TIDMLOK
RNS Number : 6771L
Lok'nStore Group PLC
23 April 2018
LOK'NSTORE GROUP PLC
("Lok'nStore" or "the Group")
Lok'nStore Group Plc, the fast growing self-storage company
announces interim results for the six months to 31 January 2018
"Strong cash flows and balance sheet fund growth strategy and
pipeline of new landmark stores"
Highlights:
Strong trading and cash flow
-- Revenue GBP8.82 million up 5.7% (31.1.2017: GBP8.34 million) LFL(1) up 8.3%
-- Group operating costs down by 1.4% at GBP4.80 million (31.1.2017: GBP4.87 million)
-- Group Adjusted EBITDA(2) GBP3.85 million up 16.3% (31.1.2017: GBP3.31 million)
-- Adjusted pre-tax profit GBP2.55 million up 21.3% (31.1.2017: GBP2.10 million)
Cash flow growth supports 11.0% dividend increase - progressive
dividend policy
-- Cash available for Distribution (CAD) (3) GBP2.96 million up
13.0% (31.1.2017: GBP2.62 million)
-- Cash available for Distribution (CAD) per share (annualised)
20.5 pence (31.1.2017: 18.6 pence) up 10.2%
-- Interim dividend 3.33 pence per share up 11.0% (31.1.2017: 3 pence per share)
Significant growth in asset value
-- Adjusted Net Asset Value (NAV) per share(4) up 7.9% to GBP4.18 (31.1.2017: GBP3.87)
-- Total assets(5) up to GBP154.5 million up 8.4% (31.1.2017: GBP142.6 million)
Strong balance sheet, efficient use of capital, low debt
-- Net debt GBP23.45 million (31.1.2017: GBP16.67 million)
-- Loan to value(6) ratio 16.8% (31.1.2017: 14.4%)
-- Average cost of debt 1.72% (31.1.2017: 1.69%)
-- Post period-end: Bank facility increased by GBP10 million to GBP50 million
Consistent performance of the self-storage business
-- Core self-storage revenue GBP7.32 million up 4.5% (31.1.2017: GBP7.0 million) LFL up 7.6%
-- Adjusted Store EBITDA(7) GBP4.29 million up 11.6% (31.1.2017:
GBP3.85 million) LFL up 14.4%
-- Store EBITDA margin increased to 58.6% from 54.5%
-- Occupied units pricing up 0.4% LFL
-- Unit Occupancy up 6.0% LFL
Healthy pipeline of new landmark stores(8)
-- 2 new stores opened in this period in Gillingham and Hemel Hempstead
-- 2 new sites acquired in this period in Bedford and Bournemouth
-- Current pipeline of 7 contracted stores adds 26% of extra
trading space to the overall portfolio, 22% to
our owned portfolio and 41% to the managed portfolio
-- 4 pipeline sites are currently with lawyers
-- Following successful completion of the pipeline, we will have
11 stores under management contracts
Confident outlook
-- Positive momentum carried into second half
-- The Group continues to grow strongly
Commenting on the Group's results, Andrew Jacobs CEO of
Lok'nStore Group said,
"With strong trading and reduced costs Lok'nStore's profits and
margins continue to grow rapidly. We are using our robust balance
sheet to invest in the future growth of the business building more
new landmark stores in a structurally under-supplied market. We
have opened 2 new stores in the period and added 2 more to our
pipeline with four more sites currently with lawyers.
"Our objective is to open more landmark stores while remaining
conservatively geared delivering sustainable growth and
consistently increasing dividends."
Enquiries:
Lok'nStore:
Andrew Jacobs, CEO
Ray Davies, Finance Director 01252 521 010
finnCap Ltd
Julian Blunt / Giles Rolls, Corporate
Finance
Alice Lane, Corporate Broking 020 7220 0500
Camarco
Billy Clegg / Tom Huddart 0203 757 4980
Notes - What we mean when we say ... (and why we use these key
performance indicators (KPIs))
1. LFL- Like for like - This measure is used to give
transparency on performance in the operating business unrelated to
the opening of new stores or closure of old stores therefore giving
visibility of the true trading picture. During December 2016 and
January 2017 Lok'nStore closed its store in Staines. Our new store
in Gillingham opened in December 2017. Like-for-like (LFL) growth
figures for the period strip out these 2 effects.
2. Group Adjusted EBITDA - Earnings before interest, tax,
depreciation and amortisation - The measure is designed to give
clarity on the operating cash flow of the business stripping away
non-cash charges, finance charges and tax. Adjusted EBITDA is
defined as earnings before all depreciation and amortisation
charges, losses or profits on disposal, share-based payments,
acquisition costs, exceptional costs finance income, finance costs
and taxation.
3. CAD - Cash available for Distribution - is calculated as
Adjusted EBITDA minus total net finance cost, less capitalised
maintenance expenses, New Works Team costs and current taxation.
This measure is designed to give clarity to the capacity of the
business to generate net operating cash that can be used to pay
dividends to shareholders on a continuing basis.
4. NAV - Adjusted Net Asset Value per share - Adjusted net asset
value per share is the net assets of the business adjusted for the
valuation of leasehold stores and deferred tax divided by the
number of shares at the year-end. The shares held in the Group's
employee benefits trust and any treasury shares are excluded from
the number of shares.
5. Total assets - Total assets of GBP154.5 million is calculated
by adding the independent valuation of the leasehold properties
(GBP16.7 million) less their corresponding net book value (NBV) of
GBP2.8 million to the total assets as shown in the balance sheet of
GBP140.6 million.
6. LTV - Loan to value ratio - measures the 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 of GBP23.5 million (31.1.2017: GBP16.7 million)
as a percentage of the total properties independently valued by JLL
and including development land assets totalling GBP139.7 million
(31.1.2017: GBP118.5 million) as set out in the Business and
Financial Review.
7. Store adjusted EBITDA is Adjusted EBITDA (see 3 above) before
the deduction of central and head office costs.
8. Pipeline sites - 11 sites including 7 sites which have been
contracted and 4 sites which are currently progressing to contract
with lawyers.
Glossary
Abbreviation
Adjusted EBITDA Earnings before all depreciation and
amortisation charges, losses or profits on disposal, share
basedpayments, acquisition costs, and non-recurring professional
costs, finance income, finance costs and taxation
CAD Cash available for Distribution
Capex Capital Expenditure
CSOP Company Share Option Plan
EBT Employee Benefit Trust
EMI Enterprise Management Incentive Scheme
ESOP Employee Share Option Plan
EU European Union
HMRC Her Majesty's Revenue & Customs
IAS International Accounting Standard
IFRIC International Financial Reporting Interpretations Committee
IFRS International Financial Reporting Standard
JLL Jones Lang LaSalle
LIBOR London Interbank Offered Rate
LFL Like for like
LTV Loan to Value Ratio
NAV Net Asset Value
NBV Net book value
Operating Profit Earnings before interest and tax (EBIT)
RICS Royal Institution of Chartered Surveyors
Sq. ft. Square Feet
Store adjusted
EBITDA Adjusted EBITDA (see above) but before central and head office costs
VAT Value Added Tax
Chairman's Statement
Healthy growth, increased dividend and active store opening
programme
Lok'nStore continues to grow rapidly as evidenced by these
strong results and the increased dividend. This growth will
continue. We have the people and the balance sheet strength to buy
and build many more landmark stores.
New sites can be difficult to find. The understandable desire to
preserve 'greenfield' spaces and the restrictive planning laws that
this necessitates leads to high land prices. This is why the UK
self-storage market remains structurally undersupplied. However
improvements in our store acquisition, design and development
processes have resulted in the biggest pipeline of new landmark
stores in the company's history.
These smart, modern buildings, which already make up over
two-thirds of the space Lok'nStore owns, so the Board looks forward
to further expansion with confidence.
Positive trading
For the half year period to January 2018 trading has been good
with revenue, profits and assets all increasing.
An increase in Group revenue of 5.7% to GBP8.82 million
(31.1.2017: GBP8.34 million) resulted mainly from occupancy growth
with prices holding steady. Stripping out the effect of the Staines
closure and the early trading from our new store in Gillingham,
like for like Group revenue increased by 8.3%.
Progressive Dividend
Dividend payments will reflect the growth in the underlying cash
generated by the business as reflected in the cash available for
distribution (CAD) which is up 13% period to period.
At this interim stage we will pay one third of the previous
year's total annual dividend which equates to 3.33 pence per share,
up 11.0% on the 3.00 pence per share interim dividend last year.
The increase in the interim dividend follows a consistent pattern
of dividend growth reflecting the sustained growth of the Group.
The interim dividend will be paid on 15 June 2018 to shareholders
on the register on 4 May 2018. The ex-dividend date will be 3 May
2018. The final deadline for Dividend Reinvestment Election is 21
May 2018. The final dividend will be declared when the Group's full
year results are announced.
Balance Sheet and financial platform strengthened to support a
rapid store development programme
Lok'nStore has worked to increase the value of its assets and
this is reflected in our higher NAV and low LTV metrics. Our bank
facilities run until 2023 and were increased post balance sheet by
GBP10 million to GBP50 million with no change to underlying
covenants. We continue to benefit from low interest costs. This is
all reported in more detail in the remainder of the Statement.
The growth of sales, profit and asset values combined with
innovative asset management allows us to report a loan-to-value
(LTV) ratio of only 16.8% (31.1.2017: 14.4%) and net debt of
GBP23.5 million (31.1.2017: GBP16.7 million) while we invested
GBP10.9 million in store development in this period.
The Group continues to source high quality sites. Our rapid
store development programme has led to an increase in new and
purpose built space to 64% of our owned portfolio. Trading at our
new landmark stores has been excellent. This underpins our
confidence that our strong pipeline of seven more landmark stores
will add further momentum to sales and earnings growth. They will
add 26% more trading space to our portfolio.
Reduced Operating Costs
We have a strong record of reducing our group operating costs
each year however we cautioned at our 2017 year end results that
although we maintain a disciplined approach to costs, continuing to
reduce them is increasingly challenging while delivering both
strong revenue growth and an acceleration of our store opening
programme. Nevertheless in this period we have reduced Group
operating costs which are down 1.4% and we provide a breakdown in
the Business Review. Any future cost increases will be driven by
the increase in number of stores, chiefly showing in local business
rates, staffing and advertising. However we are not seeing
significant cost pressures outside of these areas.
Group margins will increase by building more landmark freehold
stores and increasing the number of managed stores we operate from
a broadly unchanged central cost platform. Group Adjusted EBITDA
margins in the period were 43.7% up from 39.7% in the corresponding
period last year.
Lok'nStore increases its existing GBP40 million Banking Facility
to GBP50 million (Post Balance sheet)
In February 2018, after the period-end the Group increased its
bank facility by GBP10 million to GBP50 million. The increased
facility will provide funding for landmark site acquisitions and
working capital to support the Group's ambitious growth plans.
The facility was originally agreed with The Royal Bank of
Scotland plc in January 2016 and the term extended in January 2017.
This larger facility runs until January 2023. The interest rate is
set at the London Inter-Bank Offer Rate (LIBOR) plus a 1.40%-1.65%
margin based on a loan to value covenant test (currently the margin
is 1.40%). Bank covenants and margin are unaffected by this
increase in facility.
The cost of our debt on GBP28.8 million drawn (gross) averaged
1.72% in the period.
Positive Outlook for Growth
Lok'nStore is a dynamic business designed to deliver significant
future growth with an established record of consistent profit and
cash generation. It is particularly pleasing to note that the
momentum reported earlier in the year has translated into a strong
start to the second half.
Our main objective is to steadily increase the cash available
for distribution (CAD) per share enabling a predictable growth of
the dividend from a strong asset base with conservative levels of
debt.
In order to achieve this our focus will be on three key
areas:
1. Fill stores and improve pricing to increase cash flow from the existing stores
2. Acquire sites to build more landmark stores
3. Increase the number of stores we manage for third parties
Our current pipeline of 11 new stores will contribute to the
achievement of these objectives.
Finally, I should like to thank all of our employees for the
huge contribution they have made to the Group's success. Managing
growth is a key challenge to organisations. It is a challenge which
our staff are meeting with expertise, dedication and
enthusiasm.
Simon G Thomas
Chairman
20 April 2018
Business and Financial Review
The Performance of our Stores - Self-storage business steady
-- Self-storage revenue GBP7.32 million up 3.8% (31.1.2017: GBP7.00 million) LFL up 6.9%
-- Adjusted Store EBITDA GBP4.29 million up 11.6% (31.1.2017: GBP3.85 million) LFL up 14.4%
-- Unit occupancy increased 6.0% year on year on a like for like
basis to 66% of current lettable area (CLA)
-- Occupied units pricing up 0.4% LFL
With operating costs firmly under control during the period
(down 1.4%) steady revenue growth has translated into healthy
profit growth. Total adjusted store EBITDA in the self-storage
business, a key performance indicator of profitability and cash
flow of the business, increased 11.6% to GBP4.29 million
(31.01.2017: GBP3.85 million). Like for like growth in store EBITDA
was 14.4%.
The overall adjusted EBITDA margin across all stores was up at
58.6% (31.1.2017: 54.5%) with the adjusted Store EBITDA margins of
the freehold stores at 66.9% (31.1.2017: 62.9%) and the leasehold
stores at 44.1% (31.1.2017: 41.3%).
Over the course of the year unit occupancy rose by a healthy
6.0% LFL and unit pricing growth was up 0.4 % LFL.
As you can see from the table below 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 store
EBITDA margin (66.9% and 100% respectively versus 58.6% across all
stores). The impact of this is to continue to increase the average
store EBITDA margin of the Group overall, and this effect is
accentuated by operating more stores from a relatively fixed
central cost base. In this context the new stores in the pipeline
will over time make a larger than average contribution to Group
profits as they become established trading units.
At the end of January 2018, 34.8% of Lok'nStore's self-storage
revenue was from business customers (31.1.2017: 34.5%) with the
remainder from household customers. By number of customers 18.8% of
our customers were business customers (31.1.2017: 19.7%).
When Fully Developed
Portfolio Analysis Number % of Property % of Adjusted Adjusted % lettable Number Total
and Performance of stores Valuation Store EBITDA Store space of stores % lettable
Breakdown EBITDA Lok Owned space
Margin
(%)
----------- -------------- -------------- --------- ----------- ----------- ------------
As at 31 January
2018
----------- -------------- -------------- --------- ----------- ----------- ------------
Freehold and
long leasehold
stores 13 87.7 72.7 66.9 65.8 17 54.3
----------- -------------- -------------- --------- ----------- ----------- ------------
Operating Leaseholds
stores 7 12.3 27.3 44.1 34.2 7 21.2
----------- -------------- -------------- --------- ----------- ----------- ------------
Managed Stores 8 100 11 24.5
----------- -------------- -------------- --------- ----------- ----------- ------------
Total stores
trading 28 35
----------- -------------- -------------- --------- ----------- ----------- ------------
Pipeline stores
----------- -------------- -------------- --------- ----------- ----------- ------------
Owned 4
----------- -------------- -------------- --------- ----------- ----------- ------------
Managed 3
----------- -------------- -------------- --------- ----------- ----------- ------------
Total Self Storage 35 100 100 58.6 100 35 100
----------- -------------- -------------- --------- ----------- ----------- ------------
Document Storage 2 - - - - 2 -
---------------------- ----------- -------------- -------------- --------- ----------- ----------- ------------
Total freeholds and long leasehold stores account for 88% of
total property values.
Ancillary Sales
Ancillary sales consisting of boxes and packaging materials,
insurance and other sales increased 1.1% over the year accounting
for 10.8% of self-storage revenues (31.1.2017: 11.1%). We continue
to promote customer goods insurance to new customers with the
result that 91% (31.1.2017: 90%) of our new customers purchased the
product over the period. This has resulted in nearly 80% of our
customers being insured through Lok'nStore.
Saracen - Document storage business
-- Revenue GBP1.18 million up 2.6% (31.01.2017: GBP1.15 million)
-- Adjusted EBITDA GBP0.36 million up 43.6% (31.01.2017: GBP0.25 million)
In Saracen we have further reduced cost by vacating surplus
property and this has helped to increase Adjusted EBITDA
significantly up 43.4% from a steady increase in turnover compared
to the corresponding period last year. This is part of a continuing
strategy within the document storage business of optimising the
utilisation of trading space which has now been consolidated into
two trading units.
Our Stores
Lok'nStore has 28 freehold, leasehold and managed stores
trading. Of these, 20 stores are owned with 13 freehold or long
leasehold, 7 leasehold and 8 further sites operate under management
contracts.
The average unexpired term of the Group's operating leaseholds
is approximately 10 years and 2 months as at 31 January 2018 (11
years and 2 months: 31 January 2017). All of our current leasehold
stores are inside the Landlord and Tenant Act providing us with a
strong security of tenure.
Growth from new stores and more new landmark stores to come
Lok'nStore's strong operating cash flow, solid asset base, and
tactical approach to its store property portfolio provide the Group
with opportunities to improve the terms of its property usage in
all stages of the economic cycle. Our focus on the trading business
gives us many opportunities and our property decisions are always
driven by the requirements of the trading business.
-- Early trading at Gillingham has been excellent
-- New and purpose built stores lettable space 64% of portfolio
-- 4 further new store opportunities identified and are progressing with lawyers
-- Current pipeline of 7 contracted stores adds 26% of extra
trading space to the overall portfolio, 22% to our owned portfolio
and 41% to the managed portfolio
Development of four new landmark stores
Wellingborough, Bedford, Bournemouth, and Leicester.
Wellingborough
The Wellingborough site is in a prominent retail location with
large catchment areas and little established competition. The total
capital investment of approximately GBP5 million has been financed
from cash flow and our bank facility. After the period-end we
completed the development and the store opened on 23 March
2018.
Purchase of the Bedford site
On 1 December 2017 contracts were completed on the purchase of a
site in Bedford which will be developed as a purpose built landmark
store. The site is in a prominent location to the South-East of
Bedford town centre, adjacent to a modern retail park and a large
food retailer on a very busy arterial road. Net capital expenditure
of GBP6 million will be funded from cash flow and existing banking
facilities. Subject to the completion of all planning matters the
store is scheduled to open in 2019 and deliver around 55,000 sq.
ft. of trading space.
Acquisition of a freehold site for a new landmark store in
Bournemouth, Dorset
The 3-acre site is in a highly prominent location on Castle
Lane, adjacent to a major food retailer and Bournemouth Hospital.
Building work will follow completion of all relevant planning
matters, and the circa GBP8 million of net capital expenditure will
be funded from cash flow and existing banking facilities. Opening
is scheduled for 2019. When developed, this store will add around
80,000 sq. ft. of trading space.
Post Balance Sheet: Acquisition of a freehold site for a new
landmark store in Leicester (subject to planning)
The 1 acre site is in a highly prominent location opposite a
major food retailer in the heart of Leicester's busy retail
district. The total investment of circa GBP8.5 million will be
funded from cash flow and existing banking facilities. When
developed this store will add around 60,000 sq. ft. of trading
space.
More Managed Stores
Over recent years we have been developing our management
services to third party storage owners. We have eleven stores under
management with eight of these open and trading and three in
Exeter, Ipswich and Dover under development and scheduled to open
in 2018/19.
In the case of managed stores Lok'nStore receives a standard
monthly fee, a performance fee based on certain objectives and a
fee on successful exit. In some cases we charge acquisition,
planning and branding fees. This allows us to earn revenue from our
expertise and knowledge of the self-storage industry without having
to commit our capital, to amortise various fixed central costs over
a wider operating base, and to drive more visits to our website
moving it up the rankings and benefitting all the stores we both
own and manage.
In this period we earned GBP0.31 million (31.1.2017: GBP0.18
million) in management fees. We expect this to increase steadily
over the coming years.
Management fees Six months ended Six months ended
31 January 2018 31 January 2017
Unaudited Unaudited
GBP GBP
------------------ ----------------- -----------------
Total management
fees 311,524 180,881
------------------ ----------------- -----------------
Three stores currently being developed under management
contracts
ü Exeter - scheduled to open next financial year
ü Ipswich - scheduled to open next financial year
ü Dover - scheduled to open next financial year
Summary - Stores Property review
The most recent site acquisition in Leicester increases our
pipeline of new landmark stores which are legally secured, to
seven. All are in prominent locations with large catchment areas
and little established competition and demonstrate the Company's
ability to source high quality sites adding to future sales and
earnings growth. 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
contributor of new customers. We are in the final stages of
construction at Wellingborough and the early stages of construction
at both Dover and Exeter. Bedford, Ipswich, Bournemouth and
Leicester are all in the design and planning stage. All of these
new stores will be open by the end of 2019. This will increase the
number of stores we operate to 35 and will capitalise on our
efficient operating systems and growing internet marketing
presence.
Flexible approach to site acquisition
We continue our strategy of actively managing our store
operating portfolio to ensure we are maximising both trading
potential and asset value. This includes strengthening our
distinctive brand, increasing the size and number of our stores and
replacing stores or sites where it will increase shareholder value.
We prefer to own freeholds if possible, and where opportunities
arise we will seek to acquire the freehold of our leasehold stores.
However we are happy to take leases on appropriate terms and
benefit from the advantages of a lower entry cost, with further
options to create value later. Our most important consideration is
always the trading potential of the store rather than the type of
property tenure.
Store property assets and Net Asset Value
-- Total assets now GBP154.5 million up 8.4% (31.1.2017: GBP142.6 million)
-- Adjusted net asset value of GBP4.18 per share up 7.9% on last year
Financial results
-- Group Revenue GBP8.82 million up 5.7% (31.1.2017: GBP8.34 million) LFL up 8.3%
-- Group Adjusted EBITDA GBP3.85 million up 16.3% (31.1.2017: GBP3.31 million)
-- Average cost of debt currently 1.72% (31.1.2017: 1.69%)
-- LTV still only 16.8% (31.1.2017: 14.4%)
-- Cash available for Distribution (CAD) GBP2.96 million up
13.0% (31.1.2017: GBP2.62 million)
-- Interim dividend up 11% to 3.33 pence per share (31.1.2017: 3.00 pence per share)
-- Cash balances GBP5.4 million (31.1.2017: GBP12.1 million)
-- Investment in new stores GBP10.9 million (31.1.2017: GBP2.8 million)
Lok'nStore is a robust business which generates an increasing
cash flow from its strong asset base. With a low LTV of 16.8% and
low interest margins of 1.4% on its extended banking facility the
business has a firm base for growth. The value of the Group's
property assets underpins a flexible business model with stable and
rising cash flows and low credit risk.
Management of interest rate risk
With GBP28.8 million of gross debt currently drawn against the
GBP50 million bank facility the Group is not committed to enter
into hedging instruments going forwards but rather to keep such
matters under review.
It is not the intention of the Group to enter into an interest
rate hedging arrangement at this time given our low level of debt,
low loan to value ratio and high interest cover.
Taxation
The Group has made a current tax provision against earnings in
this period of GBP0.49 million (31.1.2017: GBP0.42 million) based
on a corporation tax rate of 20%. The deferred tax provision which
is calculated at forward corporation tax rates of 17% and is
substantially a tax provision against the potential crystallisation
(sales) of revalued properties and past 'rolled over' gains amounts
to GBP16.63 million. (31.1.2017: GBP14.45 million) (See Note
16).
Earnings per share
Basic earnings per share were 6.70 pence (31.1.2017: 6.91 pence
per share) and diluted earnings per share were 6.58 pence
(31.1.2017: 6.74 pence per share) showing small declines due to the
increased number of shares in issue.
Reduced Operating costs
Group operating costs amounted to GBP4.80 million for the
period, a 1.4% decrease year on year (31.1.2017: GBP4.87
million).
We have a strong record of reducing our group operating costs
each year however we cautioned at our 2017 year end results that
although we maintain a disciplined approach to costs continuing to
reduce them is increasingly challenging while delivering both
strong revenue growth and an acceleration of our store opening
programme.
For this period we have contained overall costs which are down
1.4% and we provide a breakdown below. Future cost increases are
driven by the expansion of the business in the areas of rates,
staffing and advertising (higher internet marketing costs). Overall
the cost increases are mainly driven by the expansion of the
business and we are seeing little other cost pressures.
Property costs which mainly constitute rent and rates have risen
in recent years as we felt the effects of higher rates bills as we
opened our new landmark stores particularly at Southampton and
Bristol. However we have in this period been able to secure rate
reductions for past periods on these sites and this has contributed
to the reduction in property costs. Rents have remained broadly
static but overall are lower in this period as the closure of
Staines has eliminated rent costs (31.01.2017: GBP62,447) and
utility costs are lower as a result of a renegotiation of our
energy tariffs.
Group Increase Six months Six months Year
(decrease) ended 31 ended 31 ended 31
in costs Jan Jan July
% 2018 2017 2017
GBP'000 GBP'000 GBP'000
-------------------- ------------ ----------- ----------- ----------
Property costs (5.4%) 1,974 2,087 4,179
Staff costs 1.8% 2,194 2,156 4,389
Overheads 1.8% 552 542 1,098
Distribution costs (2.4%) 81 83 171
-------------------- ------------ ----------- ----------- ----------
Total (1.4%) 4,801 4,868 9,837
-------------------- ------------ ----------- ----------- ----------
Cash flow and financing
At 31 January 2018 the Group had cash balances of GBP5.4 million
(31.1.2017: GBP12.1 million). Cash inflow from operating activities
before investing and financing activities was GBP3.76 million
(31.1.2017: GBP2.90 million). As well as using cash generated from
operations to fund some capital expenditure, the Group has a five
year revolving credit facility which runs until January 2023. This
provides sufficient liquidity for the Group's current needs.
Undrawn committed facilities at the period-end amounted to GBP11.2
million (31.1.2017: GBP11.2 million). See also Note 22 (i) (Events
after the Reporting Date).
Gearing
At 31 January 2018 the Group had GBP28.8 million of gross
borrowings (31.1.2017: GBP28.8 million) representing gearing of
26.1% (31.1.2017: 20.7%) on net debt of GBP23.5 million (31.1.2017:
GBP16.7 million). After adjusting for the uplift in value of short
leaseholds which are stated at depreciated historic cost in the
statement of financial position, gearing is 22.6% (31.1.2017:
17.7%). After adjusting for the deferred tax liability carried at
period end of GBP16.6 million gearing drops to 19.5% (31.1.2017:
15.3%).
Cash available for Distribution (CAD) up 13%
Cash available for Distribution (CAD) provides a clear picture
of ongoing cash flow available for dividends. The CAD was up 13% in
the period although at a per share level this was partially offset
by the increase in the number of shares outstanding resulting from
the sale of the Treasury shares. Cash available for Distribution
(CAD) per share (Annualised) was up 10.2% to 20.5 pence
(31.1.2017:18.6 pence).
To illustrate this fully the table below shows the calculation
of CAD.
Analysis of Cash Available for Distribution (CAD)
Six months Six months Year ended
ended 31 January ended 31 January 31 July
2018 2017 2017
GBP'000 GBP'000 GBP'000
Group Adjusted EBITDA 3,852 3,313 6,493
Less: Net finance costs
(per Income Statement) (296) (151) (297)
Capitalised maintenance
expenses (45) (55) (90)
New Works Team (69) (66) (138)
Current tax (485) (424) (792)
------------------ ---------------------- ---------------
Total deductions (895) (696) (1,317)
------------------ ---------------------- ---------------
Cash Available for
Distribution 2,957 2,617 5,176
------------------ ---------------------- ---------------
Increase over last period 13.0%
Number Number Number
Number of shares in
issue (excluding treasury
and EBT shares) 28,806,711 28,084,149 28,679,711
CAD per share (annualised) 20.5p 18.6p 18.0p
Capital expenditure and capital commitments
The Group has grown through a combination of building new
stores, existing store improvements and relocations. We have
concentrated on extracting value from existing assets and
developing through collaborative projects and management contracts.
As we accelerate the store development programme capital
expenditure during the period increased to GBP10.9 million
(31.1.2017: GBP2.8 million). This was primarily the construction
and fitting out work at our development sites in Gillingham and
Wellingborough as well as the acquisition of the Bedford,
Bournemouth and Leicester sites.
Market Valuation of Freehold and Operating Leasehold Land and
Buildings
On 31 July 2017 professional valuations were prepared by Jones
Lang LaSalle (JLL) for eleven freeholds, one long leasehold and
seven operating leasehold properties. This valuation has been
adopted for the 31 January 2018 period-end. The valuation was
prepared in accordance with the RICS Valuation - Professional
Standards, published by The Royal Institute of Chartered Surveyors
(the "Red Book"). The valuation has been provided for accounts
purposes and, as such, is a Regulated Purpose Valuation as defined
in the Red Book.
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.
It is not the intention of the Directors to make any other
significant disposals of trading stores, although individual
disposals may be considered where it is clear that value can be
added by recycling the capital into other opportunities.
The Board will continue to commission independent valuations on
its trading stores annually to coincide with its year-end
reporting.
The valuations of our freehold property assets are included in
the Statement of Financial Position at their fair value, but under
applicable accounting standards no value is included in respect of
our leasehold stores to the extent that they are classified as
operating leases. The value of our operating leases in the
valuation totals GBP16.7 million (31.1.2017: GBP16.6 million).
Instead we have reported by way of a note the underlying value of
these leasehold stores in future revaluations and adjusted our Net
Asset Value (NAV) calculation accordingly to include their value.
This ensures comparable NAV calculations.
Analysis of Total Property Value
31 Jan 31 Jan 2017 31 July
No of 2018 Valuation No of Valuation No of 2017 Valuation
stores/sites GBP'000 stores/sites GBP'000 stores/sites GBP'000
-------------- ---------------- -------------- ------------ -------------- ----------------
Freehold and long
leasehold valued
by
JLL (1) 12 102,900 12 96,125 12 102,900
Leasehold valued by
JLL (2) 7 16,725 7 16,575 7 16,725
-------------- ---------------- -------------- ------------ -------------- ----------------
Freehold land and
buildings at
Director
valuation 1 4,148 1 3,000 1 4,195
-------------- ---------------- -------------- ------------ -------------- ----------------
Subtotal 20 123,773 20 115,700 20 123,820
Sites in
development
at cost 5 15,880 2 2,792 2 5,124
-------------- ---------------- -------------- ------------ -------------- ----------------
Total 25 139,653 22 118,492 22 128,945
-------------- ---------------- -------------- ------------ -------------- ----------------
(1) Includes related fixtures and fittings (refer note 9)
(2) The seven 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 10 years and 8 months at the date of the 2017 valuation
(2016 valuation: 11 years and 8 months).
Total freeholds account for 88.0% of property values (31.1.2017:
86.0%).
Adjusted Net Asset Value per Share
Adjusted net assets per share is 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 are excluded from the number of shares.
At January 2018 the adjusted net asset value per share increased
to GBP4.18 from GBP3.87 year on year, up 7.9%. This is a result of
cash generated from operations offset in part by an increase in the
shares in issue due to the sale of treasury shares and the exercise
of share options during the period.
31 Jan 31 Jan 31 July
2018 2017 2017
Analysis of net asset value (NAV) GBP'000 GBP'000 GBP'000
Unaudited Unaudited Audited
--------------------------------------------------- ----------- ----------- ----------
Net assets 89,775 80,733 89,119
Adjustment to include operating/short leasehold
stores at valuation
Add: JLL leasehold valuation 16,725 16,575 16,725
Deduct: leasehold properties and their
fixtures and fittings at NBV (2,777) (3,006) (2,878)
--------------------------------------------------- ----------- ----------- ----------
103,723 94,302 102,966
--------------------------------------------------- ----------- ----------- ----------
Deferred tax arising on revaluation of
leasehold properties(1) (2,371) (2,307) (2,354)
--------------------------------------------------- ----------- ----------- ----------
Adjusted net assets 101,350 91,995 100,612
--------------------------------------------------- ----------- ----------- ----------
Number Number Number
Shares in issue '000 '000 '000
--------------------------------------------------- ----------- ----------- ----------
Opening shares in issue 29,303 29,109 29,109
Shares issued for the exercise of options 127 90 194
--------------------------------------------------- ----------- ----------- ----------
Closing shares in issue 29,430 29,199 29,303
Shares held in treasury - (492) -
Shares held in EBT (623) (623) (623)
--------------------------------------------------- ----------- ----------- ----------
Closing shares for NAV purposes 28,807 28,084 28,680
--------------------------------------------------- ----------- ----------- ----------
Adjusted net asset value per share after GBP3.52 GBP3.28 GBP3.51
deferred tax provision
--------------------------------------------------- ----------- ----------- ----------
Adjusted net asset value per share before
deferred tax provision
Adjusted net assets 101,350 91,995 100,612
Deferred tax liabilities and assets recognised
by the Group 16,633 14,446 16,363
Deferred tax arising on revaluation of
leasehold properties(1) 2,371 2,307 2,354
--------------------------------------------------- ----------- ----------- ----------
Adjusted net assets before deferred tax 120,354 108,748 119,329
--------------------------------------------------- ----------- ----------- ----------
Closing shares for NAV purposes 28,807 28,084 28,680
--------------------------------------------------- ----------- ----------- ----------
Adjusted net asset value per share before GBP4.18 GBP3.87 GBP4.16
deferred tax provision
--------------------------------------------------- ----------- ----------- ----------
(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.
Corporate and Social Responsibilities
Lok'nStore conducts its business in a manner that reflects
honesty, integrity and ethical conduct. We believe that the
long-term success of the business is best served by respecting the
interests of all our stakeholders. Management of social,
environmental and ethical issues is of high importance to
Lok'nStore. These issues are dealt with on a day-to-day basis by
the Group's managers with principal accountability lying with the
Board of Directors. We look for opportunities to address our
responsibility to the environment, and we pay close attention to
our energy use, carbon dioxide emissions, water use and waste
production. At each year-end Lok'nStore commissions a full
assessment of the Group's environmental impact.
Customers
We believe in clarity and transparency towards our customers.
Brochures and literature are written in plain English, explaining
clearly our terms of business without hiding anything. We are open
and honest about our products and services and do not employ
pressure selling techniques or attempt to take advantage of any
vulnerable groups. If we make a mistake we acknowledge it, deal
with the problem quickly, and learn from our error. We listen to
our customers as we know that they can help us improve our service
to them.
Andrew Jacobs Ray Davies
Chief Executive Officer Finance Director
Consolidated Statement of Comprehensive Income
For the six months ended 31 January 2018
Notes Six months Six months Year ended
ended ended 31 July
31 January 31 January 2017
2018 2017 Audited
Unaudited Unaudited GBP'000
GBP'000 GBP'000
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Revenue 1 8,819 8,343 16,654
Total
property,
staff,
distribution
and general
costs 2a (4,967) (5,030) (10,161)
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Adjusted
EBITDA(1) 3,852 3,313 6,493
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Amortisation
of intangible
assets (83) (83) (165)
Depreciation (962) (897) (1,856)
Equity settled
share based
payments 18 (17) (48) (97)
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
(1,062) (1,028) (2,118)
Store
relocation
costs - (21) (29)
Property
disposal
costs - (14) (15)
Director
retirement
costs - - (69)
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
(1,062) (1,063) (2,231)
Operating 4,262
profit 2,790 2,250
Finance income 3 71 174 309
Finance cost 4 (314) (325) (606)
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Profit before
taxation 5 2,547 2,099 3,965
Income tax
expense 6 (621) (229) (904)
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Profit for the
period 1,926 1,870 3,061
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Profit
attributable
to:
Owners of the
parent 19 1,926 1,870 3,061
Other
Comprehensive
Income
Items that
will not be
reclassified
to profit and
loss
Increase in
property
valuation 629 391 7,772
Deferred tax
relating to
change
in property
valuation (119) 499 (932)
510 890 6,840
Items that may
be
subsequently
reclassified
to profit and
loss
Increase in
fair value of
cash
flow hedges - 37 37
Other
comprehensive
income 510 927 6,877
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Total
comprehensive
income for
the period 2,436 2,797 9,938
--------------- ------ ------------------------- ----------------------- ----------------------------------------------
Attributable to:
Owners of the parent 2,436 2,797 9,938
--------------------------------- -------- -------- --------
Earnings per share attributable
to owners of the Parent
Basic 8 6.70p 6.91p 11.02p
Diluted 8 6.58p 6.74p 10.64p
--------------------------------- -------- -------- --------
(1) Adjusted EBITDA is defined in the accounting policies
section of the notes to the interim report.
Consolidated Statement of Changes in Equity
Attributable to owners of the Parent
Share Share Other Revaluation Retained Total
capital premium reserves reserve earnings equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
1 August 2016 - Audited 291 3,567 8,432 45,602 13,583 71,475
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Profit for the period - - - - 1,870 1,870
Other comprehensive income:
Increase in property valuation
net of deferred tax - - - 890 - 890
Decrease in fair value of
cash flow hedges net of deferred
tax - - 37 - - 37
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Total comprehensive income
for the year - - 37 890 1,870 2,797
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Transactions with Owners
Dividend paid - - - - (1,778) (1,778)
Share based payments - - 48 - - 48
Transfers in relation to share
based payments - - (66) - 66 -
Deferred tax credit relating
to share options - - 221 - - 221
Sale of shares from treasury
(net of costs) - 4,704 - - 3,117 7,821
Exercise of share options 1 148 - - - 149
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Total transactions with owners 1 4,852 203 - 1,405 6,461
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Transfer additional dep'n
on revaluation net of deferred
tax - - - (115) 115 -
31 January 2017 - Unaudited 292 8,419 8,672 46,377 16,973 80,733
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Profit for the period - - - - 1,191 1,191
Other comprehensive income:
Increase in property valuation
net of deferred tax - - - 5,950 - 5,950
Total comprehensive income
for the year - - - 5,950 1,191 7,141
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Transactions with Owners
Dividend paid - - - - (859) (859)
Share based payments - - 49 - - 49
Transfers in relation to share
based payments - - (73) - 73 -
Deferred tax credit relating
to share options - - (179) - - (179)
Sale of shares from treasury
(net of costs) - 1,446 - - 624 2,070
Exercise of share options 1 163 - - - 164
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Total transactions with owners 2 1,609 (203) - (162) 1,245
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Transfer additional dep'n
on revaluation net of deferred
tax - - - (162) 162 -
31 July 2017 - Audited 293 10,028 8,469 52,165 18,164 89,119
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Profit for the period - - - - 1,926 1,926
Other comprehensive income:
Increase in property valuation
net of deferred tax - - - 510 - 510
Total comprehensive income
for the year - - - 510 1,926 2,436
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Transactions with Owners
Dividend paid - - - - (2,016) (2,016)
Share based payments - - 17 - - 17
Transfers in relation to share
based payments - - (80) - 80 -
Deferred tax credit relating
to share options - - (16) - - (16)
Exercise of share options 1 234 - - - 235
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Total transactions with owners 1 234 (79) - (1,936) (1,780)
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Transfer additional dep'n
on revaluation net of deferred
tax - - - (148) 148 -
31 January 2018 - Unaudited 294 10,262 8,390 52,527 18,302 89,775
----------------------------------- --------- --------- ---------- ------------ -------------- -----------
Consolidated Statement of Financial Position
31 January 2018
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Assets
Non-current assets
Intangible assets 3,343 3,509 3,428
Property, plant and
equipment 9 127,447 106,628 116,901
Development loan capital 10 - 3,319 3,463
130,790 113,456 123,792
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Current assets
Inventories 11 236 168 203
Trade and other receivables 12 4,192 3,271 4,266
Cash and cash equivalents 5,359 12,140 11,386
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Total current assets 9,787 15,579 15,855
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Total assets 140,577 129,035 139,647
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Liabilities
Current liabilities
Trade and other payables 13 (4,912) (4,522) (5,032)
Taxation (573) (597) (463)
(5,485) (5,119) (5,495)
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Non-current liabilities
Borrowings 15a (28,684) (28,737) (28,670)
Deferred tax 16 (16,633) (14,446) (16,363)
----------------------------- ------ ------------------------------- ---------------------------- ----------------
(45,317) (43,183) (45,033)
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Total liabilities (50,802) (48,302) (50,528)
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Net assets 89,775 80,733 89,119
----------------------------- ------ ------------------------------- ---------------------------- ----------------
Equity
Equity attributable to owners
of the parent
Called up share capital 17 294 292 293
Share premium 10,262 8,419 10,028
Other reserves 18 8,390 8,672 8,469
Retained earnings 19 18,302 16,973 18,164
Revaluation reserve 52,527 46,377 52,165
------------------------------- --- ------- ------- -------
Total equity 89,775 80,733 89,119
------------------------------- --- ------- ------- -------
Approved by the Board of Directors and authorised for issue on
20 April 2018 and signed on its behalf by:
Andrew Jacobs Ray Davies
Chief Executive Officer Finance Director
Consolidated Statement of Cash Flows
For the six months ended 31 January 2018
Six months Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
Notes GBP'000 GBP'000 GBP'000
--------------------------------------------- ------ ------------ ------------ -----------
Operating activities
Cash generated from operations 21a 3,756 2,897 5,523
Income tax paid (375) - (502)
Net cash from operating activities 3,381 2,897 5,021
Investing activities
Development loan capital repaid /(invested) 3,463 (160) (304)
Purchase of property, plant and equipment 9 (10,879) (2,770) (6,628)
Interest received 68 18 25
--------------------------------------------- ------ ------------ ------------ -----------
Net cash used in investing activities (7,348) (2,912) (6,907)
--------------------------------------------- ------ ------------ ------------ -----------
Financing activities
Loans repaid from projects under management
contracts - 944 944
Finance costs paid (280) (315) (574)
Equity dividends paid (2,016) (1,778) (2,637)
Proceeds from issuance of ordinary
shares (net) 236 148 313
Proceeds from sale of treasury shares
(net) - 7,821 9,891
--------------------------------------------- ------ ------------ ------------ -----------
Net cash (used in) / from financing
activities (2,060) 6,820 7,937
Net (decrease) / increase in cash
and cash equivalents in the period (6,027) 6,805 6,051
Cash and cash equivalents at beginning
of the period 11,386 5,335 5,335
--------------------------------------------- ------ ------------ ------------ -----------
Cash and cash equivalents at end of
the period 5,359 12,140 11,386
--------------------------------------------- ------ ------------ ------------ -----------
Accounting Policies
General Information
Lok'nStore Group plc is an AIM listed company incorporated and
domiciled in England and Wales. 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.
Basis of preparation
The interim results for the six months ended 31 January 2018
have been prepared on the basis of the accounting policies expected
to be used in the 2018 Lok'nStore Group Plc Annual Report and
Accounts and in accordance with the recognition and measurement
principles of International Financial Reporting Standards as
adopted by the European Union ('EU') ('IFRS').
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.
The interim results, which were approved by the Directors on 20
April 2018, 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 2017 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.
Going concern
The Directors can report that, based on the Group's budgets and
financial projections, they have satisfied themselves that the
business is a going concern. 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 GBP5.4
million (31.01.2017: GBP12.1 million), undrawn committed bank
facilities at 31 January 2018 of GBP11.2 million (31.01.2017:
GBP11.2 million), and cash generated from operations in the period
to 31 January 2018 of GBP3.76 million (31.01.2017: GBP2.90
million). The Group operates a GBP40 million five year revolving
credit facility with Royal Bank of Scotland plc which provides
funding for site acquisitions and working capital and which was
increased to GBP50 million after the period end in February 2018.
The Group is fully compliant with all bank covenants and
undertakings and is not obliged to make any repayments prior to
expiration. The Group had reported in its July year-end financial
statements that it had agreed a two year extension on its existing
banking facility with Royal Bank of Scotland plc and the facility
which was due to expire in January 2021, will now run until January
2023. The financial statements are therefore prepared on a going
concern basis.
Adjusted EBITDA
Adjusted earnings before interest, tax, depreciation and
amortisation (Adjusted EBITDA) is defined as profits from
operations before all depreciation and amortisation charges,
share-based payments and other non-recurring costs, finance income,
finance costs and taxation.
Store adjusted EBITDA
Store adjusted EBITDA is defined as adjusted EBITDA (see above)
but before central and head office costs.
Notes to the Financial Statements
For the six months ended 31 January 2018
1 Revenue
Analysis of the Group's revenue is shown below:
Six months Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
Stores trading GBP'000 GBP'000 GBP'000
----------------------------------------- --------------------------- --------------------- ----------
Self-storage revenue 6,532 6,225 12,343
Other storage related revenue 787 778 1,550
Ancillary store rental revenue - - 14
Sub-total - Self-storage revenue
- owned stores 7,319 7,003 13,907
Management fees - managed stores 312 181 420
----------------------------------------- --------------------------- --------------------- ----------
Sub-total 7,631 7,184 14,327
Stores under development
Non-storage income 7 8 -
----------------------------------------- --------------------------- --------------------- ----------
Sub-total 7,638 7,192 14,327
----------------------------------------- --------------------------- --------------------- ----------
Serviced archive and records management
revenue 1,181 1,151 2,327
----------------------------------------- --------------------------- --------------------- ----------
Total revenue per statement of
comprehensive income 8,819 8,343 16,654
----------------------------------------- --------------------------- --------------------- ----------
The segment information for the period ended 31 January 2018 and
2017 is as follows:
Serviced Serviced
2017/2018 - Unaudited archive archive
and and
records records
Self-storage management Total Self-storage management Total
six months six months six months six months six months six months
ended ended ended ended ended ended
31 January 31 January 31 January 31 January 31 January 31 January
2018 2018 2018 2017 2017 2017
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- ------------- ----------- ----------- ------------- ----------- ---------------------
Revenue from external
customers 7,638 1,181 8,819 7,192 1,151 8,343
----------------------------- ------------- ----------- ----------- ------------- ----------- -----------------
Segment adjusted EBITDA 3,495 357 3,852 3,064 249 3,313
Depreciation (912) (50) (962) (848) (49) (897)
Amortisation of intangible
assets - (83) (83) - (83) (83)
Equity settled share
based payments (17) - (17) (48) - (48)
Store relocation costs - - - (21) - (21)
Costs of disposal - - - (14) - (14)
Segment profit 2,566 224 2,790 2,133 117 2,250
----------------------------- ------------- ----------- ----------- ------------- ----------- -----------------
Central costs not allocated
to segments:
Finance income 71 174
Finance costs (314) (325)
----------------------------- ------------- ----------- ----------- ------------- ----------- -----------------
Profit before taxation 2,547 2,099
Income tax expense (621) (229)
Consolidated profit
for the financial period 1,926 1,870
----------------------------- ------------- ----------- ----------- ------------- ----------- -----------------
Serviced
2017 - Audited archive &
Self-storage records management Total
year year year
ended ended ended
31 July 31 July 31 July
2017 2017 2017
GBP'000 GBP'000 GBP'000
----------------------------- ------------- -------------------- ----------
Revenue from external
customers 14,327 2,327 16,654
----------------------------- ------------- -------------------- ----------
Segment adjusted EBITDA 5,933 560 6,493
Management charges 25 (25) -
----------------------------- ------------- -------------------- ----------
Segment adjusted EBITDA 5,958 535 6,493
Depreciation (1,760) (96) (1,856)
Amortisation of intangible
assets - (165) (165)
Equity settled share based
payments (97) - (97)
Store relocation costs (29) - (29)
Property disposal costs - (15) (15)
Director retirement costs (69) - (69)
Segment profit 4,003 259 4,262
----------------------------- ------------- -------------------- ----------
Central costs not allocated
to segments:
Finance income 309
Finance costs (606)
----------------------------- ------------- -------------------- ----------
Profit before taxation 3,965
Income tax expense (904)
Consolidated profit for
the financial year 3,061
----------------------------- ------------- -------------------- ----------
2018 Serviced
Unaudited Serviced archive archive
& records & records
Self-storage management Total Self-storage management Total
31 January 31 January 31 January 31 January 31 January 31 January
2018 2018 2018 2017 2017 2017
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- ------------- ----------------- ------------ ------------- ------------ ------------
Segment assets 134,660 5,917 140,577 122,935 6,100 129,035
--------------------- ------------- ----------------- ------------ ------------- ------------ ------------
Segment liabilities (21,512) (606) (22,118) (19,067) (498) (19,565)
Borrowings (28,684) (28,737)
--------------------- ------------- ----------------- ------------ ------------- ------------ ------------
Total liabilities (50,802) (48,302)
Capital expenditure 10,863 16 10,879 2,768 2 2,770
--------------------- ------------- ----------------- ------------ ------------- ------------ ------------
2017 Serviced archive
Audited Self-storage & records Total
31 July management 31 July
2017 31 July 2017 2017
GBP'000 GBP'000 GBP'000
--------------------- ------------- ----------------- ---------
Segment assets 133,457 6,190 139,647
--------------------- ------------- ----------------- ---------
Segment liabilities (21,189) (669) (21,858)
Borrowings (28,670)
--------------------- ------------- ----------------- ---------
Total liabilities (50,528)
--------------------- ------------- ----------------- ---------
Capital expenditure 6,459 169 6,628
--------------------- ------------- ----------------- ---------
2a Property, staff, distribution, Six months Six months Year
general costs and retail cost of ended ended ended
sales 31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------- ------------------------ -------------- ---------
Property and premises costs 1,974 2,087 4,179
Staff costs 2,194 2,156 4,389
General overheads 552 542 1,098
Distribution costs 81 83 171
----------------------------------- ------------------------ -------------- ---------
Subtotal - operating costs 4,801 4,868 9,837
----------------------------------- ------------------------ -------------- ---------
Retail products cost of sales 166 162 324
----------------------------------- ------------------------ -------------- ---------
4,967 5,030 10,161
----------------------------------- ------------------------ -------------- ---------
2b 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 Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------------- ------------ ------------ ---------
Retail 56 67 128
Insurance 20 20 37
Other 5 2 2
---------------------------------- ------------ ------------ ---------
81 89 167
Serviced archive consumables and
direct costs 85 73 157
---------------------------------- ------------ ------------ ---------
166 162 324
---------------------------------- ------------ ------------ ---------
2c Other Income and costs
Six months Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
--------------------------- ------------- ------------ ---------
Property disposal costs - 14 15
Director retirement costs - - 69
Store relocation costs - 21 29
--------------------------- ------------- ------------ ---------
- 35 113
----------------------------------------- ------------ ---------
3 Finance income
Six months Six months
ended ended Year ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------- ------------ ------------ -----------
Bank interest 5 18 25
Other interest 66 156 284
---------------- ------------ ------------ -----------
71 174 309
---------------- ------------ ------------ -----------
4 Finance costs
Six months Six months
ended ended 31 Year ended
31 January January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
--------------------------------------- ------------ ----------- -----------
Bank interest 269 283 520
Non-utilisation fees and amortisation
of bank loan arrangement fees 45 42 86
314 325 606
--------------------------------------- ------------ ----------- -----------
Most interest payable arises on bank loans classified as
financial liabilities measured at amortised cost.
5 Profit before taxation
Six months ended Six months Year ended
31 January ended 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP '000
--------------------------------------------- ----------------- ------------------ -----------
Profit before taxation is stated
after charging:
Depreciation of plant, property and
equipment
- owned assets 962 897 1,856
Amortisation of intangible
assets 83 83 165
Operating lease rentals - land
and buildings 719 764 1,488
--------------------------------------------- ----------------- ------------------ -----------
6 Taxation
Six months ended Six months Year
31 January ended 31 January ended 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Current tax:
UK corporation tax 486 424 792
---------------------------------------- ----------------- ------------------ ---------------
Deferred tax:
Origination and reversal of temporary
differences 135 71 204
Adjustments in respect of prior
periods - - 173
Impact of change in tax rate
on closing balance - (266) (265)
---------------------------------------- ----------------- ------------------ ---------------
Total deferred tax charge 135 (195) 112
---------------------------------------- ----------------- ------------------ ---------------
Income tax expense for the period/year 621 229 904
---------------------------------------- ----------------- ------------------ ---------------
The charge for the period can be reconciled to the profit for
the period as follows:
Year
Six months ended Six months ended 31
31 January ended 31 January July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
Profit before tax 2,547 2,099 3,695
Tax on ordinary activities at
the standard effective rate of
corporation tax in the UK of 20%
(31.1.2017: 20.0%) 509 420 793
Expenses not deductible for tax
purposes 2 2 2
Depreciation of non-qualifying
assets 144 50 104
Share based payment charges in
excess of corresponding tax deduction 3 10 19
Adjustments in respect of prior
periods - deferred tax - - 173
Impact of change in tax rate on
closing DT balance - (266) (265)
Share option scheme - 12 5
Other timing differences (37) - 71
---------------------------------------- ----------------- ------------------ -------------
Income tax expense for the period/year 621 229 904
---------------------------------------- ----------------- ------------------ ----------
Effective tax rate 24.4% 10.9% 23%
---------------------------------------- ----------------- ------------------ ----------
In addition to the amount charged to profit or loss for the
period, deferred tax relating to the revaluation of the Group's
properties of GBP118,872 (31.1.2017: GBP498,983) has been
recognised directly in other comprehensive income (see note 16 on
deferred tax).
7 Dividends
Six months Six months
ended ended 31 Year ended
31 January January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------------------- ------------ ----------- -------------
Amounts recognised as distributions to equity
holders in the year:
----------------------------------------------- ------------ ----------- -------------
Final dividend for the year ended 31 July
2016 (6.33 pence per share) - 1,778 1,778
Interim dividend for the six months to 31
January 2017 (3 pence per share) - - 859
Final dividend for the year ended 31 July 2,016 - -
2017 (7 pence per share)
2,016 1,778 2,637
----------------------------------------------- ------------ ----------- -------------
In respect of the current period the Directors propose that an
interim dividend of 3.33 pence per share will be paid to the
shareholders. The total estimated dividend to be paid is GBP983,956
based on the number of shares currently in issue as adjusted for
shares held in the Employee Benefits Trust. This interim dividend
is an on-account payment of a final annual dividend and is
ultimately subject to approval by shareholders at the 2018 Annual
General Meeting and has not been included as a liability in these
financial statements. The ex-dividend date will be 3 May 2018; the
record date 4 May 2018; with an intended payment date of 15 June
2018. The final deadline for Dividend Reinvestment Election is 21
May 2018.
8 Earnings per share
The calculations of earnings per share are based on the
following profits and numbers of shares.
Six months Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
----------------------------------- ---------------- ------------ -----------
Profit for the financial period 1,926 1,870 3,061
----------------------------------- ---------------- ------------ -----------
No. of No. of
No. of shares shares shares
----------------------------------- ---------------- ------------ -----------
Weighted average number of shares
For basic earnings per share 28,746,236 27,071,818 27,780,676
Dilutive effect of share options 526,509 651,347 999,657
----------------------------------- ---------------- ------------ -----------
For diluted earnings per share 29,272,745 27,723,165 28,780,333
----------------------------------- ---------------- ------------ -----------
623,212 shares (31.01.2017: 623,212) are held in the Employee
Benefit Trust and nil (31.01.2017: 491,869) shares are held in
Treasury. Both are excluded from the above calculation.
Six months Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
-------------------- ------------ ------------ ---------
Earnings per share
Basic 6.70p 6.91p 11.02p
-------------------- ------------ ------------ ---------
Diluted 6.58p 6.74p 10.64p
-------------------- ------------ ------------ ---------
9 Property, plant and equipment
Fixtures,
Development Long leasehold Short fittings
property Land and land and leasehold and Motor
assets buildings buildings improvements equipment vehicles
at cost at valuation at valuation at cost at cost at cost Total
Group GBP'000 GBP '000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
Net book
value
at 31 July
2016
- Audited 458 80,953 9,263 782 12,902 5 104,363
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
Net book
value
at 31
January 2017
- Unaudited 2,792 80,865 9,314 769 12,884 4 106,628
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
Net book
value
at 31 July
2017
- Audited 5,124 87,548 10,293 719 13,213 4 116,901
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
Cost or
valuation
1 August 2017 5,124 87,548 10,293 2,599 23,984 17 129,565
Additions 10,756 105 - 18 - - 10,879
Revaluations - 145 49 - - - 194
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
31 January
2018
Unaudited 15,880 87,798 10,342 2,617 23,984 17 140,638
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
Depreciation
1 August 2017 - - - 1,880 10,771 13 12,664
Depreciation - 372 63 49 478 - 962
Revaluations (372) (63) - - - (435)
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
31 January
2018
Unaudited - - - 1,929 11,249 13 13,191
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
Net book
value
at 31
January
2018
- Unaudited 15,880 87,798 10,342 688 12,735 4 127,447
-------------- ------------ -------------- --------------- ------------- ----------- ------------- ----------
Capital expenditure during the period totalled GBP10.9 million
(31.1.2017: GBP2.8 million). This was primarily the purchase and
subsequent construction works at our development sites in
Gillingham and Wellingborough as well as completing fitting-out
works at our Bristol store.
Property, plant and equipment (non-current assets) with a
carrying value of GBP127.4 million (31.1.2017: GBP106.6 million)
are pledged as security for bank loans (see note 15a).
Market Valuation of Freehold and Operating Leasehold Land and
Buildings
Following the comprehensive external valuation at 31 July 2017
by JLL, the freehold and leasehold properties have not been
externally valued at 31 January 2018, although in accordance with
the Group's established policy it is the intention to do so at the
next year end at 31 July 2018.
Although the Board did not commission an external valuation at
this interim period-end it is mindful of the need to accord with
the measurement principles of International Financial Reporting
Standards as adopted by the European Union. Accordingly after
consulting with our external valuers, whilst there has been
continued market activity in the self storage sector since July
2017, the Directors considered that there had not been such a
material movement in market yields that warranted a modification to
the position as at 31 January 2018 in respect of our properties
externally valued at 31 July 2017. The Directors therefore consider
that it is appropriate to maintain the portfolio's external
valuation without modification pending a comprehensive external
valuation at our 31 July 2018 year-end.
10 Development loan capital
In May 2015 Lok'nStore opened a new store in Aldershot,
Hampshire on behalf of outside investors, to which it provided
development loan capital. The store is managed under the Lok'nStore
brand. The Group has managed the building and subsequent operation
of the store and has generated a return on GBP2.5 million of the
total development capital committed to the project, as well as
management fees for the construction, operation and branding of the
store. On 31 October 2017 the entire development loan was repaid to
Lok'nStore together with all accrued interest. Lok'nStore continues
to manage the operation of the store.
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
-------------------------- ------------ ----------- ---------
Development loan capital - 3,319 3,463
-------------------------- ------------ ----------- ---------
11 Inventories
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
---------------------------------- ----------- ----------- ---------
Consumables and goods for resale 236 168 203
---------------------------------- ----------- ----------- ---------
The amount of inventories recognised as an expense during the
period was GBP77,039 (31.1.2017: GBP81,005).
12 Trade and other receivables
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
-------------------------------- ----------- ----------- ---------
Trade receivables 2,098 1,414 1,693
Other receivables 1,473 857 1,822
Prepayments and accrued income 621 1,000 751
4,192 3,271 4,266
-------------------------------- ----------- ----------- ---------
The Directors consider that the carrying amount of trade and
other receivables and accrued income approximates their fair
value.
13 Trade and other payables
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------ ----------- ----------- ---------
Trade payables 960 593 818
Taxation and social security costs 496 666 288
Other payables 1,221 1,156 1,692
Accruals and deferred income 2,235 2,107 2,234
------------------------------------ ----------- ----------- ---------
4,912 4,522 5,032
------------------------------------ ----------- ----------- ---------
The Directors consider that the carrying amount of trade and
other payables and accruals approximates fair value.
14 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 gearing ratio at the period-end is as follows:
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
--------------------------- ----------- ----------- ---------
Gross debt (28,816) (28,816) (28,816)
Cash and cash equivalents 5,359 12,140 11,386
--------------------------- ----------- ----------- ---------
Net debt (23,457) (16,676) (17,430)
Total equity 89,775 80,733 89,119
Net debt to equity ratio 26.1% 20.7% 19.6%
--------------------------- ----------- ----------- ---------
15a Borrowings
31 January 31 January 31 July
2018 Unaudited 2017 Unaudited 2017
GBP'000 GBP'000 Audited
GBP'000
--------------------------------------- ---------------- ---------------- ---------
Non-current
Bank loans repayable in more than two
years
but not more than five years
Gross 28,816 28,816 28,816
Deferred financing costs (132) (79) (146)
--------------------------------------- ---------------- ---------------- ---------
Net bank borrowings 28,684 28,737 28,670
--------------------------------------- ---------------- ---------------- ---------
The GBP40 million five year revolving credit facility which was
executed in January 2016 with Royal Bank of Scotland plc. included
a two year extension option which means it will now run until
January 2023.
The GBP40 million five year revolving credit facility set the
interest rate margin at the London Inter-Bank Offer Rate (LIBOR)
plus 1.40%-1.65% based on a loan to value covenant test. This rate
is 1.40% currently and the all in debt cost on GBP28.8 million
drawn averaged 1.7% in the last five months.
The revolving credit facility is secured by legal charges and
debentures over the freehold and leasehold properties and other
assets of the business with a net book value of GBP127.4 million
together with cross-company guarantees from Group companies. The
Group is not obliged to make any repayments prior to
expiration.
(Post Balance Sheet) In February 2018, after the period-end, the
Group executed its GBP10 million accordion increasing its existing
GBP40 million Banking Facility to GBP50 million. The increased
facility will provide funding for site acquisitions and working
capital to support the Group's ambitious growth plans for more
landmark site acquisitions and working capital.
16 Deferred tax
31 January 31 January 31 July 2017
2018 2017 Audited
Unaudited Unaudited GBP'000
Deferred tax liability GBP'000 GBP'000
-------------------------------------- ----------- ----------- -------------
Liability at start of period/year 16,363 15,361 15,361
Charge to income for the period/year 135 (195) 112
Tax charged directly to other
comprehensive income 119 (499) 932
Credit to share based payment
reserve 16 (221) (42)
Liability at end of period/year 16,633 14,446 16,363
-------------------------------------- ----------- ----------- -------------
The following are the major deferred tax liabilities and assets
recognised by the Group and the movements during the year:
Rolled
over
Accelerated Other Revaluation gain
Capital Tax Intangible temporary of on Share
Allowances losses assets differences properties disposal Options Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------- ---------------- -------- ----------- ------------ ------------ --------- -------- ------------
At 31 July 2016
-
Audited 1,855 - 447 24 10,961 2,323 (249) 15,361
Charge/
(credit) to
income for the
period (34) - (39) (8) - (141) 27 (195)
Charge to other
comprehensive
income - - - - (511) 12 - (499)
---------------- ---------------- -------- ----------- ------------ ------------ --------- -------- ------------
Charge to share
based payment
reserve - - - - - - (221) (221)
---------------- ------------ -------- ----------- ------------ ------------ ---------
At 31 January
2017
- Unaudited 1,821 - 408 16 10,450 2,194 (443) 14,446
---------------- ---------------- -------- ----------- ------------ ------------ --------- -------- ------------
Charge/
(credit) to
income for the
period 375 - (14) 1 - (48) (7) 307
Charge to other
comprehensive
income - - - - 1,431 - - 1,431
---------------- ---------------- -------- ----------- ------------ ------------ --------- -------- ------------
Charge to share
based payment
reserve - - - - - - 179 179
---------------- ------------ -------- ----------- ------------ ------------ ---------
At 31 July 2017
-
Audited 2,196 - 394 17 11,881 2,146 (271) 16,363
---------------- ---------------- -------- ----------- ------------ ------------ --------- -------- ------------
Charge/
(credit) to
income for the
period 161 - (14) - - (12) - 135
Charge to other
comprehensive
income - - - - 107 12 - 119
---------------- ---------------- -------- ----------- ------------ ------------ --------- -------- ------------
Charge to share
based payment
reserve - - - - - - 16 16
---------------- ------------ -------- ----------- ------------ ------------ ---------
At 31 January
2018
- Unaudited 2,357 - 380 17 11,988 2,146 (255) 16,633
---------------- ---------------- -------- ----------- ------------ ------------ --------- -------- ------------
17 Share capital
31 January 31 January 2017 31 July 2017
2018 Unaudited Audited
Unaudited GBP'000 GBP'000
GBP'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 29,302,923 29,109,322 29,109,322
-------------------------------------- ------------- ---------------- -------------
Options exercised during period/year 127,000 89,908 193,601
-------------------------------------- ------------- ---------------- -------------
Balance at end of period/year 29,429,923 29,199,230 29,302,923
-------------------------------------- ------------- ---------------- -------------
Allotted, issued and fully paid GBP GBP GBP
ordinary shares
-------------------------------------- ------------- ---------------- -------------
Balance at start of period/year 293,029 291,093 291,093
Options exercised during period/year 1,270 899 1,936
-------------------------------------- ------------- ---------------- -------------
Balance at end of period/year 294,299 291,992 293,029
-------------------------------------- ------------- ---------------- -------------
The Company has one class of ordinary shares which carry no
right to fixed income.
18 Other reserves
Share-based
Cash flow Other Capital
hedge Merger reserve redemption payment
reserve reserve reserve reserve Total
Group GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------- ------------ -------- -------- ----------- ------------ --------
1 August 2016 - Audited (37) 6,295 1,294 34 846 8,432
------------------------------- ------------ -------- -------- ----------- ------------ --------
Equity share based payments - - - - 48 48
Transfer to retained
earnings in relation
to share based payments - - - - (66) (66)
Cash flow hedge reserve
net of tax 37 - - - - 37
Tax credit relating to
share options - - - - 221 221
------------------------------- ------------ -------- -------- ----------- ------------ --------
31 January 2017 - Unaudited - 6,295 1,294 34 1,049 8,672
------------------------------- ------------ -------- -------- ----------- ------------ --------
Equity share based payments - - - - 49 49
Transfer to retained
earnings in relation
to share based payments - - - - (73) (73)
Tax credit relating to
share options (179) (179)
------------------------------- ------------ -------- -------- ----------- ------------ --------
31 July 2017 - Audited - 6,295 1,294 34 846 8,469
------------------------------- ------------ -------- -------- ----------- ------------ --------
Equity share based payments - - - - 17 17
Transfer to retained
earnings in relation
to share based payments - - - - (80) (80)
Tax credit relating to
share options - - - - (16) (16)
------------------------------- ------------ -------- -------- ----------- ------------ --------
31 January 2018 - Unaudited - 6,295 1,294 34 767 8,390
------------------------------- ------------ -------- -------- ----------- ------------ --------
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. 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 IFRS2 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. The total amounts calculated
and accordingly transferred to retained earnings in the period
amounted to GBP79,666 (31.1.2017: GBP65,570).
19 Retained earnings Retained
earnings Retained
before
deduction Own shares earnings
of
own shares (note 20) Total
Group GBP'000 GBP'000 GBP'000
----------------------------------- ----------- ----------- -----------
1 August 2016 - Audited 17,824 (4,241) 13,583
------------------------------------- ----------- ----------- -----------
Profit for the financial period 1,870 - 1,870
Transfer from revaluation reserve 115 - 115
Transfer from share based payment
reserve (Note 18) 66 - 66
Dividend paid (1,778) - (1,778)
Sale of treasury shares - 3,117 3,117
------------------------------------- ----------- ----------- -----------
31 January 2017 - Unaudited 18,097 (1,124) 16,973
------------------------------------- ----------- ----------- -----------
Profit for the financial period 1,191 - 1,191
Transfer from revaluation reserve 162 - 162
Transfer from share based payment
reserve (Note 18) 73 - 73
Sale of treasury shares - 624 624
Dividend paid (859) - (859)
Transfer realised gain on asset - - -
disposal
----------------------------------- ----------- ----------- -----------
31 July 2017 - Audited 18,664 (500) 18,164
------------------------------------- ----------- ----------- -----------
Profit for the financial period 1,926 - 1,926
Transfer from revaluation reserve 148 - 148
Transfer from share based payment
reserve (Note 18) 80 - 80
Dividend paid (2,016) - (2,016)
31 January 2018 - Unaudited 18,802 (500) 18,302
------------------------------------- ----------- ----------- -----------
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.
20 Own shares
ESOP ESOP Treasury Treasury Own shares
shares shares shares shares total
Number GBP Number GBP GBP
------------------- -------- -------- ---------- ---------- -----------
1 August
2016- Audited 623,212 499,910 2,466,869 3,741,036 4,240,946
31 January
2017 - Unaudited 623,212 499,910 491,869 624,247 1,124,157
31 July 2017-
Audited 623,212 499,910 - - 499,910
------------------- -------- -------- ---------- ---------- -----------
31 January
2018 - Unaudited 623,212 499,910 - - 499,910
------------------- -------- -------- ---------- ---------- -----------
Following the disposal on 26 April 2017 in the previous period
of the remaining shares held in Treasury, and with no purchases
made during the current period, Lok'nStore Limited no longer holds
any shares in Treasury at the period-end (31.1.2017: 491,869).
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 2018, the Trust held 623,212
(31.01.2017: 623,212) ordinary shares of 1 pence each with a market
value of GBP2,461,687 (31.01.2017: GBP2,835,615). No shares were
transferred out of the scheme during the period (2017: nil).. No
options have been granted under the EBT.
21 Cash flows
(a) Reconciliation of profit before tax to cash generated from
operations
Six months Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
------------------------------------ ------------ ------------ ---------
Profit before tax 2,547 2,099 3,965
Depreciation 962 897 1,856
Amortisation of intangible
assets 83 83 165
Equity settled share based
payments 17 48 97
Store relocation costs and
site disposal costs - 35 44
Interest receivable (71) (174) (309)
Interest payable 314 325 606
(Increase) in inventories (33) (3) (38)
Decrease/(increase) in receivables 74 736 (284)
(Decrease) in payables (137) (1,149) (648)
-------------------------------------- ------------ ------------ ---------
Cash generated from operations 3,756 2,897 5,523
-------------------------------------- ------------ ------------ ---------
(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 15a less cash and cash equivalents.
Six months Six months Year
ended ended ended
31 January 31 January 31 July
2018 2017 2017
Unaudited Unaudited Audited
GBP'000 GBP'000 GBP'000
(Decrease) / Increase in cash
in the period/year (6,027) 6,805 6,051
Change in net debt resulting - - -
from cash flows
--------------------------------- ------------ ------------ ---------
Movement in net debt in period (6,027) 6,805 6,051
Net debt brought forward (17,430) (23,481) (23,481)
----------------------------------- ------------ ------------ ---------
Net debt carried forward (23,457) (16,676) (17,430)
----------------------------------- ------------ ------------ ---------
22 Events after the Reporting Date
i) Lok'nStore increases its existing GBP40 million Banking Facility to GBP50 million
In February 2018, after the period-end the Group executed its
GBP10 million accordion. The increased facility will provide
funding for site acquisitions and working capital to support the
Group's ambitious growth plans for more landmark site acquisitions
and working capital.
ii) Wellingborough Store
The store opened on 23 March 2018.
iii) Gloucester
On 2 March 2018 the Gloucester site was secured as a Managed
Store.
iv) Leicester
Acquisition on 14 February 2018 of a freehold site for a new
landmark store (subject to planning).
The 1 acre site is in a highly prominent location opposite a
major food retailer in the heart of Leicester's busy retail
district. The total investment of circa GBP8.5 million will be
funded from cash flow and existing banking facilities. When
developed, this store will add around 60,000 sq. ft. of trading
space.
v) Fareham Store (Leasehold)
On 22 February 2018, the Group completed the Deed of Variation,
Reversionary Lease and Rent Review Memorandum extending the lease
term by ten years to 2036.
Our Stores/Sites
Head office
Lok'nStore plc
112 Hawley Lane
Farnborough
Hampshire GU14 8JE
Tel 01252 521010
www.loknstore.co.uk
Owned Trading Stores
Basingstoke, Hampshire Horsham, West Sussex Poole, Dorset Bristol, Gloucestershire
Crockford Lane Blatchford Road 50 Willis Way Longwell Green
Chineham Redkiln Estate Fleetsbridge Trade Park
Basingstoke Horsham Poole Aldermoor Way
Hampshire RG24 West Sussex RH13 Dorset BH15 3SY Bristol
8NA 5QR Tel 01202 666160 BS30 7ET
Tel 01256 474700 Tel 01403 272001 poole@loknstore.co.uk Tel 0117 967
basingstoke@loknstore.co.uk horsham@loknstore.co.uk 7055
bristol@loknstore.co.uk
Crayford, Kent Luton, Bedfordshire Portsmouth, Hampshire Gillingham, Kent
Block B 27 Brunswick Street Rudmore Square Courtney Road
Optima Park Luton Portsmouth PO2 Gillingham
Thames Road Bedfordshire LU2 8RT Kent ME8 0RT
Crayford 0HG Tel 02392 876783 Tel 01634 366044
Kent DA1 4QX Tel 01582 721177 portsmouth@loknstore.co.uk gillingham@loknstore.co.uk
Tel 01322 525292 luton@loknstore.co.uk
crayford@loknstore.co.uk
---------------------------- ---------------------------- ----------------------------
Eastbourne, East Maidenhead, Berkshire Reading, Berkshire Tonbridge, Kent
Sussex Stafferton Way 251 A33 Relief Unit 6 Deacon
Unit 4, Hawthorn Maidenhead Road Trading Estate
Road Berkshire Reading Vale Road
Eastbourne SL6 1AY RG2 0RR Tonbridge
East Sussex BN23 Tel 01628 878870 Tel 01189 588999 Kent TN9 1SW
6QA maidenhead@loknstore.co.uk reading@loknstore.co.uk Tel 01732 771007
Tel 01323 749222 tonbridge@loknstore.co.uk
eastbourne@loknstore.co.uk
---------------------------- ---------------------------- ----------------------------
Fareham, Hampshire Milton Keynes, Southampton, Hampshire Harlow, Essex
26 + 27 Standard Buckinghamshire Manor House Avenue Edinburgh Way
Way Etheridge Avenue Millbrook Temple Fields
Fareham Industrial Brinklow Southampton Harlow
Park Milton Keynes Hampshire SO15 Essex CM20 2GF
Fareham Buckinghamshire 0LF Tel 01279 882366
Hampshire PO16 MK10 0BB Tel 02380 783388 harlow@loknstore.co.uk
8XJ Tel 01908 281900 southampton@loknstore.co.uk
Tel 01329 283300 miltonkeynes@loknstore.co.u
fareham@loknstore.co.uk k
---------------------------- ---------------------------- ----------------------------
Farnborough, Hampshire Northampton Central Northampton Riverside Sunbury, Middlesex
112 Hawley Lane 16 Quorn Way Units 1-4 Unit C
Farnborough Grafton Street Carousel Way The Sunbury Centre
Hampshire GU14 Industrial Estate Northampton Hanworth Road
8JE Northampton NN1 Northamptonshire Sunbury on Thames
Tel 01252 511112 2PN NN3 9HG Middlesex TW16
farnborough@loknstore.co.uk Tel 01604 629928 Tel 01604 785522 5DA
nncentral@loknstore.co.uk northampton@loknstore.co.uk sunbury@loknstore.co.uk
---------------------------- ---------------------------- ----------------------------
Southampton, Hampshire ParknCruise
Third Avenue Manor House Avenue
Southampton Millbrook, Southampton
Hampshire SO15 Hampshire SO15
0JX 0LF
Tel 02380 783388 Tel 02380 789966
southampton@loknstore.co.uk southampton@parkncruise.co.
uk
---------------------------- ---------------------------- ----------------------------
Development locations - LNS Owned Stores
Wellingborough, Bedford Bournemouth Leicester
19/21 Whitworth 69 Cardington Land at Wessex Part of land forming
Way Road, Bedford. Field, Deansleigh part of Freemens
Wellingborough NK42 0BQ Road, Bournemouth Common Road, Leicester
NN8 2EF BH7 7DU LE2 7SL
Managed stores - Trading
Aldershot, Hampshire Chichester, West Woking Broadstairs
251, Ash Road Sussex Marlborough Road Unit 2, Pyramid
Aldershot 17, Terminus Woking Business Park,
GU12 4DD Road GU21 5JG Poorhole Lane,
Tel 0845 4856415 Chichester Tel 01483 378323 Broadstairs,
aldershot@loknstore.co.uk West Sussex woking@loknstore.co.uk Kent CT10 2PT
PO19 8TX
chichester@loknstore.co.uk
Ashford, Kent Crawley, West Swindon Kembrey Hemel Hempstead
Wotton Road Sussex Park Fortius Point,
Ashford Sussex Manor Kembrey Street 47, Maylands Avenue,
Kent TN23 6LL Business Park Elgin Industrial Hemel Hempstead,
Tel 01233 645500 Gatwick Road Estate Hertfordshire HP2
Fax 01233 646000 Crawley Swindon 7DE
ashford@loknstore.co.uk RH10 9NH Wiltshire SN2
Tel 01293 738530 8UY
crawley@loknstore.co.uk Tel 01793 421234
swindoneast@loknstore.co.uk
Managed stores - Under Development
Dover, Kent Exeter Ipswich,
Honeywood Parkway, Land on the West Part of Site 7,
Whitfield, Side of Matford Futura Park, Ipswich
Dover, CT16 3FJ Park Road, Marsh IP3 9QH
Barton, Exeter
Devon
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR FKKDQQBKDOQB
(END) Dow Jones Newswires
April 23, 2018 02:00 ET (06:00 GMT)
Lok'n Store (LSE:LOK)
Historical Stock Chart
From Mar 2024 to Apr 2024
Lok'n Store (LSE:LOK)
Historical Stock Chart
From Apr 2023 to Apr 2024