01.2023: £353.0 million) is calculated by
adding the valuation of the leasehold properties less their
corresponding net book value to the other assets in the business.
This provides clarity on the significant value of the leasehold
stores as trading businesses which under accounting rules on leases
are only presented at their book values within the Statement of
Financial Position. For the detailed calculation refer to Note 4 on
the Key Performance Indicator section.
We have reported by way of a note
the underlying value of these leasehold stores in revaluations and
adjusted our Net Asset Value (NAV) calculation accordingly to
include their value. This ensures comparable NAV
calculations. An analysis of the
valuations achieved is set out in the table below.
Analysis of Total Property Value
|
No of
store
/sites
|
31 Jan 2024
Valuation
£'000
|
No of
stores
/sites
|
31 Jan
2023 Valuation
£'000
|
No of
stores
/sites
|
31 July
2023 Valuation
£'000
|
Freeholds3 valued by JLL
1
|
17
|
274,725
|
15
|
254,775
|
17
|
274,725
|
Directors' Valuation
Adjustment
|
|
-
|
|
(16,650)
|
|
-
|
Fair value of freehold
stores
|
|
274,725
|
|
238,125
|
|
274,725
|
Leaseholds valued by JLL
2
|
9
|
27,200
|
9
|
24,250
|
9
|
27,200
|
Directors' Valuation
Adjustment
|
|
-
|
|
(1,300)
|
|
-
|
Leaseholds open and trading to be
valued by JLL 3
|
1
|
3,510
|
|
|
|
|
Fair value of leasehold
stores
|
|
30,710
|
|
22,950
|
|
27,200
|
Subtotal
|
27
|
305,435
|
24
|
261,075
|
26
|
301,925
|
Sites in development at
cost 4
|
8
|
45,217
|
10
|
36,393
|
9
|
30,605
|
Subtotal 5
|
35
|
350,652
|
34
|
297,468
|
35
|
332,530
|
Freehold land & Buildings at
Director valuation
|
1
|
1,500
|
1
|
1,500
|
1
|
1,500
|
Total
|
36
|
352,152
|
35
|
298,968
|
36
|
334,030
|
1 Includes related fixtures and fittings
(refer to note 11)
2
The nine leaseholds valued by JLL are all within
the terms of the Landlord and Tenant Act (1954) giving a degree of
security of tenure. The average length of the leases on the
leasehold stores valued was 12
years and 10 months at the date of the July 2023
valuation.
3 Basildon store now open and trading and will be
valued in accordance with Group valuation policy at the next 31
July 2024 year-end valuation. Currently held at cost.
4 Includes £1.27
million of capitalised interest during the
period. (31.01.2023: £0.66 million) (31.07.2023:
£1.54
million).
5 Loan to value calculation based on these
property values.
Total freehold properties account
for 91.9% of all
property values (31.1.2023: 92.5%).
Market Valuation of Freehold and Leasehold Land and
Buildings
It is the Group's usual policy to
commission an independent external valuation of its properties at
each financial year-end. Our freehold and leasehold stores were
independently valued by JLL at £301.9 million at 31 July
2023.
Valuations
Except for the forthcoming closure
of the Sunbury leasehold store, it is not the current intention of
the Directors to make any further significant disposals of trading
stores, although individual asset disposals may be considered where
value can more easily be added by recycling the capital into new
stores.
The valuations of our freehold
property assets are included in the Statement of Financial Position
at their fair value. The value of our leasehold stores
independently valued by JLL at 31 July 2023 totals
£27.2 million
(31.07.2023: £27.2
million) but they are held at cost less accumulated depreciation in
the Statement of Financial Position.
Our freehold and leasehold stores
were independently valued by JLL at £301.9 million at 31 July 2023.
The value of adjusted total assets of £384.2
million4 (31.07.2023: £392.9 million) is calculated by
adding the valuation of the leasehold properties of £27.2 million
less their corresponding net book value of £6.9 million to the
total assets in the Statement of Financial Position of £363.9
million. This provides clarity on the value of the leasehold stores
as trading businesses which under the Group's accounting policy
rules on leases are only presented at their book values within the
Statement of Financial Position.
At the period-end, Lok'nStore had
43 stores trading. Of these, 27
stores are Owned with 17 freeholds, 10 leasehold and
16 stores under management contracts. After the
period-end Kettering opened in early February, taking the total of
Managed Stores to 17 and 44 stores trading.
The average unexpired term of the
Group's operating leaseholds is approximately 12 years and 4 months
at 31 January 2024. All of our
leasehold stores are inside the Landlord and Tenant Act providing
us with a strong degree of security of tenure.
A deferred tax liability arises on
the revaluation of the properties and on the rolled-over gain
arising from the disposal of some properties. It is not
envisaged that any tax will become payable in the foreseeable
future on these disposals due to the availability of rollover
relief.
.
We have reported by way of a note
the underlying value of these leasehold stores in revaluations and
adjusted our Net Asset Value (NAV) calculation accordingly to
include their value. This ensures comparable NAV
calculations.
Investment in new stores
We have invested £18.5 million
(31.01.2023: £8.25 million) in new store development in this
period.
Landmark Store Pipeline
Our current pipeline of ten
contracted stores will add 26.4% of extra trading space to the
overall portfolio, 34.1% to our Owned portfolio and 12.3% to the
Managed portfolio.
The Kettering managed store opened
post period end on 9th February 2024. We are on-site at
two further stores that will open during 2024.
All 10 stores in our Secured Pipeline9 are in prominent locations
with large catchment areas
and demonstrate the
Group's ability to source high-quality sites. These eye-catching
buildings, with their distinctive orange Lok'nStore branded livery
and prominent signage, create highly visible landmarks, which
continue to be a big source of new customers.
Beyond the stores currently on
site, we have a further 7 stores in our pipeline. In the
period we received planning permission for our site at Barking.
Post period-end we have achieved planning at Eastbourne and
Cheshunt. Bournemouth, Milton Keynes and Altrincham all have
live planning applications submitted.
Summary of our contracted pipeline at 31 January
2024:
Store
|
|
Size
sq. ft
|
Status
|
On-site at
31 Jan 2024
Size sq. ft
|
|
On site after
30 April 2024
Size sq. ft
(Additional)
|
Kettering
|
Managed
|
45,900
|
Onsite - (opened 9th
February 2024)
|
45,900
|
|
|
Staines
|
Long
Leasehold
|
66,500
|
On site - target opening May
2024
|
66,500
|
|
|
Bromborough
|
Managed
|
49,500
|
Onsite - Target opening Autumn
2024
|
49,500
|
|
|
Bolton
|
Freehold
|
57,578
|
Planning granted
|
|
|
57,578
|
Barking
|
Freehold
|
84,200
|
Planning granted
|
|
|
84,200
|
Cheshunt
|
Freehold
|
60,300
|
Planning granted
|
|
|
60,300
|
Eastbourne
|
Freehold
|
60.000
|
Planning granted
|
|
|
60,000
|
Bournemouth
|
Freehold
|
75,100
|
Further Planning application
submitted
|
|
|
75,100
|
Altrincham
|
Freehold
|
63,900
|
Further Planning application
submitted
|
|
|
63,900
|
Milton Keynes
|
Freehold
|
60,000
|
Planning application
submitted
|
|
|
60,000
|
Total - 10 stores
|
|
622,978
|
|
161,900
|
|
461,078
|
Closure of Sunbury Leasehold Store
In line with our continuing
strategy of recycling older stores into purpose-built Landmark
stores and leases into freeholds, we will close the Sunbury
leasehold store in early FY25. Our policy over many years has
been that we are happy with leasehold stores which provide a higher
return on capital than freeholds, but that we prefer
freeholds. Over the years we have both bought out the
freeholds of existing leasehold stores and also built new freehold
stores elsewhere and moved the customers from the leasehold to the
freehold store.
The move from an older building to
a new purpose-built Landmark store improves our brand image to our
customers, removes latent capital expenditure and further reduces
our environmental impact. The move from a leasehold to an effective
freehold also reduces operational gearing by removing the property
rental charge.
In this case the closure of the
Sunbury store has been timed to coincide with the opening of our
new store in Staines a few miles away in Spring 2024. The Staines
store is an effective freehold, being on a 250-year lease at
peppercorn rent. We expect to move a number of the current
Sunbury customers to the new Staines store and other local freehold
stores. Therefore, we expect the new
Staines store to be trading cash positively quickly. As the lease
of the Sunbury store expired in August 2022, the store was valued
at £0 in the July 2023 valuation.
The closure will result in a
modest reduction in the expected Group Revenue in the coming years.
In FY23, the Sunbury store generated £1.3 million in revenue and
£0.6 million of EBITDA.
Environmental Targets. Commitments and
Performance:
Lok'nStore remains committed to
positively impacting the environment.
At 31 July 23, Lok'nStore set
targets in line with its Environmental Committee's
objectives.
These targeted objectives
are:
·
Decarbonise our business to be Net Zero in our
operations by 2040
·
Assess recommended improvements from current EPCs
and action as appropriate
·
Trial the installation of a battery at one
store
·
To increase the number of stores with
PV systems
·
Continue the roll out of LED lights for all
stores
·
Obtain BREEAM accreditation at one
store
·
Determine a route to eliminate waste destined
for landfill
Lok'nStore is pleased to announce
progress on all of these targets. A comprehensive analysis of the
remaining direct emissions is currently underway, with efforts
directed towards establishing a pathway to lower the current target
of being Net Zero in our operations by 2040.
Substantial progress has been made
in enhancing the ratings across our existing Energy Performance
Certificates (EPC's), with 89% of the freehold portfolio now
achieving a rating of B or above.
We remain focused on advancing
battery storage solutions and continue to work on defining
implementation strategies. In the first half of the year, we have
identified stores that are yet to benefit from LED lighting and
have prioritised their conversion. Additionally, we maintain our
initiative to install photovoltaic (PV) systems on all new
buildings, with the addition of two new stores to our PV portfolio
by year end.
As highlighted in the most recent
Annual Report, Lok'nStore has diligently monitored waste management
for several years, resulting in a noteworthy reduction in landfill
waste during this period. The next phase of this initiative
involves determining a viable route to eliminate waste destined for
landfill.
Collaborative efforts with our
suppliers have been initiated to enhance reporting on waste volumes
and destinations. The identification of remaining stores in the
portfolio where waste disposal still involves destination being
landfill is underway, with a focus on rerouting waste. Further
progress on this will be reported in full at 31 July
2024.
We are committed to environmental
certification for our buildings and are progressing BREEAM
accreditation at our Kettering store, on behalf of the managed
store owner. We continue to make progress on this accreditation for
our pipeline of new stores where appropriate.
Financial results:
Headline
ü Group
Revenue £14.17 million up 4.3% (31.01.2023: £13.58
million)
ü Group
Adjusted EBITDA1 £7.65 million down 3.6% (31.01.2023:
£7.93 million)
ü Cash
available for Distribution (CAD)3 £5.17 million down
1% (31.01.2023: £5.2
million) (31.07.2023: £9.13 million)
ü Cash
available for Distribution of 16.0 pence per share (31.01.2023:
17.7 pence per share)
ü Cash
balances £15.0 million (31.07.2023: £42.1
million)
ü £100
million Bank RCF runs to April 2026
Revenue
Total Group Revenue for the year
was £14.17 million, an increase of £0.6 million and up
4.3% from
£13.58 million in
the prior period. Same Store Revenue for the year was
£13.93 million,
an increase of 2.6% (31.01.2023: £13.58 million). Same Store Self Storage
Revenue was £13.09 million up 3.1% (31.01.2023: £12.70
million)
Operating Costs
Of the £0.87 million increase in
operating costs in the period, £0.45 million relates to the
operating costs of the new stores in Bedford, Peterborough and
Basildon. The Basildon Store is a leasehold and therefore includes
a rent of £0.1 million in the period.
On a Same Store basis, costs have
increased by £0.43 million or 7.7%. Of this £0.39 million
relates to property cost increases. More
specifically:
·
Rent costs increased by £93,417 (10.7%) following
settled rent reviews at two existing leasehold stores over the last
12 months. These stores rents are now fixed for the next 5 years.
In addition, the Basildon leasehold rent commenced during the
period.
·
Energy costs increased by £81,041 (10.6%).
These will decline markedly in the coming year
·
Business rates increased by £53,998
(5.7%)
·
Insurance costs decreased by 10.2% period to
period
Total staff costs, increased by
6.5% as we staffed the new stores which was offset by lower
performance bonuses to our store colleagues. On a Same Store basis,
total staff costs, increased by just 0.7%. There was also a lower
national insurance cost because of the combined effects of lower
bonuses paid and fewer share options exercised by management and
staff in the year.
From FY25, we expect operating
costs to revert to a slower rate of growth with cost increases
driven mainly by the expansion of the business.
Banking, net debt and liquidity
ü RCF of
£100 million and runs to April 2026
ü £18.5*
million invested in new store pipeline (31.07.2023: £17.3
million)
ü Net
debt (excluding leases) £28.8 million (31.07.2023: £12.3 million)
ü Loan to
Value ratio (LTV) net of cash 8.3% (31.07.2023: 3.7%)
ü Cost of
floating debt averaged 6.72% in the
period (31.07.2023: 4.8%) on £33.8 million debt
(31.07.2023:
£54.4 million)
ü All-in
cost of fixed (swap) on £10 million debt averaged 5.2% in the period
* Includes £1.27 million of
capitalised interest
The Group's RCF of £100 million is
a joint agreement with ABN AMRO NV and NatWest Bank plc
participating equally and runs until April 2026 providing funding
for more Landmark site acquisitions. The Group is fully compliant
with the two principal bank covenants (LTV and Senior
Interest).
Reduction of debt (RCF)
On 11 August 2023, the Group paid
down £19.02 million out of its recent equity placing proceeds
reducing the balance on its RCF, pending redrawing over time for
its future deployment on the Group's pipeline stores.
Interest expense and bank borrowings
The Group pays a margin of 1.5% on
its Interest and the all-in effective rate is calculated by
reference to SONIA (Sterling Over Night Indexed Average) plus
margin.
·
Average cost of floating debt 6.72% (31.07.2023:
4.8%)
·
Average cost of debt (on active revolving loans
at 31 January 2024) 6.6%
(31.07.2023: 6.2%)
·
Current cost of debt at date of this
Report 6.6%
Management of Interest Rate Risk
The
Board's strategy has been to regularly review the Group's interest
rate hedging position and to monitor prevailing SONIA and swap rates with a view to
fixing a proportion of its floating debt when the time was
considered opportune.
In December 2023, the Group
entered into a £5.0 million interest rate swap with ABN Amro Bank
effective from 21 December 2023 at a fixed 5-year SONIA swap rate
of 3.51%. Also, in December 2023 the Group entered into a £5
million interest rate swap with Nat West Bank plc effective from 22
December 2023 at a fixed 5-year SONIA swap rate of 3.51%. This £10
million of aggregate swap instruments fixes the interest rate on
£10.0 million of debt at an effective rate
of 5.21% based on current 150 basis points (bps) margin and
will result in estimated saving of c. £0.2
million of interest payable in the coming year compared to the
company's current cost of floating debt of 6.72% on its Revolving
Credit Facility.
Lok'nStore has £43.8 million
currently drawn against its £100 million revolving credit facility
of which £10 million is now at a fixed interest rate. This leaves a
balance of £33.8 million floating at a current all-in rate of
around 6.6%. The £10 million fixed rate is
treated as an effective cash flow hedge and its fair value stated
as a liability. (See Note 17b).
Lok'nStore generates its cash flow
from its strong asset base with a low LTV net of
cash of 8.3%. The value of the Group's
assets underpins a resilient business model with stable and rising
cash flows and low credit risk giving the business a firm
base.
The gross bank interest expense
(before capitalisation of interest costs, non-utilisation fees and
loan amortisation fees) for the period was £1.27 million
(31.1.2023: £1,34 million) (31.07.2023: £3.11 million), due to
higher average debt and higher average costs of borrowing. These
average costs of borrowing is currently running at 6.6%.
The Group continues to monitor
closely the effects of rising interest rates on its Senior Interest
covenant, which is tested on a 12-month rolling basis, and the
Group's flexible business model will enable it to take appropriate
steps to mitigate its effects should it be required. Capitalised
interest in the period on our store development programme was £1.27
million (31.1.2023: £0.66 million) (31.07.2023: £1.54 million).
Total finance costs in the Statement of Comprehensive Income were
£0.6 million (31.01.2023: £1.0 million) (31.07.2023: £2.56
million).
As agreed with the banks, both the
Loan to Value and Senior Interest covenants set out in our bank
facility continue to be tested excluding the effects of IFRS 16.
For covenant calculation purposes, debt / LTV will continue to
exclude right of use assets and the corresponding lease liabilities
created by IFRS 16. When testing the Senior Interest Covenant,
property lease costs will continue to be a deduction in the
calculation of EBITDA, in accordance with the accounting principles
in force prior to 1 January 2019.
Derivative financial instruments and hedge
accounting
The Group's activities expose it to
interest rate risk. The Group uses interest rate swap
contracts to hedge these exposures. The Group does not use
derivative financial instruments for speculative or for any other
purposes.
The use of financial derivatives is
governed by the Group's policies as approved by the board of
directors. The Group documents its risk
management objectives and strategy for undertaking hedging
transactions within the Group's Risk Register. The Group also
documents its assessment both at hedge inception and on an on-going
basis to assess whether the derivatives that are used are effective
in offsetting changes in fair value or cash flows of the hedged
items.
Derivative financial instruments are
measured at fair value and the fair values of the hedged derivative
instruments are disclosed in note 17b. Movements on the hedging
reserve in other comprehensive income are shown in note 24. The
full fair value of a hedging derivative is classified as a
non-current asset or liability when the remaining hedged item has
more than 12 months to run, and as a current asset or liability
when the remaining maturity of the hedged item is less than 12
months.
Instruments quoted in an active
market are measured at their current bid price. For
instruments that are not quoted in an active market, the fair value
is estimated using a valuation technique. Techniques that are
used by the Group include comparisons to recent market transactions
or reference to other instruments which are substantially the same,
discounted cash flow analysis and option pricing models.
Inputs to such techniques rely on market inputs where such
information is readily available.
Cash flow hedges
Hedges of exposures to variable cash
flows attributable to a particular risk associated with a
recognised asset or liability or a highly probable forecast
transaction that could affect profit or loss are accounted for as
cash flow hedges when the hedging criteria has been achieved.
The Group uses cash flow hedges to account for the hedging of
variable rate borrowings. The effective portion of
changes in the fair value is recognised in other comprehensive
income whilst the gain or loss on the ineffective portion is
recognised immediately in profit or loss.
Amounts accumulated in other
comprehensive income are recycled to profit or loss in the periods
when the hedged item affects profit or loss. However, when a
forecast transaction that is hedged results in the recognition of a
non-financial asset, the gains and losses previously deferred into
other comprehensive income are transferred from other comprehensive
income and included in the initial measurement of the cost of the
asset.
Cash flow and
financing
At 31 January 2024, the Group had
cash balances of £15.0 million (31.07.2023: £42.1
million). Cash inflow from operating activities
before investing and financing activities was £7.1
million (31.01.2023:
£7.8 million). As well as using cash
generated from operations to fund some capital expenditure, the
Group's £100 million five-year Revolving Credit Facility provides
sufficient liquidity for the Group's current needs.
Undrawn committed facilities at the period-end amounted to
£56.3 million
(31.07.2023: £45.6 million). Cash plus
undrawn committed facilities amounts to £71.3 million, leaving the business
with plenty of headroom.
Earnings per share
Basic earnings per share
were 9.12 pence
(31.1.2023: 12.38 pence
per share) and diluted earnings per share were 9.06
pence (31.1.2023: 12.17
pence per share).
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Total profit for the financial
year attributable to owners of the parent
|
2,937
|
3,651
|
4,692
|
Weighted average number of
shares
|
No. of
shares
|
No. of
shares
|
No. of shares
|
For basic earnings per
share
|
32,189,583
|
29,479,779
|
29,518,911
|
Dilutive effect of share
options
|
207,735
|
520,042
|
467,137
|
For diluted earnings per
share
|
32,397,318
|
29,999,821
|
29,986,048
|
623,212 shares (31.01.2023:
623,212) are held in the Employee Benefit Trust, and these are
excluded from the above
calculation.
Earnings per share attributable to owners of the
Parent
|
Six months
ended
31 January
2024
Unaudited
|
Six
months
ended
31
January
2023
Unaudited
|
Year
ended
31
July
2023
Audited
|
Earnings per share - Basic
|
|
|
|
Basic earnings per
share
|
9.12p
|
12.38p
|
15.90p
|
Earnings per share - Diluted
|
|
|
|
Total diluted earnings per
share
|
9.06p
|
12.17p
|
15.65p
|
Cash Available for Distribution
ü Cash
Available for Distribution of 16.0 pence per share (31.01.2023:
17.7 pence per share)
ü Cash
Available for Distribution £5.17 million (31.01.2023: £5.21
million)
CAD provides a clear picture of
ongoing cash flow available for dividends, new store development or
debt repayment.
The table below shows the
calculation of CAD
Analysis of Cash Available for Distribution
(CAD)
|
Period
ended
31 January 2024
£'000
|
Period
ended
31
January 2023
£'000
|
Year
ended
31 July
2023
£'000
|
Group Adjusted EBITDA
(Per Statement of Comprehensive
Income)
|
7,647
|
7,931
|
15,056
|
Adjustment for property lease
rentals
|
(885)
|
(871)
|
(1,817)
|
Net finance costs paid
|
(877)
|
(1,135)
|
(2,664)
|
Capitalised maintenance
expenses
|
(110)
|
(11)
|
(121)
|
New Works Team
|
(42)
|
(35)
|
(76)
|
Current tax (Note 8)
|
(559)
|
(671)
|
(1,245)
|
Total deductions
|
(2,473)
|
(2,722)
|
(5,923)
|
Cash Available for Distribution
|
5,174
|
5,208
|
9,133
|
(Decrease) in CAD over last year
£
|
(34)
|
(369)
|
(2,258)
|
(Decrease) / increase in CAD over
last period / year %
|
(1.0%)
|
(6.6%)
|
(19.8%)
|
|
Number
|
Number
|
Number
|
Closing shares in issue (less shares
held in EBT and treasury)
|
32,271,931
|
29,422,990
|
32,144,246
|
CAD per share
|
16.0p
|
17.7p
|
28.4p
|
(Decrease) / increase in CAD per
share over last period / year
|
(9.4%)
|
57.2%
|
(26.6%)
|
Taxation
The Group has made a current tax
provision against earnings in this period of £0.6 million (31.07.2023: £1.2 million)
based on a corporation tax rate of 25%. (31.07.2023: 8 months at 19%, 4 months at
25%).
The deferred tax provision which
is calculated at forward corporation tax rates of 25% is
substantially a tax provision against the potential crystallisation
(sales) of revalued properties and past 'rolled over' gains and
amounts to £67.4 million
(31.07.2023: £66.3
million).
Gearing11
(Excluding
IFRS16 Lease Liabilities)
At 31 January 2024, the Group had
£43.7 million of gross bank borrowings (31.07.2023: £54.4 million) and cash of
£15.0 million (31.07.2023: £42.1 million)
representing gearing of 12.5%
(31.07.2023: 5.3%) on net assets of £230.9
million (31.07.2023: £230.5
million).
Capital Expenditure
The Group has an active new store
development programme, and has grown through a
combination of building new stores, existing store improvements and
relocations.
Capital expenditure during the
period totalled £18.5 million. This was primarily the contract exchange of
the Milton Keynes site, the purchase of the Eastbourne
site and the completion monies passing to the
developer for completing the Staines building prior to its fit-out.
There are ongoing construction and fit out works at our sites
in Staines and Basildon, final costs
on Bedford and Peterborough. Planning and
pre-development works at our Bournemouth, Altrincham, Barking and
Cheshunt sites also featured.
The Group has capital expenditure
contracted but not provided for in the financial statements of
£4.27 million (31.07.2023: £13.1 million).
We carefully evaluate the ongoing
economic and trading position before making any further capital
commitments and can reduce capex quickly if the market
deteriorates.
Lok'nStore has a good credit
model, with low debt and gearing and which is strongly cash
generative from an increasing asset base. Increased bank
facilities, on competitive margins, and extended to April 2026,
positions the business well for the future.
Statement of Financial Position
Group net assets at the period-end
were £230.9 million, up 0.2% (31.07.2023: £230.5
million)
Market Valuation of Freehold and Leasehold Land and
Buildings
It remains the Group's usual
policy to undertake a comprehensive external valuation at each
year-end and we would normally do so at the next year-end at 31
July 2024, however following "the
Offer" the
Scheme Document will include a valuation in
respect of Lok'nStore's property
portfolio in
accordance with Rule 29 of the code.
Adjusted Net Asset Value Per Share
Adjusted Net Assets per Share are
the net assets of the Group adjusted for the valuation of leasehold
stores and deferred tax divided by the number of shares at the
period-end. The shares currently held in the Group's Employee
Benefits Trust (own shares held) and in treasury (zero) are
excluded from the number of shares.
At 31 January 2024, the Adjusted
Net Asset Value per share (before deferred tax) increased
0.1% to £9.87 from £9.86 at 31 July 2023.
last year. Adjusted Net Asset Value per share (before deferred tax)
increased 78.7% compared to £9.15 at 31
January 2023.
This year-on-year increase is a
result of higher property values on our existing stores as the
strength of our Landmark stores is recognised, combined with cash
generated from operations less dividend payments, offset in part by
an increase in the shares in issue due to the exercise of a small
number of share options during the period.
Analysis of net asset value (NAV)
|
31
Jan
2024
£'000
Unaudited
|
31
Jan
2023
£'000
Unaudited
|
31
July
2023
£'000
Audited
|
Net assets
Adjustment to include
operating/short leasehold stores at valuation
Add: JLL leasehold
valuation
Deduct: leasehold properties and
their fixtures and fittings at NBV
|
230,886
27,200
(6,891)
|
193,674
22,950
(7,039)
|
230,472
27,200
(6,952)
|
|
251,195
|
209,585
|
250,720
|
Deferred tax arising on
revaluation of leasehold properties1
|
(5,077)
|
(3,978)
|
(5,062)
|
Adjusted net assets
|
246,118
|
205,607
|
245,658
|
|
|
|
|
Shares in issue
|
Number
'000
|
Number
'000
|
Number
'000
|
|
|
|
|
Opening shares in issue
Shares issued for the exercise of
options
|
32,767
128
|
30,004
42
|
30,004
83
|
Shares issued from primary
placing
|
-
|
-
|
2,680
|
Closing shares in issue
Shares held in EBT
|
32,895
(623)
|
30,046
(623)
|
32,767
(623)
|
Closing shares for NAV
purposes
|
32,272
|
29,423
|
32,144
|
Adjusted net asset value per share
after deferred tax provision
|
£7.62
|
£6.99
|
£7.64
|
Adjusted net asset value per share before deferred tax
provision
|
|
|
|
Adjusted net assets (see
above)
|
246,118
|
205,607
|
245,658
|
Deferred tax liabilities and
assets recognised by the Group
|
67,449
|
59,535
|
66,290
|
Deferred tax arising on
revaluation of leasehold
properties1
|
5,077
|
3,978
|
5,062
|
Adjusted net assets before
deferred tax
|
318,644
|
269,120
|
317,010
|
Closing shares for NAV
purposes
|
32,272
|
29,423
|
32,144
|
Adjusted net asset value per share
before deferred tax provision
|
£9.87
|
£9.15
|
£9.86
|
1 A
deferred tax adjustment in respect of the uplift in the value of
the leasehold properties has been included. Although this is a
memorandum adjustment as leasehold properties are included in the
Group's financial statements at cost and not at valuation, this
deferred tax adjustment is included in the adjusted net asset value
calculation in order to maintain a consistency of tax treatment
between freehold and leasehold properties.
Neil
Newman
Ray
Davies
Group Managing Director
Group Finance Director
Environmental Targets. Commitments and
Performance:
Lok'nStore remains committed to
positively impacting the environment. At 31 July 23, Lok'nStore set targets in line with its
Environmental Committee's objectives.
These targeted objectives
are:
·
Decarbonise our business to be Net Zero in our
operations by 2040
·
Assess recommended improvements from current EPCs
and action as appropriate
·
Trial the installation of a battery at one
store
·
To increase the number of stores with
PV systems
·
Continue the roll out of LED lights for all
stores
·
Obtain BREEAM accreditation at one
store
·
Determine a route to eliminate waste destined
for landfill
Lok'nStore is pleased to announce
progress on all of these targets. A comprehensive analysis of the
remaining direct emissions is currently underway, with efforts
directed towards establishing a pathway to lower the current target
of being Net Zero in our operations by 2040.
Substantial progress has been made
in enhancing the ratings across our existing Energy Performance
Certificates (EPC's), with 89% of the freehold portfolio now
achieving a rating of B or above.
We remain focused on advancing
battery storage solutions and continue to work on defining
implementation strategies. In the first half of the year, we have
identified stores that are yet to benefit from LED lighting and
have prioritised their conversion. Additionally, we maintain our
initiative to install photovoltaic (PV) systems on all new
buildings, with the addition of two new stores to our PV portfolio
by year end.
As highlighted in the most recent
Annual Report, Lok'nStore has diligently monitored waste management
for several years, resulting in a noteworthy reduction in landfill
waste during this period. The next phase of this initiative
involves determining a viable route to eliminate waste destined for
landfill.
Collaborative efforts with our
suppliers have been initiated to enhance reporting on waste volumes
and destinations. The identification of remaining stores in the
portfolio where waste disposal still involves destination being
landfill is underway, with a focus on rerouting waste. Further
progress on this will be reported in full at 31 July
2024.
We are committed to environmental
certification for our buildings and are progressing BREEAM
accreditation at our Kettering store, on behalf of the managed
store owner. We continue to make progress on this accreditation for
our pipeline of new stores where appropriate.
Consolidated Statement of Comprehensive
Income
For the six months ended 31 January 2024
|
Notes
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Revenue
|
1
|
14,168
|
13,583
|
27,147
|
|
|
|
|
|
Total property, staff, distribution and general
costs
|
2
|
(6,521)
|
(5,652)
|
(12,091)
|
Group Adjusted EBITDA1
|
|
7,647
|
7,931
|
15,056
|
Depreciation
|
7
|
(2,743)
|
(2,463)
|
(5,690)
|
Equity settled share-based
payments
Non-underlying items
|
4
|
(287)
(20)
|
(225)
119
|
(450)
(318)
|
|
|
(3,050)
|
(2,569)
|
(6,458)
|
Operating profit
|
|
4,597
|
5,362
|
8,598
|
|
|
|
|
|
Finance income
|
5
|
282
|
305
|
665
|
Finance cost
|
6
|
(606)
|
(1,008)
|
(2,562)
|
|
|
|
|
|
Profit before taxation
|
|
4,273
|
4,659
|
6,701
|
Income tax expense
|
8
|
(1,336)
|
(1,008)
|
(2,009)
|
|
|
|
|
|
Profit attributable
to:
|
|
|
|
|
Owners of the parent
|
22
|
2,937
|
3,651
|
4,692
|
|
|
|
|
|
Other Comprehensive Income
|
|
|
|
|
Items that will not be
reclassified to profit and loss
|
|
|
|
|
Fair value movement in property
valuation
|
|
1,608
|
(16,057)
|
7,819
|
Deferred tax relating to change in
property valuation
|
|
(258)
|
4,014
|
(1,954)
|
Increase in fair value of cash
flow hedges
|
|
55
|
-
|
-
|
Deferred tax relating to cash flow
hedges
|
|
(14)
|
-
|
-
|
|
|
|
|
|
Other comprehensive income
|
|
1,391
|
(12,043)
|
5,865
|
|
|
|
|
|
Total comprehensive income for the period attributable to
Owners of the Parent
|
|
4,328
|
(8,392)
|
10,557
|
Earnings per share attributable to owners of the
Parent
|
Notes
|
Six months
ended
31 January
2024
Unaudited
|
Six
months
ended
31
January
2023
Unaudited
|
Year
ended
31
July
2023
Audited
|
Earnings per share Basic
|
|
|
|
|
Total basic earnings per
share
|
10
|
9.12p
|
12.38p
|
15.90p
|
Earnings per share
Diluted
|
|
|
|
|
Total diluted earnings per
share
|
10
|
9.06p
|
12.17p
|
15.65p
|
Consolidated Statement of Changes in Equity
For the six months ended 31 January 2024
Attributable to owners of the Parent
|
Share
capital
£'000
|
Share
premium
£'000
|
Other
reserves
£'000
|
Revaluation
reserve
£'000
|
Retained
earnings
£'000
|
Total
equity
£'000
|
1
August 2022 - Audited
|
301
|
11,391
|
9,102
|
129,544
|
55,008
|
205,346
|
Profit for the period
|
-
|
-
|
-
|
-
|
3,651
|
3,651
|
Other comprehensive
income
|
|
|
|
|
|
|
Increase in property valuation net
of deferred tax
|
-
|
-
|
-
|
(12,043)
|
-
|
(12,043)
|
Total comprehensive income for the
year
|
-
|
-
|
-
|
(12,043)
|
3,651
|
(8,392)
|
Transactions with
Owners
|
|
|
|
|
|
|
Dividend paid
|
-
|
-
|
-
|
-
|
(3,602)
|
(3,602)
|
Share based payments
|
-
|
-
|
225
|
-
|
-
|
225
|
Transfers in relation to share
based payments
|
-
|
-
|
(24)
|
-
|
24
|
-
|
Exercise of share
options
|
-
|
97
|
-
|
-
|
-
|
97
|
Transfer additional dep'n on
revaluation net of deferred tax
|
-
|
-
|
-
|
(432)
|
432
|
-
|
Total transactions with
owners
|
-
|
97
|
201
|
(432)
|
(3,146)
|
(3,280)
|
31 January 2023 - Unaudited
|
301
|
11,488
|
9,303
|
117,069
|
55,513
|
193,674
|
Profit for the period
(restated)
|
-
|
-
|
-
|
-
|
1,041
|
1,041
|
Other comprehensive
income
|
|
|
|
|
|
|
Increase in property valuation net
of deferred tax
|
-
|
-
|
-
|
17,908
|
-
|
17,908
|
Total comprehensive income for the
year
|
-
|
-
|
-
|
17,908
|
1,041
|
18,949
|
Transactions with
Owners
|
|
|
|
|
|
|
Dividend paid
|
-
|
-
|
-
|
-
|
(1,693)
|
(1,693)
|
Share based payments
|
-
|
-
|
225
|
-
|
-
|
225
|
Transfers in relation to share
based payments
|
-
|
-
|
(23)
|
-
|
23
|
-
|
Deferred tax credit relating to
share options
|
-
|
-
|
(358)
|
-
|
-
|
(358)
|
Primary equity placing
(gross)
|
27
|
20,473
|
-
|
-
|
-
|
20,500
|
Transaction costs of primary
placing
|
-
|
(889)
|
-
|
-
|
-
|
(889)
|
Exercise of share
options
|
1
|
63
|
-
|
-
|
-
|
64
|
Transfer additional dep'n on
revaluation net of deferred tax
|
-
|
-
|
-
|
(663)
|
663
|
-
-
|
Total transactions with
owners
|
28
|
19,647
|
(156)
|
(663)
|
(4,609)
|
17,849
|
31 July 2023 - Audited
|
329
|
31,135
|
9,147
|
134,314
|
55,547
|
230,472
|
Profit for the period
|
-
|
-
|
-
|
-
|
2,937
|
2,937
|
Other comprehensive
income
|
|
|
|
|
|
|
Increase in property valuation net
of deferred tax
|
-
|
-
|
-
|
1,350
|
-
|
1,350
|
Decrease in fair value of cash
flow hedges
|
-
|
-
|
55
|
-
|
-
|
55
|
Deferred tax relating to cash flow
hedges
|
-
|
-
|
(14)
|
-
|
-
|
(14)
|
Total comprehensive income for the
year
|
-
|
-
|
41
|
1,350
|
2,937
|
4,328
|
Transactions with
Owners
|
|
|
|
|
|
|
Dividend paid
|
-
|
-
|
-
|
-
|
(4,267)
|
(4,267)
|
Share based payments
|
-
|
-
|
286
|
-
|
-
|
286
|
Transfers in relation to share
based payments
|
-
|
-
|
(129)
|
-
|
129
|
-
|
Deferred tax credit relating to
share options
|
-
|
-
|
(108)
|
-
|
-
|
(108)
|
Exercise of share
options
|
1
|
174
|
-
|
-
|
-
|
175
|
Transfer additional dep'n on
revaluation net of deferred tax
|
-
|
-
|
-
|
(577)
|
577
|
-
|
Total transactions with
owners
|
1
|
174
|
49
|
(577)
|
(3,561)
|
(3,914)
|
31 January 2024 - Unaudited
|
330
|
31,309
|
9,237
|
135,087
|
54,923
|
230,886
|
Consolidated Statement of Financial
Position
|
Notes
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Assets
|
|
|
|
|
Non-current assets
|
|
|
|
|
Property, plant and
equipment
|
11
|
332,067
|
283,240
|
314,013
|
Right of use assets
|
12
|
13,110
|
9,712
|
13,769
|
Derivative financial
instruments
|
17b
|
55
|
-
|
-
|
|
|
345,232
|
292,952
|
327,782
|
Current assets
|
|
|
|
|
Inventories
|
13
|
131
|
132
|
145
|
Trade and other
receivables
|
14
|
3,517
|
3,738
|
2,585
|
Cash and cash
equivalents
|
|
14,975
|
40,262
|
42,132
|
Total current assets
|
|
18,623
|
44,132
|
44,862
|
Total assets
|
|
363,855
|
337,084
|
372,644
|
|
|
|
|
|
Liabilities
|
|
|
|
|
Current liabilities
|
|
|
|
|
Trade and other
payables
|
15
|
(7,450)
|
(6,893)
|
(7,180)
|
Lease liabilities
|
18
|
(992)
|
(1,295)
|
(826)
|
Taxation
|
|
(257)
|
(580)
|
-
|
Total current liabilities
|
|
(8,699)
|
(8,768)
|
(8,006)
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
Borrowings
|
17
|
(43,508)
|
(66,314)
|
(54,046)
|
Lease liabilities
|
18
|
(13,315)
|
(8,792)
|
(13,830)
|
Deferred tax
|
19
|
(67,447)
|
(59,536)
|
(66,290)
|
Total non-current liabilities
|
|
(124,270)
|
(134,642)
|
(134,166)
|
Total liabilities
|
|
(132,990)
|
(143,410)
|
(142,172)
|
Net assets
|
|
230,886
|
193,674
|
230,472
|
Equity
|
|
|
|
|
Equity attributable to owners of the parent
|
|
|
|
|
Called up share capital
|
20
|
330
|
301
|
329
|
Share premium
|
|
31,309
|
11,488
|
31,135
|
Other reserves
|
21
|
9,237
|
9,303
|
9,147
|
Retained earnings
|
22
|
54,923
|
55,513
|
55,547
|
Revaluation reserve
|
|
135,087
|
117,069
|
134,314
|
Total equity
|
|
230,886
|
193,674
|
230,472
|
|
|
|
|
| |
Approved by the Board of Directors
and authorised for issue on 19
April 2024 and signed on its behalf
by:
Andrew
Jacobs
Ray Davies
Chair
Finance Director
Consolidated Statement of Cash Flows
For the six months ended 31 January 2024
|
Notes
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Operating activities
|
|
|
|
|
Cash generated from
operations
|
24a
|
7,090
|
7,847
|
15,815
|
Income tax paid
|
|
(275)
|
(950)
|
(1,960)
|
Net cash from operating activities
|
|
6,815
|
6,897
|
13,855
|
Investing activities
|
|
|
|
|
Purchase of property, plant and
equipment
|
11
|
(17,263)
|
(7,589)
|
(15,803)
|
Interest received
|
|
282
|
305
|
665
|
Net cash (used in) investing activities
|
|
(16,981)
|
(7,284)
|
(15,138)
|
Financing activities
|
|
|
Proceeds of bank borrowings
utilised for store development and bank refinancing
|
|
8,369
|
(1,440)
|
(3,324)
|
Repayment of bank
borrowings
|
|
(19,043)
|
-
|
(12,386)
|
Finance costs paid
|
|
(1,158)
|
(1,440)
|
(3,324)
|
Lease liabilities paid
|
|
(1,086)
|
(871)
|
(1,817)
|
Primary equity placing (net of
placing costs)
|
|
-
|
-
|
19,611
|
Equity dividends paid
|
|
(4,267)
|
(3,602)
|
(5,295)
|
Proceeds from issuance of ordinary
shares (net)
|
|
175
|
97
|
161
|
Net cash (used in) financing activities
|
|
(16,991)
|
(5,816)
|
(3,050)
|
Net (decrease) in cash and cash equivalents in the
period
|
|
(27,157)
|
(6,203)
|
(4,333)
|
Cash and cash equivalents at beginning of the
period
|
|
42,132
|
46,465
|
46,465
|
Cash and cash equivalents at end of the
period
|
|
14,975
|
40,262
|
42,132
|
Accounting Policies
General information
Lok'nStore Group plc is an AIM
listed company incorporated and domiciled in England and Wales. As
required, further information is available in the investor section
of the company's website at http://www.loknstore.co.uk.
The address of the registered office is One Fleet Place, London,
EC4M 7WS, UK. Copies of this Interim Report and Accounts may be
obtained from the company's head office at 112 Hawley Lane,
Farnborough, Hants, GU14 8JE or from the investor section of the
company's website at
http://www.loknstore.co.uk.
The principal
activities of the Group and the nature of its operations are
described in the Business and Financial Review.
Basis of Accounting
The interim results for the six
months ended 31 January 2024 have been prepared on the basis of the
accounting policies expected to be used in the 2024 Lok'nStore
Group Plc Annual Report and Accounts and in accordance with the
recognition and measurement principles of UK adopted International
Accounting Standards.
The statutory accounts for the
year ended 31 July 2023 were delivered to the
Registrar of Companies following the company's Annual General
Meeting and will be available from the investor section of the
company's website at http://www.loknstore.co.uk.
The same accounting policies,
presentation and methods of computation are followed in these
interim condensed set of financial statements as have been applied
in the Group's latest annual audited financial statements and will
also be applied to the next annual audited financial
statements.
The interim results, which were
approved by the Directors on 19
April 2024, are unaudited. The
interim results do not constitute statutory financial statements
within the meaning of section 434A of the Companies Act 2006.
Comparative figures for the year ended 31 July 2023 have been
extracted from the statutory accounts for the Group for that
period, which carried an unqualified audit report, did not include
a reference to any matters to which the auditor drew attention by
way of emphasis of matter, did not contain a statement under
section 498(2) or (3) of the Companies Act 2006 and have been
delivered to the Registrar of Companies.
Basis of consolidation
The consolidated financial
statements incorporate the financial statements of the company and
entities controlled by the company (and its subsidiaries). Control
is achieved where the company has power over the investee, exposure
or rights to variable returns from the investee and the ability to
use its power to vary those returns. Intra-group transactions,
balances, and unrealised gains and losses on transactions between
Group companies are eliminated on consolidation, except to the
extent that intra-group losses indicate an impairment.
Going concern
The Directors can report that,
based on the Group's budgets and financial projections, which
include a recognition of the effect of rising costs, on the Group,
they have satisfied themselves that business is a going concern.
The impact of rising costs and increasing bank interest rates and
the measures the Directors have taken to mitigate its effects are
set out in the Business and Financial Review.
The Group has a Revolving
Credit Facility of £100 million which runs until April 2026.The
Board has a reasonable expectation that the company and the Group
have adequate resources and facilities to continue in operational
existence for the foreseeable future based on Group cash balances
and cash equivalents of £15.0
million (31.07.2023: £40.3 million), undrawn
committed bank facilities at 31 January 2024 of
£56.3 million
(31.07.2023: £33.2 million), and cash generated from operations in
the period of £7.09 million (31.01.2023: £7.85 million).
With interest rates rising,
interest risk per se is
increasing, however the Executive and the Board monitor this
position carefully through the Group's detailed operating reports
produced on a weekly basis and detailed financial and accounting
reports produced on a monthly basis. The Group's bank covenant
compliance is reviewed as part of this process. The Bank's senior
interest covenant is tested quarterly on a 12-month rolling
basis.
The Group is fully compliant with
all bank covenants and undertakings and is not obliged to make any
repayments prior to expiration. The robust
capital structure, cash flow and financing and the performance of
the business are reported in the Chair's Statement and in the
Business and Financial review. The interim financial statements are
therefore prepared on a going concern basis.
Revenue recognition
The Group recognises revenue when
the amount of the revenue can be reliably measured and when goods
are sold, and title has passed. Revenue from services provided is
recognised evenly over the period in which the services are
provided.
a) Self-storage
revenue
Self-storage services are provided
on a time basis. The price at which customers store their goods is
dependent on size of unit and store location. Customers are
invoiced on a four-weekly cycle in advance and revenue is
recognised based on time stored to date within the cycle. When
customers vacate, they are rebated the unexpired portion of their
four weekly advance payment (subject to a seven-day notice
requirement). Revenue is recognised evenly over the period of
self-storage.
b) Retail
sales
The Group operates a packaging
shop within each of its storage centres for selling storage-related
goods such as boxes, tape and bubble-wrap. Sales include sales to
the public at large as well as self-storage customers. Sales of
goods are recognised at point of sale when the product is sold to a
customer.
c) Insurance
Customers may choose to insure
their goods in storage. The weekly rate of insurance charged to
customers is calculated based on the tariff per week for each
£1,000 worth of goods stored by the customer. This charge is
retained by Lok'nStore and covers the cost of the block policy and
other costs. Customers are invoiced on a four-weekly basis
for the insurance cover they use, and revenue is recognised based
on time stored to date within the cycle.
The Group provides insurance to
customers through a block policy purchased from its insurer. Block
policyholders supply VAT exempt insurance transactions as
principals rather than insurance-related services as intermediaries
and accordingly insurance income received from the customer is
recognised as revenue rather than offset against the costs of the
block policy. The key characteristics of a block policy are
that:
· There
is a contract between the block policyholder and the insurer which
allows the block policyholder to effect insurance cover subject to
certain conditions.
· The
Group acting in our own name as the block policyholder procures
insurance cover for third parties from the insurer.
· There
is a contractual relationship between the block policyholder and
third parties under which the insurance is procured.
· The
block policyholder stands in place of the insurer in effecting the
supply of insurance to the third parties.
· The
Group is not exposed to any insured losses arising from its
insurance activity.
d) Management fee
income
Management fees earned for
managing stores not owned by the Group are recognised over the
period for which the services are provided. Fees are invoiced
monthly based on a percentage of revenue performance. Additional
performance fees may be earned if an individual managed stores'
EBITDA performance exceeds agreed thresholds. Periodic fees may
also be earned for additional specific services provided and are
invoiced when that service has been completed. Revenue is
recognised for each performance condition once the condition has
been met.
Critical Accounting Estimates a) and b) and Judgements c) and
d)
The preparation of financial
statements under IFRS requires management to make estimates and
assumptions that may affect the application of accounting policies
and the reported amounts of assets and liabilities, income and
expenses. Actual outcomes may differ from these estimates and
assumptions. The estimates and assumptions that have a significant
risk of causing a material adjustment to the carrying amounts of
assets and liabilities within the next financial year are discussed
below.
a) Estimate of fair value of trading
properties
The Group commissions an external
valuation of its self-storage stores at each financial year-end.
This valuation uses a discounted cash flow methodology which is
based on current and projected net operating income. Principal
assumptions underlying management's estimation of the fair value
are those relating to stabilised occupancy levels expected future
growth in storage fees and operating costs, maintenance
requirements, capitalisation rates and Discount Rates.
A more detailed explanation of the
background and methodology adopted in the valuation of the Group's
trading properties is set out in note 11. The carrying value of
land and buildings held at valuation at the reporting date was
£256.1 million (31.07.2023: £255.6 million) as shown in the table
in note 11.
b) Assets in the course of construction and land held for
store development ('Development property assets')
The Group's development property
assets are held in the statement of financial position at historic
cost and are not valued externally. In acquiring sites for
redevelopment into self-storage facilities, the Group estimates and
makes judgements on the potential lettable storage space that it
can achieve in its planning negotiations, together with the time it
will take to achieve maturity. In addition, assumptions are made on
the storage fees that can be achieved at the store by comparison
with other stores within the portfolio and within the local
area.
These judgements, taken together
with estimates of operating costs and the projected construction
cost, allow the Group to calculate the potential net operating
income at maturity, projected returns on capital invested and hence
to support the purchase price of the site at
acquisition.
Following the acquisition, regular
reviews are carried out taking into account the status of the
planning negotiations, and revised construction costs or capacity
of the new facility, for example, to make an assessment of the
recoverable amount of the development property. The Group reviews
all development property assets for impairment at each reporting
date in the light of the results of these reviews. Once a
store is opened it is valued as a trading store.
The carrying value of development
property assets at the reporting date was £45.2 million
(31.07.2023: £30.6 million). See note 11 for more
details.
c) Classification of
self-storage facilities as owner-occupied properties rather than
investment properties
The Directors consider that
Lok'nStore Group plc is the Parent Company of a 'trading business'
and is not wholly or mainly engaged in making
investments.
The Group is an integrated storage
solutions business offering a range of services to its customers.
We provide services to our customers under contracts for the
provision of storage services which do not give them any property
or tenancy rights and a large number of the stores we operate
are from properties where we do not own the land or the buildings.
The assets we do own are valued on the basis of the trading cash
flows that the operating businesses generate.
The Group continues to develop its
managed stores' business where it uses its operational and logistic
expertise to provide a full range of services to customers in
stores we manage for third-party owners. In recent years the Group
has developed many new managed stores all of which are owned by
third-party investors and managed by Lok'nStore.
Previously owned sites at Woking,
Ashford, Swindon and Crayford, have historically been the subject
of sale and manage-back transactions by which Lok'nStore has
retained the management of the business when a third-party owner
acquired the business, land and buildings. In FY2022, another four
trading stores were the subject of sale and manage-back
transactions by which Lok'nStore has retained the management of the
business.
All of this trading
activity, including active management and marketing activity, as
well as the self-storage income earned from our leasehold stores'
activity, demonstrate that the holding of land is not a core
activity because the trading operation is not dependent on the
ownership of land. See the chart in the Property Review for the
changing ownership structure of the stores.
The Group has always and continues
to comply with all of the usual accounting and tax protocols
consistent with a trading business. As at the period-end,
Lok'nStore operated 43 stores mainly in southern England, although
in recent years we have expanded our historically southern England
focused geographic footprint into the Southwest (Exeter), Wales
(Cardiff) and the Northwest (Salford, Warrington, and Altrincham).
Of the 43 stores, Lok'nStore owns the freehold interest in 17
stores, 10 of the stores are held under commercial leases. There
are a further 16 managed stores operating under management
contracts for third-party owners making a total of 43 stores
trading under the Lok'nStore brand. In addition, there is a secured
pipeline of a further 10 stores (8 owned and 2 managed). When fully
developed the Group will operate 53 trading stores. Since the
period-end this had risen to 44 stores with the opening of the
Kettering (Managed Store) in early February 2024.
One of the features of
Lok'nStore's strategy is to increase the number of stores we manage
for third parties selling our expertise in storage solutions
management, operating systems and marketing, through management
fees rather than retaining a proprietary interest in land and
buildings.
The classification of self-storage
facilities as owner-occupied properties rather than investment
properties has resulted in the recognition of fair value gains in
the period (net deferred of tax) of £1.35 million (31.07.2023: £5.9
million) in Other Comprehensive Income rather than the Income
Statement.
d) Application of IFRS 16
The Group uses judgement to assess
whether the interest rate implicit in the lease is readily
determinable. When the interest rate implicit in the
lease is not readily determinable, the Group makes a judgement on
the incremental borrowing rate based on its external borrowings
secured against a similar asset, adjusted for the term of the
lease.
e)
Dilapidations
The Group has a number of stores
operating under leasehold tenure. From time to time, in accordance
with the Group's stated objective to maximise shareholder value, it
may choose not to renew a lease, particularly where alternative
premises have been sourced and customers can be moved into the new
premises. In these circumstances the Group may incur repairing and
decoration liabilities ('dilapidations') based on the tenant's
obligation to the landlord to keep the leasehold premises in good
repair and decorative condition. Landlords in these circumstances
will normally serve a schedule of dilapidations on the tenant
setting out a list of items to be remedied. This may also refer to
obligations on the tenant to reinstate any alterations works
previously undertaken by the tenant under a Licence for
Alterations.
Such claims will always be
negotiated vigorously by Lok'nStore and may require legal,
valuation and surveyor's expertise, particularly if it can be shown
that the landlord's interest in the premises has not been
diminished by the dilapidations. As such, evaluations of actual
liabilities are always a critical judgement and any sums provided
to be set aside can only be an estimate until a settlement is
concluded.
Notes to the Financial Statements
For the six months ended 31 January 2024
1
Revenue
Analysis of the Group's revenue
from continuing operations is shown below:
|
Six months
ended
31 January
2024
Unaudited
|
Six
months
ended
31
January
2023
Unaudited
|
Year
ended
31
July
2023
Audited
|
Stores trading
|
£'000
|
£'000
|
£'000
|
Self-storage revenue
|
12,038
|
11,438
|
22,873
|
Insurance revenue
|
1,177
|
1,138
|
2,251
|
Retail sales
|
112
|
124
|
240
|
Sub-total - self-storage revenue -
owned stores
|
13,327
|
12,700
|
25,364
|
Management fees - managed
stores
|
780
|
822
|
1,659
|
Sub-total
|
14,107
|
13,522
|
27,023
|
Non-storage income
|
61
|
61
|
124
|
Total revenue per statement of comprehensive
income
|
14,168
|
13,583
|
27,147
|
2
Property, staff,
distribution, general costs and retail cost of
sales
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Property and premises
costs
|
3,682
|
3,034
|
6,821
|
Property lease rental
payments
|
(885)
|
(871)
|
(1,817)
|
Net property and premises
costs
|
2,797
|
2,163
|
5,004
|
Staff costs
|
2,744
|
2,577
|
5,267
|
General overheads
|
856
|
787
|
1,567
|
Subtotal - operating
costs
|
6,397
|
5,527
|
11,838
|
Retail products cost of
sales
|
124
|
125
|
253
|
Total property, staff, distribution, general costs and retail
cost of sales
|
6,521
|
5,652
|
12,091
|
3
Cost of sales of
retail products
Cost of sales represents the
direct costs associated with the sale of retail products such as
boxes and packaging and the ancillary sales of insurance cover for
customer goods, all of which fall within the Group's ordinary
activities.
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Retail
|
59
|
55
|
110
|
Insurance
|
41
|
48
|
97
|
Other
|
24
|
22
|
46
|
Total cost of sales of retail products
|
124
|
125
|
253
|
4
Non-underlying
items
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Project costs ¹
|
(20)
|
-
|
-
|
Liquidated damages received on
development 2
|
-
|
195
|
195
|
Abortive costs
3
|
-
|
(76)
|
(63)
|
Recognition of additional Share
Incentive Plan (SIP) liability
|
-
|
-
|
(369)
|
Additional follow-on costs
relating to the sale and manage-back of four trading stores located
at Basingstoke, Cardiff, Horsham and Portsmouth.
|
-
|
-
|
(81)
|
|
(20)
|
119
|
(318)
|
2024
1
Project costs
2023
2
Liquidated damages received on the late delivery
of a new store development which has subsequently
opened.
3
The Group's active search for suitable
development sites for new Landmark stores has resulted in some
abortive costs - mainly around planning and corporate professional
costs.
5
Finance
income
|
Six months ended
31 January
2024
Unaudited
£'000
|
Six
months ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Bank interest
|
279
|
305
|
660
|
Other interest
|
3
|
-
|
5
|
Total finance income
|
282
|
305
|
665
|
Interest receivable arises on cash
and cash equivalents (see note 16).
6
Finance
costs
|
Six months ended 31
January
2024
Unaudited
£'000
|
Six
months ended 31 January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Bank interest
|
-
|
676
|
1,568
|
Non-utilisation fees
|
190
|
100
|
212
|
Amortisation of bank loan
arrangement fees
|
116
|
117
|
235
|
Interest on lease
liabilities
|
300
|
115
|
547
|
Total finance cost
|
606
|
1,008
|
2,562
|
Most interest payable arises
on bank loans classified as financial liabilities measured at
amortised cost.
7
Profit before taxation
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended 31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£
'000
|
Profit before taxation is stated
after charging:
|
|
|
|
Depreciation and amounts written
off property, plant and equipment:
|
|
|
|
Depreciation based on historic
cost
|
1,316
|
1,225
|
2,550
|
Depreciation based on revalued
assets
|
769
|
576
|
1,455
|
Depreciation of
property, plant and equipment:
|
2,085
|
1,801
|
4,002
|
Depreciation of right of use
assets
|
658
|
662
|
1,688
|
|
2,743
|
2,463
|
5,690
|
8
Taxation
|
Six months ended 31
January
2024
Unaudited
£'000
|
Six
months
ended 31
January
2023
Unaudited
£'000
|
Year
ended 31
July
2023
Audited
£'000
|
Current tax:
|
|
|
|
UK corporation tax
|
559
|
671
|
1,245
|
Deferred tax:
|
|
|
|
Origination and reversal of
temporary differences
|
777
|
336
|
764
|
Total deferred tax
charge
|
777
|
336
|
764
|
Income tax expense for the
period/year
|
1,336
|
1,008
|
2,009
|
The charge for the period can be
reconciled to the profit for the period as follows:
|
Six months ended 31
January
2024
Unaudited
£'000
|
Six
months
ended 31
January
2023
Unaudited
£'000
|
Year
ended 31
July
2023
Audited
£'000
|
Profit before tax
|
4,273
|
4,659
|
6,701
|
Tax on ordinary activities at the
standard effective rate of corporation tax in the UK of
25%
|
1,068
|
866
|
1,423
|
Depreciation of non-qualifying
assets
|
257
|
225
|
482
|
Share based payment charges in
excess of corresponding tax deduction
|
72
|
(13)
|
94
|
Other non-deductible
expenditure
|
17
|
2
|
-
|
Adjustments in respect of prior
periods - corporation tax
|
(38)
|
-
|
(38)
|
Other
|
(40)
|
(72)
|
48
|
Income tax expense for the
period/year
|
1,336
|
1,008
|
2,009
|
Effective tax rate
|
31.3%
|
21.6%
|
30.0%
|
With the increase in corporation
tax rate to 25% effective 1 April 2023, the Group paid a blended
rate of 18.6% for year ended 31 July 2023.
9
Dividends
Amounts recognised as distributions to equity holders in the
year:
|
Six months ended 31 January
2024
Unaudited
£'000
|
Six
months ended 31 January 2023
Unaudited
£'000
|
Year
ended 31
July
2023
Audited
£'000
|
Final dividend - year ended 31
July 2022 (12.25 pence per share)
Interim dividend - six months to
31 July 2023 (5.00 pence per share)
Final dividend - year ended 31
July 2023 (13.25 pence per share)
|
-
4,267
|
3,602
-
|
3,602
1,693
|
|
4,267
|
3,602
|
5,295
|
Owing to the circumstances as
regards the recommended cash offer for the company by Shurgard Self
Storage Ltd as announced on 11 April 2024, the company will not be
paying an interim dividend.
10
Earnings per
share
The calculations of earnings per
share are based on the following profits and numbers of
shares.
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
|
|
|
|
Total profit for the financial
year attributable to owners of the parent
|
2,937
|
3,651
|
4,692
|
|
No. of
shares
|
No. of
shares
|
No. of
shares
|
Weighted average number of
shares
|
|
|
|
For basic earnings per
share
|
32,189,583
|
29,479,779
|
29,518,911
|
Dilutive effect of share
options
|
207,735
|
520,042
|
467,137
|
For diluted earnings per
share
|
32,397,318
|
29,999,821
|
29,986,048
|
623,212 shares (31.01.2023:
623,212) are held in the Employee Benefit Trust, and these are
excluded from the above calculation.
Earnings per share attributable to owners of the
Parent
|
Six months
ended
31 January
2024
Unaudited
|
Six
months
ended
31
January
2023
Unaudited
|
Year
ended
31
July
2023
Audited
|
Earnings per share - Basic
|
|
|
|
Basic earnings per
share
|
9.12p
|
12.38p
|
15.90p
|
Earnings per share - Diluted
|
|
|
|
Total diluted earnings per
share
|
9.06p
|
12.17p
|
15.65p
|
11
Property, plant and
equipment
The Group has an active store
development programme and has material qualifying assets that take
a substantial period of time to develop from acquisition to store
opening. Accordingly, in accordance with IAS 23, borrowing costs of
£1.27 million (six months ended 31.1.2023: £0.66 million: year
ended 31.07.2023 £1.5 million) have been capitalised in the current
period that are directly attributable to the acquisition,
construction and fit-out of these qualifying store
assets.
Capital expenditure during the
period totalled £18.5 million. This was primarily the contract exchange of
the Milton Keynes site, the purchase of the Eastbourne
site and the completion monies passing to the
developer for completing the Staines building prior to its fit-out.
site. There are ongoing construction and fit out works at our sites
in Staines and Basildon, final costs
on Bedford and Peterborough. Planning and
pre-development works at our Bournemouth, Altrincham, Barking and
Cheshunt sites also featured.
Property, plant and equipment
(non-current assets) with a carrying value of £332.1 million (31.7.2023: £314.0
million) (31.1.2023: £283.2 million) are pledged
as security for bank loans (see Note 17).
Market Valuation of Freehold and Operating Leasehold Land and
Buildings
It remains the Group's established
policy to undertake a comprehensive external valuation at each
year-end and we will do so at the next year-end at 31 July
2024.
Directors' valuation of land and property
Land & Buildings at the rear of the new Salford trading
store.
Following the opening of the
Salford store there is a remainder of land and building at the rear
of the new store which is suitable for rent on commercial terms to
third party users. Based on negotiated rents with third parties the
Directors continue to place a Directors' Valuation of £1.5 million
on this land and building. (31.7.2023: £1.5 million) (31.1.2023:
£1.5 million).
Group
|
Development
property
assets
at cost
£'000
|
Land and
buildings
at
valuation
£ '000
|
Short
leasehold
improvements
at cost
£'000
|
Fixtures,
fittings
and
equipment
at cost
£'000
|
Motor
vehicles
at cost
£'000
|
Total
£'000
|
Cost or valuation
|
|
|
|
|
|
|
1
August 2022
|
29,215
|
239,805
|
7,715
|
31,306
|
10
|
308,051
|
Additions
Transfers
|
7,178
|
50
|
32
|
991
|
|
8,251
|
Disposals
|
-
|
-
|
-
|
-
|
-
|
-
|
Revaluations
|
-
|
(17,016)
|
-
|
-
|
-
|
(17,016)
|
31 January 2023 Unaudited
|
36,393
|
222,839
|
7,747
|
32,297
|
10
|
299,286
|
Depreciation
|
|
|
|
|
|
|
1
August 2022
|
-
|
-
|
2,805
|
12,388
|
10
|
15,203
|
Depreciation
|
-
|
958
|
151
|
692
|
-
|
1,801
|
Revaluations
|
-
|
(958)
|
-
|
-
|
-
|
(958)
|
31 January 2023 Unaudited
|
-
|
-
|
2,956
|
13,080
|
10
|
16,046
|
Net book value at 31 January 2023 -
Unaudited
|
36,393
|
222,839
|
4,791
|
19,217
|
-
|
283,240
|
|
|
|
|
|
|
|
Cost or valuation
|
|
|
|
|
|
|
1
February 2023
|
36,393
|
222,839
|
7,747
|
32,297
|
10
|
299,286
|
Additions
|
6,082
|
(12)
|
141
|
2,886
|
-
|
9,097
|
Transfers
|
(11,870)
|
10,186
|
-
|
1,684
|
-
|
-
|
Disposals
|
-
|
-
|
-
|
-
|
-
|
-
|
Revaluations
|
-
|
22,586
|
-
|
-
|
-
|
22,586
|
31 July 2023 - Audited
|
30,605
|
255,599
|
7,888
|
36,867
|
10
|
330,969
|
Depreciation
|
|
|
|
|
|
|
1
February 2023
|
-
|
-
|
2,956
|
13,080
|
10
|
16,046
|
Depreciation
|
-
|
1,291
|
150
|
760
|
-
|
2,201
|
Revaluations
|
-
|
(1,291)
|
-
|
-
|
-
|
(1,291)
|
31 July 2023 - Audited
|
-
|
-
|
3,106
|
13,840
|
10
|
16,956
|
Net book value at 31 July 2023 - Audited
|
30,605
|
255,599
|
4,782
|
23,027
|
-
|
314,013
|
Cost or valuation
1
August 2023
|
30,605
|
255,599
|
7,888
|
36,867
|
10
|
330,969
|
Additions
|
18,122
|
167
|
128
|
114
|
-
|
18,531
|
Transfers
|
(3,510)
|
-
|
-
|
3,510
|
-
|
-
|
Revaluations
|
-
|
375
|
-
|
-
|
-
|
375
|
31 January 2024 - Unaudited
|
45,217
|
256,141
|
8,016
|
40,491
|
10
|
349,875
|
Depreciation
|
|
|
|
|
|
|
1
August 2023
|
-
|
-
|
3,106
|
13,840
|
10
|
16,956
|
Depreciation
|
-
|
1,233
|
139
|
713
|
-
|
2,085
|
Revaluations
|
-
|
(1,233)
|
-
|
-
|
-
|
(1,233)
|
31 January 2024 Unaudited
|
-
|
-
|
3,245
|
14,553
|
10
|
17,808
|
Net book value at 31 January 2024 -
Unaudited
|
45,217
|
256,141
|
4,771
|
25,938
|
-
|
332,067
|
12
Right of Use assets
(ROU)
The Group accounts for the value
of its property leases on the balance sheet by the recognition of a
right of use asset (the right to use the leased item) and a
corresponding financial liability to pay rentals due over the
property lease term. This treatment relates to the Group's property
leases. The Group has no leases on any other types of
assets.
The Group recognises
right of use assets (ROU) of £13.1 million at 31
January 2024 (£13.8 million at 31 July 2023 and total lease
liabilities of £14.7 million, (31.07.2023: £14.7 million) with
depreciation charges of £0.7 million (31.07.2023: £1.7 million) and
lease interest charges of £0.3 million (31.07.2023: £0.5
million).
Detailed analysis is provided in
the tables below: -
Right of use asset (ROU)
|
Group
31 January
2024
£'000
|
Group
31
January
2023
£'000
|
Group
31 July
2023
£'000
|
At 31 July 2022
|
13,768
|
10,424
|
10,424
|
Additions
|
-
|
(50)
|
5,032
|
Depreciation
|
(658)
|
(662)
|
(1,688)
|
At 31 July 2024
|
13,110
|
9,712
|
13,768
|
The Group accounts for the value
of its property leases on the balance sheet by the recognition of a
right of use asset (the right to use the leased item) and a
corresponding financial liability to pay rentals due over the
property lease term. This treatment relates to the Group's property
leases. The Group has no leases on any other types of
assets.
|
Group
31 January
2024
£'000
|
Group
31
January
2023
£'000
|
Group
31
July
2023
£'000
|
|
|
|
|
Property rentals
|
885
|
871
|
1,817
|
Depreciation of right of use
assets (ROU)
|
(658)
|
(662)
|
(1,688)
|
Interest charged on lease
liability
|
(299)
|
(115)
|
(547)
|
Impact on Comprehensive
Income
|
72
|
94
|
(418)
|
The Present Value of all future
operating lease payments on existing leases is calculated using
2.2% (2023: 2.2%) and on the two new leases executed in 2023 at
6.43% as an incremental borrowing rate as the single Discount
Rate. The right of use assets are depreciated based on the
individual lease term of the separate leases.
13
Inventories
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Consumables and goods for
resale
|
131
|
132
|
145
|
The amount of inventories
recognised as an expense during the period was £59,320
(31.1.2023: £54,851).
14 Trade and other
receivables
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Trade receivables
|
1,293
|
1,960
|
1,342
|
Other receivables
|
1,690
|
1,252
|
779
|
Taxation
|
-
|
-
|
27
|
Prepayments and accrued
income
|
534
|
526
|
437
|
|
3,517
|
3,738
|
2,585
|
Other receivables includes a VAT
repayment receivable of £623,129. This was received from HMRC on 12
March 2024.
Trade receivables
In respect of its self-storage
business the Group does not typically offer credit terms to its
customers and hence the Group is not exposed to significant credit
risk. All customers are required to pay in advance of the storage
period. Late charges are applied to a customer's account if they
are more than ten days overdue in their payment. The Group provides
for receivables based upon sales levels and estimated
recoverability.
There is a right of lien over the
customers' goods, so if they have not paid within a certain time
frame the Group has the right to sell the items, they store to
cover the debt owed by the customer. Trade receivables that are
overdue are provided for based on estimated irrecoverable amounts,
determined by reference to expected credit
losses.
For individual self-storage
customers, the Group does not perform credit checks. However, this
is mitigated by the fact that all customers are required to pay in
advance. Before accepting a new business customer who wishes to use
a number of the Group's stores, the Group uses an external credit
rating to assess the potential customer's credit quality and
defines credit limits by customer. There are no customers who
represent more than 5% of the total balance of trade
receivables.
There has not been a significant
change in credit quality in the Group's trade receivables and the
amounts are still considered recoverable. The Group holds a right
of lien over its self-storage customers' goods if these debts are
not paid.
15 Trade and other
payables
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Trade payables
|
2,858
|
2,310
|
1,326
|
Taxation and social security
costs
|
467
|
401
|
453
|
Other payables
|
536
|
561
|
549
|
Accruals and deferred
income
|
3,589
|
3,621
|
4,852
|
|
7,450
|
6,893
|
7,180
|
The Directors consider that the
carrying amount of trade and other payables and accruals
approximates fair value.
16 Capital
management and gearing
The Group manages its capital to
ensure that entities in the Group will be able to continue as going
concerns while maximising the return to stakeholders through the
optimisation of the debt and equity balance.
The capital structure of the Group
consists of debt, which includes the borrowings disclosed in note
17, cash and cash equivalents and equity attributable to the owners
of the Parent, comprising issued capital, reserves and retained
earnings as disclosed in the Consolidated Statement of Changes in
Equity.
The Group's banking facilities
require that management give regular consideration to interest rate
hedging strategy. The Group has complied with this requirement
during the year.
The Group's Board reviews the
capital structure on an on-going basis. As part of this review, the
Board considers the cost of capital and the risks associated with
each class of capital.
The Group seeks to have a
relatively conservative gearing ratio (the proportion of net debt
to equity) balancing the overall level with the opportunities for
the growth of the business. The Board considers at each review the
appropriateness of the current ratio in light of the above. The
Board is currently satisfied with the Group's gearing
ratio.
The gearing ratio at the
period-end is as follows:
Gearing - Bank Borrowings
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Gross debt
|
(43,744)
|
(66,785)
|
(54,399)
|
Cash and cash
equivalents
|
14,975
|
40,262
|
42,132
|
Net debt
|
(28,769)
|
(26,523)
|
(12,267)
|
Total equity - balance
sheet
|
230,886
|
193,674
|
230,472
|
Net debt to equity
ratio
|
12.5%
|
13.7%
|
5.3%
|
Total Gearing - Bank Borrowings and lease
liabilities
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Gross debt - bank
borrowings
|
(43,744)
|
(66,785)
|
(54,399)
|
Gross debt - lease
liabilities
|
(14,307)
|
(10,087)
|
(14,656)
|
Cash and cash
equivalents
|
14,975
|
40,262
|
42,132
|
Net debt
|
(43,076)
|
(36,610)
|
(26,923)
|
Total equity - balance
sheet
|
230,886
|
193,674
|
230,472
|
Net debt to equity
ratio
|
18.7%
|
18.9%
|
11.7%
|
Cash balances held in current
accounts attract no interest, but surplus cash is transferred daily
to a treasury deposit account which earns interest at the
prevailing money market rates. All amounts are denominated in
Sterling. The balances at 31 January 2024 are as
follows:
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Variable rate treasury
deposits
|
14,539
|
39,490
|
41,238
|
SIP trustee deposits
|
63
|
63
|
63
|
Cash in operating current
accounts
|
368
|
703
|
826
|
Other cash and cash
equivalents
|
5
|
6
|
5
|
Total cash and cash
equivalents
|
14,975
|
40,262
|
42,132
|
The Group reviews the current and
forecast projections of cash flow, borrowing and interest cover as
part of its monthly management accounts review. In addition, an
analysis of the impact of significant transactions is carried out
regularly, as well as a sensitivity analysis of the impact of
movements in interest rates on gearing and interest
cover.
The Group places its cash deposits
not immediately required for store development activity cash on
Treasury Deposit Reserve in tranches based on fixed monthly deposit
periods and executes these on a rolling basis.
17a
Borrowings
The Group currently has £43.7
million drawn against its facility which
is secured with RBS and ABN AMRO jointly by legal charges and
debentures over the freehold and leasehold properties and other
tangible assets of the business with a net book value of £332.1
million (31.1.2023: £283.2 million)
together with cross-company guarantees from Group
companies.
The interest rate is set under
Sterling Overnight Index Average (SONIA) arrangements.
The all-in debt cost on
the floating rate of £33.7 million drawn averaged
6.72% (31.7.2023: 4.77%) in
the period. The £10 million of fixed debt (see note 17b) reduced
the total average all-in rate to 6.63%.
The Group is not obliged to make
any repayments prior to the facility's expiration in April
2026.
Bank borrowings
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Non-current
|
|
|
|
Bank loans repayable in more than
two years
|
|
|
|
but not more than five
years
|
|
|
|
Gross
|
43,744
|
66,785
|
54,399
|
Deferred financing
costs
|
(236)
|
(471)
|
(353)
|
Net bank borrowings
|
43,508
|
66,314
|
54,046
|
Non-current borrowings
|
43,508
|
66,314
|
54,046
|
17b Derivative financial
instruments
In December 2023, the Group
entered into a £5.0 million interest rate swap with ABN Amro Bank
effective from 21 December 2023 at a fixed 5-year SONIA swap rate
of 3.51%. Also, in December 2023 the Group entered into a £5
million interest rate swap with Nat West Bank plc effective from 22
December 2023 at a fixed 5-year SONIA swap rate of 3.51%. This £10
million of aggregate swap instruments fixes the interest rate on
£10.0 million of debt at an effective rate
of 5.21% based on current 150 basis points (bps) margin and
will result in estimated saving of c. £0.2
million of interest payable in the coming year compared to the
company's current cost of floating debt of 6.7% on its Revolving
Credit Facility.
The £10 million fixed rate is
treated as an effective cash flow hedge and its fair value stated
as a non-current asset of £54,664 as set out in the table
below.
|
Currency
|
Principal
£
|
Maturity
date
|
Fair value
£
|
Interest rate swap
(NatWest)
|
GBP
|
5,000,000
|
22/12/28
|
20,960
|
Interest rate swap (ABN
Amro)
|
GBP
|
5,000,000
|
21/12/28
|
33,704
|
|
|
10,000,000
|
|
54,664
|
The fair value of the interest
rate swaps of £54,664 has been recognised in other comprehensive
income in the year.
18 Lease
liabilities
The lease liability is initially
measured at the present value of the lease payments that are not
paid at the commencement date, discounted by using the rate
implicit in the leases. Where this cannot be readily determined the
Present Value of all future operating lease payments is calculated
using 2.2% (2023: 2.2%) as an incremental
borrowing rate as the Discount Rate.
After the application of an
interest charge at 2.2% (2023: 2.2%) but 6.4% based on the effect
of the two leases executed, the total lease liabilities are shown
below.
Lease liabilities attributable to Right of Use
assets
|
31
January
2024
Unaudited
£'000
|
31 January
2023
Unaudited
£'000
|
31 July
2023
Audited
£'000
|
|
|
|
|
Current lease liabilities
|
|
|
|
Amounts due within one
year
|
992
|
1,295
|
826
|
Non-current lease liabilities
|
|
|
|
Amounts due in one to two
years
|
1,001
|
1,075
|
1,039
|
Amounts due in three to five
years
|
1,753
|
2,642
|
1,786
|
Amounts due in more than five
years
|
10,561
|
5,075
|
11,005
|
Non-current lease liabilities
|
13,315
|
8,792
|
13,830
|
Total lease liabilities
|
14,307
|
10,087
|
14,656
|
Lease liabilities attributable to Right of Use
assets
|
31
January
2024
Unaudited
£'000
|
31 January
2023
Unaudited
£'000
|
31 July
2023
Audited
£'000
|
Total lease liabilities
B/fwd
|
14,656
|
10,894
|
10,894
|
Increase in lease liabilities -
lease extensions
|
-
|
(51)
|
5,032
|
Lease repayments
|
(649)
|
(871)
|
(1,817)
|
Lease interest
(non-cash)
|
300
|
115
|
547
|
Total lease liabilities
C/fwd
|
14,307
|
10,087
|
14,656
|
The portfolio of property leases
all have similar characteristics. Subject to periodic future rent
reviews, typically every five years, there are no variable lease
payments. The Group has no leases on any other types of
assets.
The total future commitments due
under non-cancellable leases is set out in note 25 (Commitments
under Property Leases).
19 Deferred
tax
Deferred tax liability
|
31 January
2024
Unaudited
£'000
|
31
January 2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Liability at start of period/year
|
66,290
|
63,214
|
63,214
|
Charge to income for the
period/year
|
777
|
336
|
764
|
Tax charged / credited directly to
other comprehensive income
|
272
|
(4,014)
|
1,954
|
Credit to share based payment
reserve
|
108
|
-
|
358
|
Liability at end of period/year
|
67,447
|
59,536
|
66,290
|
20
Share
capital
|
31 January
2024
Unaudited
£'000
|
31
January 2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Authorised: 35,000,000 ordinary
shares of 1 pence each
|
350
|
350
|
350
|
|
Called up,
|
Called
up,
|
Called
up,
|
|
allotted
and
|
allotted
and
|
allotted
and
|
|
fully paid
|
fully
paid
|
fully
paid
|
|
Number
|
Number
|
Number
|
Number of shares at start of
period/year
|
32,767,458
|
30,003,545
|
30,003,545
|
Options exercised during
period/year
|
127,685
|
42,657
|
84,174
|
Primary placing of fully paid
ordinary shares - 7 July 2023
|
-
|
-
|
2,679,739
|
Balance at end of
period/year
|
32,895,143
|
30,046,202
|
32,767,458
|
Allotted, issued and fully paid
ordinary shares
|
£
|
£
|
£
|
Balance at start of
period/year
|
329
|
301
|
301
|
Options exercised during
period/year
|
1
|
-
|
1
|
Primary placing of fully paid
ordinary shares
|
|
-
|
27
|
Balance at end of
period/year
|
330
|
301
|
329
|
The company has one class of
ordinary shares which carry no right to fixed income.
21 Other
reserves
|
|
Other
|
Capital
|
Share-based
|
|
|
|
Merger
|
reserve
|
redemption
|
payment
|
Hedging
|
|
|
reserve
|
|
reserve
|
reserve
|
reserve
|
Total
|
Group
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
1
August 2022 - Audited
|
6,295
|
1,294
|
34
|
1,479
|
-
|
9,102
|
Equity share based
payments
|
-
|
-
|
-
|
225
|
-
|
225
|
Tax credit relating to share
options
|
-
|
-
|
-
|
(24)
|
-
|
(24)
|
31 January 2023 - Unaudited
|
6,295
|
1,294
|
34
|
1,680
|
-
|
9,303
|
Equity share based
payments
|
-
|
-
|
-
|
225
|
-
|
225
|
Transfer to retained earnings in
relation to share based payments
|
-
|
-
|
-
|
(47)
|
-
|
(47)
|
Tax relating to share
options
|
-
|
-
|
-
|
(334)
|
-
|
(334)
|
31 July 2023 - Audited
|
6,295
|
1,294
|
34
|
1,524
|
-
|
9,147
|
Equity share based
payments
|
-
|
-
|
-
|
286
|
-
|
286
|
Cash flow hedge reserve net of
tax
|
-
|
-
|
-
|
-
|
41
|
41
|
Transfer to retained earnings in
relation to share based payments
|
-
|
-
|
-
|
(129)
|
-
|
(129)
|
Tax credit relating to share
options
|
-
|
-
|
-
|
(108)
|
-
|
(108)
|
31 January 2024 - Unaudited
|
6,295
|
1,294
|
34
|
1,573
|
41
|
9,237
|
Merger reserve
The merger reserve represents the
excess of the nominal value of the shares issued by Lok'nStore
Group plc over the nominal value of the share capital and share
premium of Lok'nStore Limited as at 31 July 2001.
Other reserves
The other distributable reserve
and the capital redemption reserve arose in the year ended 31 July
2004 from the purchase of the company's own shares and a
cancellation of share premium.
Share based payment reserve
Under IFRS 2 there is the option
to make transfers from the share-based payment reserve to retained
earnings in respect of accumulated share option charges where the
options have either been exercised or have lapsed
post-vesting.
22 Retained
earnings
|
Retained earnings before
deduction of own shares
|
Own shares
|
Retained earnings
|
|
|
(Note 23)
|
Total
|
Group
|
£'000
|
£'000
|
£'000
|
1
August 2023 - Audited
|
|
|
|
Profit for the financial
period
|
3,651
|
-
|
3,651
|
Transfer from revaluation reserve
- additional depreciation on revaluation
|
432
|
-
|
432
|
Transfer share-based payment
reserve (Note 21)
|
24
|
-
|
24
|
Dividend paid
|
(3,602)
|
-
|
(3,602)
|
31 January 2023 - Unaudited
|
56,013
|
(500)
|
55,513
|
1
February 2023 - Unaudited
Profit for the financial
period
|
1,041
|
-
|
1,041
|
Transfer from revaluation reserve
- additional depreciation on revaluation
|
663
|
-
|
663
|
Transfer share-based payment
reserve (Note 21)
|
23
|
-
|
23
|
Dividend paid
|
(1,693)
|
-
|
(1,693)
|
31 July 2023 - Audited
|
56,047
|
(500)
|
55,547
|
1
August 2023 - Audited
|
|
|
|
Profit for the financial
period
|
2,937
|
-
|
2,937
|
Transfer from revaluation reserve
- additional depreciation on revaluation
|
577
|
-
|
577
|
Transfer share-based payment
reserve (Note 21)
|
129
|
-
|
129
|
Dividend paid
|
(4,267)
|
-
|
(4,267)
|
31
January 2024 - Unaudited
|
55,423
|
(500)
|
54,923
|
The transfer from revaluation
reserve represents the additional depreciation charged on revalued
assets net of deferred tax. The Own Shares Reserve represents the
cost of shares in Lok'nStore Group plc purchased in the market and
held in the Employee Benefit Trust to satisfy awards made under the
Group's share incentive plan.
23 Own
shares
|
EBT
|
EBT
|
Treasury
|
Treasury
|
Own shares
|
|
shares
|
shares
|
|
|
Total
|
|
Number
|
£
|
Number
|
£
|
£
|
31 July 2022 - Audited
|
623,212
|
499,910
|
|
-
|
499,910
|
31 January 2023 -
Unaudited
|
623,212
|
499,910
|
-
|
-
|
499,910
|
31 July 2023 - Audited
|
623,212
|
499,910
|
-
|
-
|
499,910
|
31
January 2024 - Unaudited
|
623,212
|
499,910
|
-
|
-
|
499,910
|
The Group operates an Employee
Benefit Trust (EBT) under a settlement dated 8 July 1999 between
Lok'nStore Limited and Lok'nStore Trustee Limited, constituting an
employees' share scheme.
Funds are placed in the trust by
way of deduction from employees' salaries on a monthly basis as
they so instruct for purchase of shares in the company. Shares are
allocated to employees at the prevailing market price when the
salary deductions are made.
As at 31 January 2024, the Trust
held 623,212 (31.01.2023: 623,212) ordinary shares of 1 pence each
with a market value of £5,048,017
(31.01.2023: £5,920,514). No shares were
transferred out of the scheme during the period (2023: Nil). No
options have been granted under the EBT.
24 Cash
flows
(a) Reconciliation of profit before tax to cash
generated from operations
|
|
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Group profit before tax
|
|
|
4,273
|
4,659
|
6,701
|
Depreciation and loss on
disposal
|
|
|
2,743
|
2,463
|
5,690
|
Equity settled share-based
payments
|
|
|
287
|
225
|
405
|
Non-underlying items
|
|
|
20
|
(119)
|
318
|
Interest receivable
|
|
|
(282)
|
(305)
|
(665)
|
Interest payable - bank
borrowings
|
|
|
307
|
894
|
2,015
|
Interest payable - lease
liabilities
|
|
|
299
|
115
|
547
|
Decrease / (increase) in
inventories
|
|
|
14
|
11
|
(2)
|
(Increase) / decrease in
receivables
|
|
|
(959)
|
250
|
1,393
|
Increase /(decrease) increase in
payables
|
|
|
388
|
(346)
|
(632)
|
Cash generated from operations
|
|
|
7,090
|
7,847
|
15,815
|
(b) Reconciliation of net cash flow to movement in net
debt
Net debt is defined as non-current
and current borrowings, as detailed in note 17 less cash and cash
equivalents.
|
|
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
(Decrease) / increase in cash in
the period/year
|
|
|
(27,157)
|
(6,203)
|
(4,333)
|
Change in net debt resulting from
cash flows
|
|
|
10,655
|
-
|
12,386
|
Movement in net debt in
period
|
|
|
(16,502)
|
(6,203)
|
8,053
|
Net debt brought
forward
|
|
|
(12,267)
|
(20,320)
|
(20,320)
|
Net debt carried
forward
|
|
|
(28,769)
|
(26,523)
|
(12,267)
|
25 Commitments
under property leases
At 31 January 2024 the total
future minimum lease payments as a lessee under non-cancellable
property leases were as follows:
Land and buildings
|
|
31 January
2024
Unaudited
£'000
|
31
January
2023
Unaudited
£'000
|
31
July
2023
Audited
£'000
|
Amounts due:
|
|
|
|
|
Within one year
|
|
1,560
|
1,727
|
1,415
|
Between two and five
years
|
|
4,228
|
4,663
|
4,354
|
After five years
|
|
14,020
|
5,693
|
14,687
|
|
|
19,808
|
12,083
|
20,456
|
Property lease payments represent
rentals payable by the Group for certain of its properties.
Typically, leases are negotiated for a term of 20 years and rentals
are fixed for an average of five years.
26 Related party
events
The aggregate remuneration of the
Directors, and the other key management personnel of the Group, is
set out below.
|
Six months
ended
31 January
2024
Unaudited
£'000
|
Six
months
ended
31
January
2023
Unaudited
£'000
|
Year
ended
31
July
2023
Audited
£'000
|
Short-term employee benefits -
Directors
|
421
|
374
|
827
|
Short-term employee benefits -
Other key management
|
65
|
105
|
175
|
Post-employment benefits -
Directors
|
11
|
9
|
13
|
Post-employment benefits - Other
key management
|
3
|
4
|
6
|
Share-based payments
|
287
|
225
|
450
|
Social security costs -
Directors
|
144
|
80
|
158
|
Social security costs - Other key
management
|
23
|
23
|
43
|
Total
|
954
|
820
|
1,672
|
The Group recognises a number of
management personnel that are important to retain within the
business in order for it to achieve its strategic plan.
Accordingly, these are recognised as key personnel and are
participants in the Long-Term Performance Plan. They are included
in the table above.
27
Capital Commitments
The Group has capital expenditure
contracted but not provided for in the financial statements of
£4.27 million relating to commitments to complete the ongoing
construction of our sites in Staines, a phase 2 fit-out at Bedford,
and retentions held on Warrington, Stevenage, Bedford and
Peterborough.
28 Events after the
Reporting Date
·
Eastbourne
planning
A new formal planning permission for
a new store in Eastbourne, Sussex was approved on 18 March
2024.
·
Recommended
Cash Offer of Lok'nStore Group Plc by
Shurgard Self Storage Ltd ("Shurgard")
("The
Offer")
On 11 April 2024, the Boards of
Shurgard and Lok'nStore announced that they have reached agreement
on the terms of a recommended cash offer to be made by Shurgard to
acquire the entire issued and to be issued share capital of
Lok'nStore (the 'Acquisition').
Under the terms of the
Offer, Lok'nStore
Shareholders will be entitled to receive 1,110 pence in cash for
each Lok'nStore Share. The Directors intend to unanimously
recommend the
Offer.
The Offer is expected to be effected by
means of a Court-sanctioned Scheme
of Arrangement
between Lok'nStore and Scheme Shareholders under
Part 26 of the Companies Act 2006, although Shurgard reserves the
right to effect the Acquisition by way of a Takeover
Offer.
The Offer
contains a customary price adjustment in respect of any dividends
declared, made or paid after 11 April 2024 and hence the Board are
not recommending a dividend at this interim stage.
Glossary
Abbreviation
APM
|
Alternative performance
measure
|
Adjusted EBITDA
|
Earnings before all depreciation
and amortisation charges, losses or profits on disposal,
share-based payments, acquisition costs, non-underlying items and
non-recurring professional costs, finance income, finance costs and
taxation
|
Adjusted Store EBITDA
|
Adjusted EBITDA (see above) but
before central and head office costs
|
AGM
|
Annual General Meeting
|
Bps
|
Basis Points
|
CAD
|
Cash available for
Distribution
|
Capex
|
Capital Expenditure
|
CGU
|
Cash-generating units
|
CO2 e
|
Carbon Dioxide
Equivalents
|
CSOP
|
Company Share Option
Plan
|
DRIP
|
Dividend Reinvestment
Plan
|
EBT
|
Employee Benefit Trust
|
EIS
|
Enterprise Investment
Scheme
|
(eKPIs)
|
Environmental key performance
indicators
|
EMI
|
Enterprise Management Incentive
Scheme
|
ESOP
|
Employee Share Option
Plan
|
EU
|
European Union
|
GHG
|
Greenhouse gas
|
HMRC
|
His Majesty's Revenue and
Customs
|
IAS
|
International Accounting
Standard
|
IFRIC
|
International Financial Reporting
Interpretations Committee
|
IFRS
|
International Financial Reporting
Standards
|
ISA
|
International Standards on
Auditing
|
JLL
|
Jones Lang LaSalle
|
KPI
|
Key Performance
Indicator
|
LFL
|
Like for like
|
LTPPP
|
Long Term Partnership Performance
Plan
|
LTV
|
Loan to Value Ratio
|
MWh
|
Megawatt Hour
|
NAV
|
Net Asset Value
|
NBV
|
Net Book Value
|
Operating Profit
|
Earnings before interest and tax
(EBIT)
|
PPP
|
Partnership Performance
Plan
|
PV
|
Photovoltaic
|
QCA
|
Quoted Companies
Alliance
|
RICS
|
Royal Institution of Chartered
Surveyors
|
RNS
|
Regulatory News Service
|
ROU
|
Right of Use Asset
|
SIP
|
Share Incentive Plan
|
SME
|
Small and medium sized
enterprises
|
SONIA
|
Sterling Overnight Index
Average
|
Sq. ft.
|
Square feet
|
tCO2e
|
Tonnes of carbon dioxide
equivalent
|
TVR
|
Total voting rights
|
VAT
|
Value Added Tax
|