GAV was up 8.5% lfl in H1 21 sequentially. It suggests an unprecedented level in FY 21. Deriving from the current 32% premium to NAV, Segro was granted a lower than 2.8% yield by the stockmarket. In relative terms, warehouses are now more expensive than the best locations in the heart of best metropolitan areas.
Companies: SEGRO plc
Vacancy increased in Q1 21 (+50bp vs. December 2020, to 4.4%) for “refurbishment purposes”. Segro took back some ground so that it could raise its standard. Renewals signed were 12% above previous rents: this shows an upside vs. the current rents base on top of the installed base being developed.
Yield compression continued as far as the logistics assets are concerned. The GAV was up 10% lfl in FY 20, resulting in a NAV up 16% (sixteen) from 700p to 814p. The low vacancy observed (3.9% in December 2020 vs. 4.0% in December 2019) doesn’t reflect the increasing portion of retailers facing questions about their own businesses, in the UK especially.
Vacancy, rents and reversion were safe in H1 20. Segro is still very positive as far as the short term is concerned. It is pushing its investment strategy but reducing its speculative developments. However, some first negative revaluations were clearly visible in H1 20 (lfl): cracks (but not a krach) in a long favourable inflationist cycle in the Logistics / Warehouses-beloved thematic.
The difference between the current market cap (£10.3bn) and FY 19 NNNAV (£7.4bn) was £2.8bn or a premium of 38%. This is the equivalent of six years of FY 19 accounted positive revaluations of £477m. The latter was c. half of both FY 18 and FY 17 contributions, i.e.e showed a kind of real softening.
The industrial and logistics sector has been on a tremendous run over the past five years or so. It is hard to think now, given the current dynamics in the property industry, that retail and offices were the sectors of choice for investors for many years with industrial cast aside by most.
Companies: ASLI LMP SGRO SMP BBOX EBOX SHED WHR
Segro reported nice H1 19 figures, due to the completion of recent pre-let ground and undergoing low speculative developments. We nevertheless point out the coexistence of Brexit issues and the 25% premium of the share price vs. H1 19’s NNNAV.
The revaluation pace halved in H1 19 vs. H1 18 (in £). Yield compression stopped in the UK and slowed in Continental Europe. The topline itself should slow from H1 20. Our opinion is that the strong premium vs. NNNAV doesn’t reflect the full Brexit risk, despite a very nice set of operational figures.
After raising £450m in February, Segro is now fully ready to achieve a good 2019 fiscal year with above 9% top-line growth (no guidance) thanks to deliveries in the pipeline. Management is still very optimistic concerning its developments as the pipeline continues to grow (+25% from 31 December 2018 to 30 March 2019).
Segro benefits from further yields compression in H2 18. After anticipating this new increase in asset valuations, and being perfectly right, management now mentions lower visibility on the 2019 valuation front.
The group has reported encouraging interim results, showing it is still taking advantage of the European logistics’ good dynamics. It logged a 43% rise in the total contracted headline rent for the nine months to 30 September 2018 from £36.4m (9M 2017) to £52m. New leasing activity in Q3 18 contributed £12.6m, including £4.2m in rent from existing space. The rent on renewals and reviews rose up by 9.5% ytd (vs. 5.5% in FY17). The only negative point was the vacancy rate, which has increased from
Scarce assets become scarcer and turn Segro into an ever more unique property story.
Due to a change in sector focus Cenkos Securities plc has suspended coverage on the following stocks (see table 1). Our previous recommendation and forecasts can no longer be relied upon.
Companies: BLND CAPC DLN GPOR HMSO CCRGF LAND WKP LMP SGRO SHB UTG
Both shortage of warehouse space and e-commerce continued to boost demand for Segro’s well-positioned logistics-oriented sites. The company raised its dividend by 6.1% yoy, to 11.35p per share (in line with estimates). We will upgrade our numbers on the back of the favourable context.
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Revolution Beauty is a multi-brand, multi-category, multi-channel, mass beauty innovator with proven global scale. Since launch in 2014, the Group has grown rapidly (FY14 – FY19 CAGR of 99%) generating revenue of £137.5m in the 12m to 31 December 2020. Revolution has an established retail footprint of c.11,000 doors across leading retail chains in the UK, USA and internationally, driving global brand recognition. This is complemented by a fast-growing digital business (+81% in 2020) including it
Companies: Revolution Beauty Group plc
Companies: Aquis Exchange Plc
Litigation Capital Management has released its results for FY21, reflecting on a positive year for the group in very challenging market conditions. Although well flagged, these set of results highlight the strength of LCM's investment process as it's maturing balance sheet continues to deliver strong returns on capital as key cases settle.
Companies: Litigation Capital Management Ltd
Oversubscription of Gore Street’s PrimaryBid offer is helpful although given the attractions of the energy storage market perhaps not surprising. The larger placing remains open with results announced at the end of the month. Together the c.£70m raise will provide the fund with ammunition to pursue its strong pipeline of storage opportunities.
Companies: Gore Street Energy Storage Fund PLC
Companies: Real Estate Investors plc
Following the successful completion of the Hawthorn disposal, towards the top-end of our £180-230m range, and the transformation to a pure retail property group we update forecasts and briefly set out our investment thesis ahead of the Group’s CMD. We estimate FFO for FY22F, FY23F and FY24F of 7.2p, 8.3p and 9.4p per share respectively; a 3-year CAGR of c35% over the 3.8p generated in FY21A. Post-Hawthorn, balance sheet metrics have markedly improved, flexibility enhanced, and refinancing risk r
Companies: NewRiver REIT plc
Gore Street continues to find good projects in the GB market and has today announced a 57MW project in Leicester. It is now more active in seeking projects beyond the UK and RoI in North America and Western Europe and we think there are significant opportunities in these geographies. The company now has a pipeline of 2.5GWh with 2GWh of that in new geographies and 160MWh of that under exclusivity. With these opportunities in mind the company has announced a placing at 107p.
Today's in-line results illustrate the financial impact from restrictions upon face-to-face Insurance sales over the past 15 months. However, they heavily mask the strategic momentum underway across the Group. Since the lifting of restrictions from June, Insurance is exhibiting a strong and accelerating rebound in demand, which should mark an inflection point for policyholder numbers and restore premium income to pre-pandemic levels over the medium-term. We expect the Group's other product lines
Companies: Personal Group Holdings Plc
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What’s cooking in the IPO kitchen?
Eurowag confirms its intention to undertake an initial public offering on the Main Market (Premium). The Offer would be expected to comprise both (i) new Ordinary Shares to be issued by the Company, raising gross proceeds of approximately EUR200m to support Eurowag's growth strategy and (ii) existing Ordinary Shares to be sold by existing Eurowag shareholders. Eurowag is a leading pan-European
Companies: ALS APP BOD DXRX EDR EOG KOO RBBS TRP UOG
What’s cooking in the IPO kitchen?
Poolbeg, Proposed AIM listing and demerger from Open Orphan (ORPH.L). Funds raised as part of Admission will be used primarily to fund the clinical trial costs associated with the development of the Company’s POLB 001 asset as a treatment for severe influenza and to acquire and develop new portfolio assets. Offer details and timing TBA
Wise, the Fintech and payments start-up is planning to pull the trigger on a direct listing on the London Stock Exchange as s
Companies: ANP DMTR FCRM HUR I3E IGE KWG MTR MEAL POW
Exactly one year ago, the FTSE 100 closed at 5,862, having fallen 100 points on the day, the lowest point since mid-May 2020, due in part, to the strength of sterling vs US$ at $1.34. One year on, the FTSE 100 has risen to 7,119, a rise of 21%, it remains 7% below the peak in January 2020. From an international viewpoint, US and European markets continue to trade at record highs. The US Federal Reserve is close to withdrawing some of its economic support this year as inflation picks up and the e
Companies: AMYT BAG BVC BRSD CLG CML FBD GDWN INV MACF MNZS MIO NRR NSF NBI MATD PREM QFI RUA SCS STVG SUR SNX UPGS VAST VLS
In-line interim results to 30 June 2021 show revenues up 93% to £8.5m, EBITDA up 118% to £2.4m and AUM up 15% to £1.1bn compared with the FTSE All Share, which grew 11.1%. DFM assets outperformed the All Share by almost 4x, increasing 40% to £606m. Recent acquisitions are all performing as initially expected, with the full opportunities that can be realised as a result of the network effects and joined up approach, likely yet to come. While EBITDA is performing very well, reaching 54% of our 202
Companies: Frenkel Topping Group plc
AfriTin* (ATM LN) – Conditional credit approval for Uis mine expansion
Altus Strategies* (ALS LN) - BUY – 125p – Numerous artisanal gold workings discovered on new licenses in Egypt
Botswana Diamonds (BOD LN) – Drilling results link two kimberlite ‘blows' at Thorny River
Caerus Mineral Resources (CMRS LN) – Raising £1.5m in placing and subscription
GoldStone Resources* (GRL LN) – Extension of Gold Loan
Rio Tinto (RIO LN) – Battery storage facility to be installed at Queensland mine
Companies: ATM ALS BOD CMRS GRL RIO
Big Technologies (BIG) provides market leading electronic monitoring (EM) systems on a SaaS (Software as a Service) basis primarily to criminal justice systems around the world. EM involves utilising location technologies to remotely monitor and manage people within correctional systems.
Companies: Big Technologies PLC
Belvoir’s H1 2021 results are exceptionally strong, with adj. EPS up +50%. They were, of course, aided by a very buoyant housing market, but this does not detract from the strategic progress the group continues to make. The group’s growth strategy has supported 24 years of unbroken profit growth and, while 2022 will likely see cooler market conditions, there are increasing signs it will be a gradual return to more normal conditions. The acquisition of Nicholas Humphreys in H1 and The Nottingham
Companies: Belvoir Group PLC