Big Yellow Group PLC · LSE:BYG
Big Yellow — FY2023 Earnings Presentation
52 slides from Big Yellow's earnings presentation, May 2023
Slide 1: Financial results for the year ended 31 March 2023
Big Yellow Group PLC Financial results for the year ended 31 March 2023
Slide 2: Our Investment Case
Our Investment Case BIG YELLOW GROUP FULL YEAR RESULTS • UK self storage penetration in key urban conurbations remains relatively low • Limited new supply coming onto the market ATTRACTIVE MARKET DYNAMICS • Resilient through the last economic downturn and performed well during the pandemic • Self st
Slide 3: Key Financial Metrics
Key Financial Metrics BIG YELLOW GROUP FULL YEAR RESULTS CATEGORY 2023 2022 CHANGE Revenue £188.8 million £171.3 million 10% Like-For-Like Store Revenue £162.9 million £151.8 million 7% OVERVIEW Cash Flow From Operating Activities (After Net Finance Costs And Pre-Working Capital Movements) £109.2 mi
Slide 4: Key Operational Metrics
Key Operational Metrics BIG YELLOW GROUP FULL YEAR RESULTS CATEGORY 2023 2022 CHANGE Number of stores 108 105 Store Maximum Lettable Area 6,292,000 6,098,000 3% OVERVIEW Closing Occupancy (Sq Ft) 5,088,000 5,107,000 (0.4%) Occupancy Like-For-Like Stores 84.0% 86.0% (2.0 ppts) Closing Net Rent Per Sq
Slide 5: Highlights
Highlights BIG YELLOW GROUP FULL YEAR RESULTS • Revenue growth of 10%, reflecting new stores and an additional three months of Armadillo (acquired 1 July 2021) • Like-for-like store revenue is up 7%, mainly from increases in average achieved rents • Like-for-like occupancy decrease of 2.0 ppts to 84
Slide 6: Highlights - Investment In New Capacity
BIG YELLOW GROUP Highlights - Investment In New Capacity FULL YEAR RESULTS • 193,000 sq ft of capacity added in the year, with two new stores opened in London (Harrow and Kingston North), and an operating store acquired in Aberdeen • Acquisition of freehold property on Old Kent Road, London taking t
Slide 7: Operations Update
Operations Update BIG YELLOW GROUP FULL YEAR RESULTS • Eight new stores opened (524,000 sq ft) since 2020, all cash flow positive – expected to deliver a proforma 8% - 9% year three NOI yield • Continued investment in automation in the stores, leading to improved efficiencies and productivity – bene
Slide 8: Monthly Activity
Monthly Activity BIG YELLOW GROUP FULL YEAR RESULTS Monthly Move-ins Monthly Move-outs 14,000 14,000 12,000 12,000 10,000 10,000 8,000 2021 8,000 2021 6,000 2022 6,000 2022 4,000 2023 4,000 2023 2,000 2,000 OVERVIEW • Covid impacted 2020 and seasonal activity levels have largely normalised Monthly C
Slide 9: Financial Review
FINANCIAL REVIEW Harrow, London, September 2022
Slide 10: Portfolio Summary
Portfolio Summary BIG YELLOW GROUP FULL YEAR RESULTS • Portfolio summary showing Big Yellow and Armadillo stores in both periods • Like-for-like closing occupancy down 2.0 ppts to 84.0% FINANCIAL REVIEW • Closing net rent up 9% to £32.48, like-for-like average rate up 10% • Like-for-like store reven
Slide 11: Portfolio Summary
Portfolio Summary BIG YELLOW GROUP FULL YEAR RESULTS MARCH 2023 MARCH 2022 BIG YELLOW BIG YELLOW BIG YELLOW BIG YELLOW TOTAL TOTAL ESTABLISHED DEVELOPING ARMADILLO TOTAL ESTABLISHED DEVELOPING ARMADILLO TOTAL BIG YELLOW BIG YELLOW > 3 YEARS < 3 YEARS > 3 YEARS < 3 YEARS Number of stores 75 9 84 24 1
Slide 12: Rental Growth Analysis
Rental Growth Analysis BIG YELLOW GROUP FULL YEAR RESULTS NET RENT PER SQ FT GROWTH NET RENT PER SQ FT GROWTH AVERAGE OCCUPANCY NUMBER OF STORES FROM FROM IN THE YEAR APRIL 2022 TO MARCH 2023 APRIL 2021 TO MARCH 2022 70% to 85% 47 8.3% 10.8% FINANCIAL REVIEW 85% to 90% 47 8.7% 11.7% Above 90% 7 9.7%
Slide 13: Store Operating Expenses
Store Operating Expenses BIG YELLOW GROUP FULL YEAR RESULTS YEAR YEAR % OF STORE CATEGORY ENDED ENDED CHANGE OPERATING • Shows Big Yellow and Armadillo combined 31.03.23 31.03.22 COSTS IN £000 £000 YEAR • New stores account for an extra £2.1 million of operating expense Cost of sales 2,202 3,896 (43
Slide 14: Consolidated Income Statement
Consolidated Income Statement BIG YELLOW GROUP FULL YEAR RESULTS YEAR ENDED YEAR ENDED 31.03.23 31.03.22 £000 £000 Revenue 188.8 171.3 • Revenue up 10%, like-for-like store revenue up 7% Cost of Sales (54.3) (50.4) • Admin expenses increase of £0.2 million, prior year includes non- FINANCIAL Admin E
Slide 15: Adjusted PBT Bridge
Adjusted PBT Bridge BIG YELLOW GROUP FULL YEAR RESULTS Increase in Increase in Increase in Increase in Increase in Reduction gross administrative other net capitalised in share of profit expenses operating interest interest adjusted income payable profit of associates FINANCIAL £13.6m (£0.6m) £2.2m
Slide 16: Cash Flow And Net Debt Movement
Cash Flow And Net Debt Movement BIG YELLOW GROUP FULL YEAR RESULTS YEAR ENDED YEAR ENDED 31.03.23 31.03.22 £m £m Opening Net Debt (411.8) (325.0) Cash Generated from Operations 126.2 112.5 Net Finance Costs (16.5) (10.8) • Operating cash flow after net finance costs and pre-working capital FINANCIAL
Slide 17: Capital Structure
Capital Structure BIG YELLOW GROUP FULL YEAR RESULTS FINANCIAL 31.03.23 31.03.22 • The Group’s gross property assets are £2.7 billion, with an adjusted NAV per share of £12.37 APPENDIX Net Debt / Gross Property Assets 18% 16% • Balance sheet gearing ratios increased with higher absolute levels of de
Slide 18: Debt Facilities
Debt Facilities BIG YELLOW GROUP FULL YEAR RESULTS AVERAGE 31.03.23 DEBT EXPIRY FACILITY INTEREST DRAWN COST Aviva Loan September 2028 £158.9 million £158.9 million 3.4% FINANCIAL M&G Loan September 2029 £120 million £120 million 5.2% APPENDIX Revolving Bank Facility (Lloyds, HSBC and B of I) Octobe
Slide 19: Property Review
PROPERTY REVIEW Manchester, May 2019 19
Slide 20: New Site Development
New Site Development BIG YELLOW GROUP FULL YEAR RESULTS • Our landmark 103,000 sq ft Kings Cross store is due to open in June 2023. The store will also include flexi-offices and wine storage and we expect it to trade well • Continued strategy of reducing leasehold exposure – by value our estate is n
Slide 21: Development Pipeline With Planning
Development Pipeline With Planning BIG YELLOW GROUP FULL YEAR RESULTS ANTICIPATED CAPACITY SITE PROMINENT LOCATION STATUS SQ FT Kings Cross, London York Way Opening in Summer 2023 103,000 PROPERTY REVIEW Discussions ongoing to secure Wembley, London Towers Business Park 70,000 vacant possession Quee
Slide 22: Development Pipeline Without Planning
BIG YELLOW GROUP Development Pipeline Without Planning FULL YEAR RESULTS ANTICIPATED CAPACITY SITE PROMINENT LOCATION STATUS SQ FT Site acquired in July 2020. Appeal submitted with On the Highway, adjacent Wapping, London public inquiry set for July 2023 with decision likely Additional 95,000 PROPER
Slide 23: Our Portfolio
Our Portfolio BIG YELLOW GROUP FULL YEAR RESULTS KEY 84 Big Yellow stores (46 in London) 13 Big Yellow stores under development (10 in London) 24 Armadillo stores (1 in London) Outside London 64 stores and sites London 57 stores and sites PROPERTY REVIEW 23 23
Slide 24: Summary
Summary BIG YELLOW GROUP FULL YEAR RESULTS • A resilient performance with growth in revenue, earnings and cash flow in a challenging macroeconomic, political and geo-political environment • Our revenue management and control of costs has seen an improvement in store EBITDA margin over the year SUMMA
Slide 25: Appendix
APPENDIX Hove, September 2022
Slide 26: Sustainability Update
Sustainability Update BIG YELLOW GROUP FULL YEAR RESULTS • We now have our Science-Based Targets fully verified to reinforce our pathways to 100% renewable energy and zero carbon emission plan by 2040 • The retro-fit programme is projected to cost £20 to £25 million of which £8.3 million has been in
Slide 27: Pathway To 100% Renewable Energy And Zero Carbon Emission Plan
BIG YELLOW GROUP Pathway To 100% Renewable Energy And Zero Carbon Emission Plan To 2030 & 2040 FULL YEAR RESULTS • Our ambition is for Big Yellow to be fully aligned to the UK Government’s commitments to sustainability by addressing our emissions by 2050, at the latest • Our two 2030 targets are int
Slide 28: Decarbonising Our Business To March 2023
Decarbonising Our Business To March 2023 BIG YELLOW GROUP FULL YEAR RESULTS Absolute Scope 1 & 2 GHG (2020 to 2032) tCO2e reported and projected 3500 • Location-based Scope 1 (6% - gas, refrigerant & van) and 2 3000 (94% - electricity). Emissions reduced by 25% reduction 2500 from our base year 2019
Slide 29: Science-Based Targets
Science-Based Targets BIG YELLOW GROUP FULL YEAR RESULTS • After a lengthy review process we now have our Science-Based Targets fully verified. These are as follows: − Big Yellow Group commits to reduce absolute Scope 1 and 2 GHG emissions 70% by FY2032-33 from a FY2019-20 base year − Big Yellow Gro
Slide 30: ESG Investor Benchmarks, ESG Standards And Campaigns
ESG Investor Benchmarks, ESG Standards And Campaigns BIG YELLOW GROUP FULL YEAR RESULTS BENCHMARKS AND STANDARDS CAMPAIGNS CDP (Carbon Disclosure Project) • Official supporter of the TCFD (Task Force on Climate-related Financial Disclosures) since September 2021 • Big Yellow participated since 2012;
Slide 31: Social
Social BIG YELLOW GROUP FULL YEAR RESULTS • Several successful work placements through our charity partners and local colleges; − A young man with Down’s syndrome at our Cardiff store. His successful 12 week placement was extended by 6 months − A female refugee at our Tolworth store. Her successful
Slide 32: Marketing And Sales Update
Marketing And Sales Update BIG YELLOW GROUP FULL YEAR RESULTS • Big Yellow has market-leading brand awareness - five times higher than the next nearest competitor • Continued investment in digital to drive prospect growth - key to our success with over 90% of prospects online, 66% of visits from mob
Slide 33: The Importance Of The Brand
The Importance Of The Brand BIG YELLOW GROUP FULL YEAR RESULTS • Self storage is a consumer facing business for both domestic and small business markets • Done right, brand sits at the heart of a business and drives its performance • Self storage is an immature market with 70% first time users - the
Slide 34: Research Of Brand And Market Awareness
Research Of Brand And Market Awareness BIG YELLOW GROUP FULL YEAR RESULTS UNPROMPTED BRAND AWARENESS • YouGov commissioned survey by the UK Self Storage Association in January 2023 • Measures unprompted brand awareness • 2,102 adults sample APPENDIX • Statistically selected and weighted sample that
Slide 35: High Brand Awareness = High Online Market Share
High Brand Awareness = High Online Market Share BIG YELLOW GROUP FULL YEAR RESULTS • Over 90% of our prospects come from our digital platforms. 66% of web visits are from smartphones, 32% from desktop and laptop use with the remaining 2% of web visits from tablets (April 2022 to March 2023) APPENDIX
Slide 36: Customer Insights
Customer Insights BIG YELLOW GROUP FULL YEAR RESULTS • Wide-ranging demographic and domestic customer base; extended families, couples, singles, renters, students, downsizers, space constrained home dwellers • Over 70% of our customers are in the top 3 ACORN categories; Affluent Achievers, Rising Pr
Slide 37: Social Media, PR And Display
Social Media, PR And Display BIG YELLOW GROUP FULL YEAR RESULTS • Targeted YouTube advertising to domestic and business audiences in need of APPENDIX self storage • ESG focussed social media content on Twitter, Instagram and Facebook • LinkedIn spotlights our company culture, employee development, r
Slide 38: Reasons For Using Self Storage
Reasons For Using Self Storage BIG YELLOW GROUP FULL YEAR RESULTS % of customer numbers by type Reasons people used our storage who moved-in during the year Domestic 79% 6% 79% Travelling 5% Business 21% 12% 21% Student storage 9% Other 13% % of store space occupied by customer type 14% APPENDIX 63%
Slide 39: National Customers
National Customers BIG YELLOW GROUP FULL YEAR RESULTS • Businesses can store at multiple locations nationwide through one dedicated point of contact APPENDIX • Our extended network of third party providers enables customers to have a single self storage supplier relationship • We provide a range of
Slide 40: Local Economy Value Of Business Customers
Local Economy Value Of Business Customers BIG YELLOW GROUP FULL YEAR RESULTS • External business survey previously commissioned to assess impact of average Big Yellow store on the local economy • The average store has over 100 different businesses who between them employ 300 people APPENDIX • 60% of
Slide 41: Length Of Stay Of Customers Vacating In Financial Year
Length Of Stay Of Customers Vacating In Financial Year BIG YELLOW GROUP FULL YEAR RESULTS 2023 9.1 2022 8.4 2021 9.2 2020 8.5 2019 8.4 APPENDIX 2018 7.8 2017 7.5 2016 7.5 2015 7.2 2014 7.6 2013 7.0 2012 7.2 2011 7.1 2010 8.1 2009 8.6 2008 7.4 41 41
Slide 42: Customer Average Length Of Stay
Customer Average Length Of Stay BIG YELLOW GROUP FULL YEAR RESULTS AS AT NUMBER OF MONTHS 31/03/2023 0-3 YEARS >3 YEARS BIG ARMADILLO ALL STORES ALL STORES YELLOW 31/03/2022 No of Stores 9 75 84 24 108 103 Business Existing 9.6 36.9 35.2 38.9 35.1 33.6 APPENDIX Vacated 4.2 12.1 12.1 15.0 12.4 12.1 T
Slide 43: Self Storage Market
Self Storage Market BIG YELLOW GROUP FULL YEAR RESULTS Key Influencers • Growing public awareness • Change in economic activity and GDP growth • Population mobility and investment in existing homes • Physical planning and constraints, smaller homes • Focus on high density development on brownfield s
Slide 44: Track Record Since 2007-8
Track Record Since 2007-8 BIG YELLOW GROUP FULL YEAR RESULTS • 3.8 million sq ft increase in MLA capacity and 3.5 million sq ft increase in occupied space from 1 April 2007 to 31 March 2023 • Revenue for March 2023 more than tripled since 2008 to £171.3 million APPENDIX • More than fourfold increase
Slide 45: Track Record Since 2007-8
Track Record Since 2007-8 BIG YELLOW GROUP FULL YEAR RESULTS Occupancy(1) and Average Rate Revenue (£m) 90% £32.00 200 80% 180 70% £30.00 160 60% 140 £28.00 50% 120 40% 100 £26.00 30% 80 20% £24.00 60 10% 40 0% £22.00 20 APPENDIX 0 Occupancy (%) Average net rent (£ per sq ft) Adjusted EPS (pence) Di
Slide 46: Big Yellow Relative TSR Performance
Big Yellow Relative TSR Performance BIG YELLOW GROUP FULL YEAR RESULTS Big Yellow FTSE All Share FTSE 350 Real Estate 3,000 2,500 2,000 APPENDIX 1,871.5% (13.9% p.a.) 1,500 1,000 500 206.3% (5.0% p.a.) 166.3% (4.4% p.a.) 0 2000 2002 2004 2006 2007 2009 2011 2013 2015 2017 2019 2021 2023 Source: Data
Slide 47: Big Yellow Portfolio
Bracknell, September 2020 MLA -59000sq ft Kingston North, September 2022 MLA - 56,000sqitt Hayes, January 2022 Uxbridge, June 2021 MLA -73,000sq ft MLA - 54,0005sq ft Wapping, July 2018 MLA - 260 Q (7) < m c ° = v 8 sa nm ° —) °
Slide 48: Big Yellow Portfolio
[i cca i a 2 Twickenham 2, April 2016 Nine Elms, April 2016 Cambildge, January 2016 Enfield, April 2015 ‘Chester, February 2015 Oxtord 2, July 2014 MLA - 22000 sqft MLA -65,000 sqtt MLA ~60000 sqft MLA ~ 60,000 sqtt MLA-€,0005q ft MIA - 35,000sqit Gypsy Corner, April 2014 Chiswick, April 2012 ~~ Now
Slide 49: Big Yellow Portfolio
——— 6) lg cx) (num i Reception id — y i Eas fee | : ki ST i _ L = Kennington, May 2008 Merton, March 2008 Fulham, March 2008 Balham, March 2008 Barking, November 2007 Ealing Southall, November 2007 MLA - 66,000 sqft MILA - 70000 sq ft MLA ~ 138000 sq ft MLA - 61000 sqft MLA - 64000 sq ft MLA - 57000
Slide 50: Big Yellow Portfolio
= = 2 el =tt West Norwood, January 2003 Colchester, December 2002 Bow, November 2002 Brighton, October 2002 Guildford Slyfield, June 2002 New Malden, May 2002 MLA - £7,000 sqft MLA - 54000 sqft MLA - 1320005 ft MLA - 59000 sq it MLA - 55,000 sqft MLA - 81000 sqft Cardiff, October 2001 Portsmouth, Oc
Slide 51: Armadillo Portfolio
Dundee Gateshead MLA -39000sqtt MLA - 46000sq tt Canterbury Daventry MLA- %,000sqit MLA -26000sq ft Liverpool Aintree Liverpool Bootle Liverpool South Macclesfield MLA - 40000 sq tt MLA - 49,000 sq tt MLA -35000sq tt MLA -50000sq ft MLA - 63000sq tt s- O104LYOd OTIIGVINYY Newcastle Peterborough Plym
Slide 52: Disclaimer
Disclaimer BIG YELLOW GROUP FULL YEAR RESULTS This presentation contains certain statements that are neither reported financial results nor other historical information. These statements are forward-looking in nature and are subject to risks and uncertainties. Actual future results may differ materi