* Demand affected by current market conditions - CEO
* Says on the lookout for site acquisitions in London
* FY adj pretax profit 20.2 mln stg vs 16.5 mln stg yr ago
* Shares down 3 pct
(Adds comments by CEO in paragraph 3,4,5, analyst in
penultimate paragraph; updates share movement)
By Anirban Sen
BANGALORE, May 24 UK self-storage company Big
Yellow Group Plc said a recovery in the sector was
unlikely until the economy improves, bringing its shares down 3
Some analysts fear that high unemployment, negative real
income growth, high debt levels and difficulties in obtaining
credit will continue to weigh on the housing market that will
hit house movers, who are storage companies' biggest customers.
"In the UK, at the moment we're operating in a very subdued
environment, where the economy did not really do very much since
September," Chief Executive James Gibson said in an interview.
Gibson said the current economic conditions had slowed down
demand for the company, which generates much of its revenue from
"It is a flexible space product if you like...and that
demand does have some dependency on activity in the economy,"
Big Yellow, whose stores are mainly in London and South-East
England, also plans to open three new stores this year and is on
the lookout for site acquisitions in London, Gibson said.
The company, which has 63 stores and another seven in
development, raised its final dividend by 25 percent to 5 pence
a share, bringing the full-year dividend to 9 pence a share, it
said in a statement.
April-March adjusted pretax profit rose to 20.2 million
pounds ($32.8 million) from 16.5 million pounds a year ago.
Revenue rose 7 percent to 61.9 million pounds, with store
revenue up 8 percent to 59.6 million pounds. Adjusted net assets
per share were down 1 percent to 449.8 pence.
Peel Hunt, which reduced its price target to 390 pence from
424 pence but maintained its "buy" rating on the stock, termed
the results "marginally disappointing" and said that conditions
would remain tough for self storage firms.
Shares in Big Yellow, whose peers include Safestore
and Lok'n Store , were down 11.4 pence at 333 pence at
1015 GMT on the London Stock Exchange, making the stock the top
percentage faller on the FTSE mid-cap index .
($1 = 0.616 British Pounds)
(Reporting by Anirban Sen in Bangalore; Editing by Don
(firstname.lastname@example.org; within UK +44 207 542 7717;
outside UK +91 80 4135 5800; Reuters Messaging: