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Segro plc (LON:SGRO) has today announced its results for the year ended 31 December 2019.


·    Adjusted pre-tax profit, up 10.8 per cent, reflecting a record year of development completions, high customer retention rates, like-for-like rental growth and a low vacancy rate.

·    Adjusted EPS of 24.4 pence, an increase of 4.3 per cent compared to 2018 (23.4 pence) or 9.9 per cent excluding the impact of the SELP performance fee received in 2018 (payable every five years). IFRS EPS of 79.3 pence (2018: 105.4 pence) reflects the 7.5 per cent increase in the value of our portfolio (2018: 10.7 per cent increase).

·    EPRA NAV per share up 8.9 per cent to 708 pence (31 December 2018: 650 pence). IFRS NAV per share was 697 pence (31 December 2018: 644 pence).

·    Future earnings prospects underpinned by 1.2 million sq m of development projects under construction or in advanced pre-let discussions. This equates to an additional 15 per cent of space and £70 million of potential rent, 71 per cent of which relates to pre-lets and lettings prior to completion.

·    2019 full year dividend increased by 10.1 per cent to 20.7 pence (2018: 18.8 pence). Final dividend increased by 8.7 per cent to 14.4 pence (2018: 13.25 pence).


Valuation gains and rental growth across the portfolio with Continental Europe outperforming the UK

·    Portfolio capital valuation surplus of 7.5 per cent driven by a 2.5 per cent increase in the like-for-like value of our UK portfolio (2018: 12.0 per cent) and 13.5 per cent in Continental Europe (2018: 5.1 per cent). Valuation gains were driven mainly by asset management, rental value growth (UK: 2.6 per cent, Continental Europe: 3.0 per cent), development gains and further yield compression in Continental Europe.

Operational metrics at record levels thanks to active asset management and strong occupier demand  

·    £65.8 million in annualised new rent commitments in the period (2018: £66.4 million), of which £33.2 million (2018: £41.5 million) is from new development.

·    4.7 per cent like-for-like net rental income growth (5.7 per cent in the UK, 3.1 percent in Continental Europe) aided by an average 17.8 per cent uplift on rent reviews and renewals. The UK figures include the significant impact of lease re-gears and renewals at the Heathrow Cargo Centre.

·    Vacancy rate remains low at 4.0 per cent (31 December 2018: 5.2 per cent) reflecting strong lettings of recently completed speculative developments and some vacant asset disposals. Our continued focus on customer service has kept customer retention high at 88 per cent (2018: 89 per cent).

Capital allocation focused on funding further development-led growth

·    £692 million of investment in our portfolio, including £556 million invested in development capex, infrastructure and land as well as £136 million of asset acquisitions. This was partially offset by £442 million of asset and land disposals (including sales of assets to our SELP joint venture).

·    Total development capex for 2020, including infrastructure and land acquisitions, expected to exceed £600 million.

·    £50 million of potential rent from current development pipeline, 60 per cent of which has been secured. This includes £10 million of potential rent from speculative urban warehouse developments in the very attractive London market.

·    £20 million of potential rent from further ‘near-term’ pre-let projects which are in advanced stages of negotiation. Our land bank and additional land under our control through option agreements provide significant potential for further growth.

Balance sheet

·    SEGRO continues to be appropriately and efficiently financed. The average cost of debt remains attractive at 1.7 per cent (2018: 1.9 per cent), the long average debt maturity has been maintained at 10.0 years (2018: 10.2 years) and look-through LTV ratio has reduced to 24 per cent (31 December 2018: 29 per cent).

·    Equity placing of £451 million completed in February 2019, providing capacity to continue to invest for growth.

·    SEGRO has almost £1.4 billion of cash and available facilities at its disposal.

1 Figures quoted on pages 1 to 16 refer to SEGRO’s share, except for land (hectares) and space (square metres) which are quoted at 100 per cent, unless otherwise stated. Please refer to the Presentation of Financial Information statement in the Financial Review for further details.


Income statement metrics 2019 2018 Change
 per cent
Adjusted1 profit before tax (£m) 267.5 241.5 10.8
IFRS profit before tax (£m) 902.0 1,099.1 (17.9)
Adjusted2 earnings per share (pence) 24.4 23.4 4.3
IFRS earnings per share (pence) 79.3 105.4 (24.8)
Dividend per share (pence) 20.7 18.8 10.1
Balance sheet metrics 31 December
31 December 2018 Change
per cent
Portfolio valuation (SEGRO share, £m) 10,251 9,425 7.55
EPRA3 4 net asset value per share (pence, diluted) 708 650 8.9
IFRS net asset value per share (pence, diluted) 697 644 8.2
Group net borrowings (£m) 1,811 2,177
Loan to value ratio including joint ventures at share (per cent) 24 29

1 A reconciliation between Adjusted profit before tax and IFRS profit before tax is shown in Note 2.

2 A reconciliation between Adjusted earnings per share and IFRS earnings per share is shown in Note 11(i).

3 A reconciliation between EPRA net asset value per share and IFRS net asset value per share is shown in Note 11(ii).

4 Calculations for EPRA performance measures are shown in the Supplementary Notes to the condensed financial information.

5 Percentage valuation movement during the period based on the difference between opening and closing valuations for all properties including buildings under construction and land, adjusting for capital expenditure, acquisitions and disposals.

Commenting on the results, David Sleath, Chief Executive, said:

“2019 was another successful year for SEGRO, with our clear strategy delivering excellent financial and operational results. Our high-quality, well-located portfolio of urban and big box warehouses continues to attract a broad range of customers, benefitting from the structural drivers of e-commerce and urbanisation. As anticipated, these trends are now having an increasing impact on the Continent as well as in the UK.

“We have started 2020 in a strong position. Our substantial, mostly pre-leased development pipeline, along with the ongoing results from the active asset management of our existing portfolio, should enable us to drive further sustainable, compound growth in rental income, earnings and dividends over the coming years.

“This year SEGRO celebrates its one hundred year anniversary. We will continue to take a long-term view, reflecting the interests of our financial stakeholders and our wider responsibilities, as we look to position the business for further success in its next century.”


A live webcast of the results presentation will be available from 08:30am (UK time) at:


The webcast will be available for replay at SEGRO’s website at: http://www.segro.com/investors by the close of business

A conference call facility will be available at 08:30 (UK time) on the following number:Dial-in:                           +44 (0)2071 928000Access code:                4534627 An audio recording of the conference call will be available until 21 February 2020 on:UK & International:          +44 (0) 3333 009785Access code:                  4534627

A video interview with David Sleath, Chief Executive, discussing the results is now available to view on www.segro.com, together with this announcement, the Full Year 2019 Property Analysis Report and other information about SEGRO.

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