Safestore Holdings PLC on Wednesday reported a sharp drop in interim profit despite a slight rise in revenue, but the company said it was well-positioned to face any inflationary headwinds.

The Hertfordshire, England-based self-storage provider said that for the six months that ended April 30 pretax profit more than halved to £103.4 million from £285.2 million a year prior.

The company said a robust half-year trading performance was offset by a lower gain on investment properties of £47.3 million, down from a gain of £223.9 million a year before.

Safestore’s profit last year was boosted by a £10.5 million addition of exceptional items, with a £5.5 million profit relating to the valuation gain recognised on a 20% equity investment in a joint venture with CERF, which Safestore acquired the remaining 80% of on March 30 last year.

The remaining £5.0 million profit related to a net gain on the disposal of the Nanterrem Paris site in November 2021.

Revenue increased slightly to £110.1 million, up 8.9% from £101.1 million the previous year. The company stated this was due to storage revenue rising to £87.3 million, up 4.3% from £83.7 million the previous year.

Chief Executive Officer Frederic Vecchioli said: ‘Whilst performance in the first half of the year has been very strong we are conscious of the inflationary and cost of living pressures ahead.’

Like-for-like average storage rate for the period rose 6.5% in constant exchange rates. In the UK this was up 6.9%. Like-for-like occupancy fell to 78.3%, down 8.3% from 86.6% the prior year.

Safestore’s property portfolio valuation increased by £128.8 million since October to £2.59 billion. The company said this included £63.1 million of additions and reclassifications.

The company declared an interim dividend of 9.9 pence per share, up 5.3% from 9.4p per share the previous year. Safestore said this reflected the company’s improved underlying profitability.

‘Our business has proved itself to be resilient with multiple drivers of demand and, despite the current macroeconomic challenges, we believe the group, whilst not entirely immune from any cost of living or inflationary issues, is well positioned to withstand any downturn,’ Safestore said.

Safestore shares were down 0.4% at 927.50 pence in London on Wednesday.

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