Results for the Year Ended 31 December 2011

21 February 2012

SEGRO, Europe’s leading owner-manager and developer of industrial property, reports strong operational performance and EPRA earnings growth. Good early progress is being made on the recently announced strategy to reshape the Group’s property portfolio.


Year to
31 December 2011

Year to 31
December 2010


EPRA profit before tax (£m)




Profit/(loss) before tax (£m)




EPRA earnings per share (p)




Dividend per share (p)





31 December 2011

31 December 2010


Net asset value per share (p)




EPRA net asset value per share (p)




Loan to value ratio (%)




Strong operating results due to portfolio quality and operational focus

  • Strong income generation, with £38.4m of new rental income contracted during the year (2010: £42.7m); lettings completed 1.7% above December 2010 ERVs

  • Increased retention rate to 74% (2010: 63%), with takebacks reduced to £21.0m (2010: £29.3m)

  • Group vacancy rate reduced further to 9.1% at 31 December 2011, down from 11.4% at 30 June 2011 and 12.0% at 31 December 2010. Former Brixton portfolio vacancy reduced to 13.4% (2010: 18.6%) – acquisition target of sub-15% achieved one year early

  • Total cost ratio reduced to 24.3% (2010: 28.1%), with improved vacancy rates and tight management of operating expenses

  • EPRA profit before tax up 8.8% to £138.5m (2010: £127.3m)

  • 3.5% increase in full-year dividend to 14.8p (2010: 14.3p)

Reduction in Net Asset Value (NAV) impacted by write down of non-core assets

  • Year-on-year like for like core completed portfolio valuation decline of 0.4%

  • H2 2011 non-core portfolio valuation decline of £187.0m

  • 2011 EPRA NAV per share down 9.6% to 340p (2010: 376p)

Good progress with strategic portfolio reshaping

  • £110.9m of disposals in 2011 and post year-end disposal of five non-core UK industrial estates to Ignis Asset Management for £80.2m; further disposals expected over balance of year

  • 14 developments completed during the year, generating £9.0m of annualised rental income

  • A further 20 developments under way or contracted, producing annualised rental income of approximately £18.9m, and an average expected development yield of 9.5%

  • Planned expansion of the logistics portfolio commenced with the £314.7m acquisition of the UK Logistics Fund in January 2012 in a 50/50 JV with Moorfield

Solid balance sheet

  • Funding position further strengthened by significant debt financings arranged in 2011, including €440m (£367m) of new five-year bank facilities and a £400m refinancing of the Airport Property Partnership (APP) JV

  • 78% of net borrowings in long-term bonds; weighted average maturity of gross borrowings of 8.8 years. No significant debt maturities before 2014

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

“We delivered strong income-generation and earnings growth, driven by an excellent operational performance which included further reducing our vacancy rate, significantly increasing customer retention and building a strong pipeline of future income from pre-let developments. We expect the macro environment to remain unsettled for some time to come, both in the UK and Continental Europe. However, we have started the new year with good momentum in our letting activity and our 20 mainly pre-let development projects underpin future rental income. We have a strong balance sheet and a clear focus to build on our strengths by investing in the strongest locations in resilient sectors, both in the UK and Continental Europe, and to recycle those assets which do not fit our strategic criteria. Given the strengths of our operational teams and core assets, we are well-positioned to continue to capitalise on demand for newly-developed and well-located industrial space from a diverse range of customers and industries.”

“As part of the revised strategy for the Group outlined on 8 November 2011, we have made a promising start to reshaping our portfolio with the completion since the year end of the acquisition of prime logistics assets with a joint venture partner and the disposal of a portfolio of non-core holdings in the UK.”


A live webcast of the results presentation will be available from 09.30 (GMT) at SEGRO's website at:

A conference call facility will also be available at 09.30 (GMT) on the following numbers:

UK toll:

+44 (0)20 7136 2051

US toll:

+1 212 444 0481

Access code:


From midday the conference call will be available on a replay basis on the following numbers:

UK toll:

+44 (0) 20 7111 1244

US toll free:

+1 347 366 9565

Access code:


A video interview with David Sleath discussing the results is now available to view on



Paul Barker
Interim Head of Investor Relations

Kate Heseltine
Investor Relations Manager

+44 (0)7714 385957
(21 Feb)

+44 (0)20 7451 9043

+44 (0)7714 390537
(21 Feb)

+44 (0)20 7451 9042

Tulchan Communications

David Shriver
John Sunnucks


+ 44 (0)20 7353 4200


The timetable for the 2011 final dividend will be as follows:

Ex-Dividend date:


March 2012

Record Date:


March 2012

Payment Date:


May 2012

This announcement, the 2011 Property Analysis Booklet and other information about SEGRO are available at

Neither the content of SEGRO’s website nor any other website accessible by hyperlinks from SEGRO’s website are incorporated in, or form part of, this announcement.

Forward-looking statements:
This announcement contains certain forward-looking statements with respect to SEGRO’s expectations and plans, strategy, management objectives, future developments and performance, costs, revenues and other trend information. These statements and forecasts involve risk and uncertainty because they relate to events and depend upon circumstances that may occur in the future. There are a number of factors which could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements and forecasts. Certain statements have been made with reference to forecast price changes, economic conditions and the current regulatory environment. Any forward-looking statements made by or on behalf of SEGRO speak only as of the date they are made. SEGRO does not undertake to update forward-looking statements to reflect any changes in SEGRO’s expectations with regard thereto or any changes in events, conditions or circumstances on which any such statement is based. Nothing in this announcement should be construed as a profit forecast. Past share performance cannot be relied on as a guide to future performance.


To view or download the full press release in PDF format, please click here

Full details of our holdings can be found in the SEGRO Property Analysis

A short video interview with David Sleath, Chief Executive is available by clicking here

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