Safestore Holdings PLC on Wednesday said pretax profit dropped by 58% in ‘a resilient year of significant strategic and operational progress’.

The Hertfordshire, England-based self-storage provider said pretax profit fell 58% in the year that ended on October 31, to £207.8 million from £498.8 million the prior year.

Revenue for the year, however, rose 5.5% to £224.2 million from £212.5 million. Underlying earnings before interest, tax, depreciation and amortisation of £142.2 million, up 5.3% from £135.1 million.

Safestore reported a reduced gain on investment properties of £93.8 million, from £381.6 million, which it said combined with Ebitda to deliver operating profit of £230.4 million, down 55% from £514.5 million.

Safestore also declared a 20.2 pence per share final dividend, down from 20.4p the year before. Its total dividend for the year, however, rose to 30.1p from 29.8p.

Meanwhile, Safestore said its strategic progress during financial 2023 included growing its development and extension pipeline to 30 projects, entering the German market through a joint venture, and lease extensions on four UK stores. It also added around 500,000 square feet of new maximum lettable area across thirteen projects.

‘I am pleased that 2023 has been a resilient year of significant strategic and operational progress building on two years of out-performance,’ said Chief Executive Officer Frederic Vecchioli.

He added: ‘Importantly, the underlying fundamentals of the European self storage industry with limited supply, strong barriers to entry and a steadily growing product awareness are as strong as ever.

‘We believe that the Covid period has acted as an accelerator of growth for the still relatively immature self storage industry.’

Going forward, Safestore said it expects its development pipeline to be dilutive to its earnings in the current financial year, ‘before becoming highly accretive in future years as the stores stabilise’.

Safestore also believes it ‘is strongly positioned to withstand pressures from challenging market conditions’ due to its ‘highly resilient’ business model.

Vecchioli commented: ‘Safestore has a proven track record, and as the returns we deliver are significantly ahead of our cost of debt, we look to the future with confidence.’

Shares in Safestore traded 5.4% lower at 804.00p each on Wednesday morning in London.

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