Storage firm Big Yellow sees revenue creep up despite lockdown
Self storage firm Big Yellow said that revenues crept up 2.3 per cent in the first quarter despite a fall in demand due to the coronavirus pandemic.
Revenue increased to £31.8m in the three months ending in June, up from £31.1m in the same period last year.
Shares in the FTSE 250 firm rose one per cent on the back of the announcement.
Since mid-May, the firm, which provides rentable storage spaces, said that it had seen a rise in demand from both business and individual customers as lockdown restrictions were eased.
Although total activity in June was down 15 per cent year-on-year, business client activity – move-ins and move-outs – rose 28 per cent compared to the year before.
Big Yellow said the increase in business demand following the gradual reopening of the economy is being driven by online retailers and business-to-business traders looking for flexible mini-warehousing and the shortening of supply chains.
It added that the reopening of the housing market had led to an improvement in all aspects of short stay and longer stay domestic demand, which had continued into the current quarter.
Student activity was distorted by a spike in emergency move-ins in March as the lockdown was announced, whilst others were allowed to leave their belongings in their accommodation over the summer term.
In total, occupancy grew 10.4 per cent during the three-month period, with 138,000 square feet of occupancy added.
As a result of the virus, construction at Big Yellow’s 57,000 square foot store in Bracknell and 71,000 square foot store in Battersea, London has been delayed.
However, the firm said it had returned to both, and expected the stores to open in September 2020 and November 2020 respectively.
Chief executive James Gibson said that the early signs from the second quarter showed an improvement in year-on-year occupancy growth.
“Significant economic uncertainty remains, and it should be noted that we have limited visibility in this business, with customers tending to reserve only a few weeks before moving in”, he warned.
“However, we remain confident of the longer-term growth prospects for the business”.