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  • SEGRO has delivered another strong set of financial, operating and portfolio performance metrics, and a record level of development completions, almost all of which have been leased.
  • Adjusted pre-tax profit up 25.7 per cent reflects our focus on customer and portfolio management (which delivered high customer retention rates, like-for-like rental growth and a low vacancy rate) and investment during the year (principally acquiring full ownership of the Airport Property Partnership portfolio and a record level of development capital expenditure).
  • Adjusted EPS up 5.9 per cent to 19.9 pence (2016: 18.8 pence1), incorporating the new shares issued in the March Rights Issue. IFRS EPS of 98.5 pence (2016: 51.6 pence1), also includes the impact of the 13.6 per cent increase (2016: 4.8 per cent increase) in the value of our portfolio.
  • EPRA NAV per share up 16.3 per cent to 556 pence (31 December 2016: 478 pence1).
  • Balance sheet significantly strengthened by the Rights Issue and debt refinancing activity. We completed £2.7 billion of financing activity for SEGRO and SELP, reducing the average cost of debt to 2.1 per cent and improving the efficiency and strength of the balance sheet.
  • Future earnings prospects underpinned by 1.2 million sq m of development projects under construction or in advanced pre-let discussions, equivalent to almost one-fifth of our current portfolio. The current development pipeline is capable of generating £43 million of rent, equating to a yield on cost of nearly 8 per cent, over half of which has been secured through pre-lets and lettings prior to completion. Our land bank and land under our control provide significant potential for future growth.
  • Final dividend increased by 6.1 per cent to 11.35 pence (2016 final dividend: 10.7 pence1).

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

“SEGRO has delivered another strong set of results in 2017 with some of our best ever operating metrics, underpinned by record levels of development completions (almost all of which is pre-leased) our active investment and asset management, as well as further portfolio valuation growth.

“Occupier demand in early 2018 is strong across all our markets and supply of modern warehouse space remains constrained. The prospects for rental growth, particularly in the UK, remain good, and rental values are improving in our Continental Europe urban warehouse portfolio. Investor appetite for prime warehouses remains unsated, attracted by the occupational market fundamentals.

“The structural drivers of demand in our sector (urbanisation, growth of the digital economy and e-commerce) are likely to underpin occupier demand for some time to come and these, coupled with our modern, well-located assets, our current development pipeline and our land bank all offer significant opportunities for future growth.”


Valuation gains across the portfolio reflect asset management and investor demand

  • Portfolio capital value growth of 13.6 per cent (2016: 4.8 per cent) driven mainly by a 15.8 per cent increase in the like-for-like value of our UK portfolio (2016: 4.6 per cent) and 6.2 per cent in Continental Europe (2016: 0.6 per cent). The increase reflects the benefits of active management of our portfolio, yield compression and improving rental values, enhanced by gains from our development activity.
  • Rental values (ERVs) increased by 3.1 per cent. Rental values in the UK increased by 3.9 per cent (2016: 4.7 per cent) and by 1.2 per cent in Continental Europe (2016: 0.3 per cent).

Strong development and asset management activity, supported by positive market conditions

  • 19 per cent increase in new rent contracted in the period to £53.5 million (2016: £44.9 million), of which £28.6 million (2016: £23.4 million) is from new development pre-let agreements and lettings of speculative space prior to completion.
  • 2.6 per cent like-for-like net rental income growth (5.1 per cent increase in the UK, 2.5 per cent decrease in Continental Europe) aided by a 9.5 per cent uplift on rent reviews and renewals, mainly from capturing reversionary potential accumulated in recent years in the UK portfolio.
  • Low vacancy rate of 4.0 per cent (31 December 2016: 5.7 per cent) and customer retention increasing to 81 per cent (2016: 75 per cent) of rent at risk from expiry or customer break, reflecting our focus on customer service.

Capital allocation focused on accretive development programme and acquisitions to build scale in our target markets

  • Net investment of £592 million in 2017 including development capital expenditure of £414 million and the acquisition of 50 per cent of the £1.1 billion APP portfolio.
  • Total development capex for 2018 again expected to exceed £350 million.
  • £43 million of potential rent from current development pipeline, of which over half has been secured through pre-lets and lettings prior to completion.
  • Further ‘near-term’ pre-let projects associated with £22 million of rent are at advanced stages of negotiation.

Balance sheet strengthened with £2.7 billion of new financing during the year

  • £573 million of (gross) proceeds from the Rights Issue in March provided capital to acquire the APP portfolio and to pursue further development.
  • £2.1 billion of new debt for SEGRO and SELP was signed during the year, repaying more costly, less flexible debt, significantly improving our capital structure, improving the average cost of debt to 2.1 per cent (2016: 3.4 per cent) and the average debt maturity to 10.8 years (2016: 6.2 years).
  • Look-through LTV ratio of 30 per cent (31 December 2016: 33 per cent).

Historic metrics for earnings per share, dividend per share and net asset value per share have been adjusted by a bonus adjustment factor of 1.046 to reflect the Rights Issue carried out in March 2017.
Figures quoted on pages 1 to 14 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                         2017                   2016         Change per cent
Adjusted2 profit before tax (£m) 194.2 154.5 25.7
IFRS profit before tax (£m) 976.3 426.4 -
Adjusted3 earnings per share (pence, basic) 19.9 18.8 5.9
IFRS earnings per share (pence) 98.5 51.6 -
Dividend per share (pence) 16.6 15.7 5.7


Balance sheet metrics 31 December 2017 31 December 2016 Change per cent
Portfolio valuation (SEGRO share, £m) 8,039 6,345 13.66
EPRA4 5 net asset value per share (pence, diluted) 556 478 16.3
IFRS net asset value per share (pence, diluted) 554 480 15.4
Group net borrowings (£m) 1,954 1,598 -
Loan to value ratio including joint ventures at share (per cent) 30 33 -

Per share figures have been adjusted by a bonus adjustment factor of 1.046 to reflect the Rights Issue in March 2017.
A reconciliation between Adjusted profit before tax and IFRS profit before tax is shown in Note 2.
A reconciliation between Adjusted earnings per share and IFRS earnings per share is shown in Note 11(i).
A reconciliation between EPRA net asset value per share and IFRS net asset value per share is shown in Note 11(ii).
Calculations for EPRA performance measures are shown in the Supplementary Notes to the condensed financial information.
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.

View the full press release in PDF format.

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

Watch a video interview with David Sleath, Chief Executive and Soumen Das, Chief Financial Officer.


A live webcast of the results presentation will be available from 09.00 (UK time) at:

The webcast will be available for replay at SEGRO’s website at: by the close of business.

A conference call facility will be available at 09:00 (UK time) on the following number:
Dial-in: +44 (0)330 336 9411
Access code: 6261992
An audio recording of the conference call will be available until 23 February 2018 on:
UK & International:   +44 (0)20 7660 0134
Access code: 6261992

A video interview with David Sleath, Chief Executive, discussing the results is now available to view on, together with this announcement, the FY 2017 Property Analysis Report and other information about SEGRO.


2017 final dividend ex-div date 22 March 2018
2017 final dividend record date 23 March 2018
2017 final dividend scrip dividend price announced 29 March 2018
2017 final dividend payment date 3 May 2018
2018 First Quarter Trading Update 18 April 2018
Half Year 2018 Results 26 July 2018


SEGRO is a UK Real Estate Investment Trust (REIT), and a leading owner, manager and developer of modern warehouses and light industrial property. It owns or manages 6.7 million square metres of space (72 million square feet) valued at over £9 billion serving customers from a wide range of industry sectors. Its properties are located in and around major cities and at key transportation hubs in the UK and in nine other European countries.

Forward-Looking Statements: This announcement contains certain forward-looking statements with respect to SEGRO’s expectations and plans, strategy, management objectives, future developments and performances, costs, revenues and other trend information. These statements are subject to assumptions, risk and uncertainty. Many of these assumptions, risks and uncertainties relate to factors that are beyond SEGRO’s ability to control or estimate precisely and which could cause actual results or developments to differ materially from those expressed or implied by these forward-looking statements. Certain statements have been made with reference to forecast process changes, economic conditions and the current regulatory environment. Any forward-looking statements made by or on behalf of SEGRO are based upon the knowledge and information available to Directors on the date of this announcement. Accordingly, no assurance can be given that any particular expectation will be met and SEGRO’s shareholders are cautioned not to place undue reliance on the forward-looking statements. Additionally, forward-looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Other than in accordance with its legal or regulatory obligations (including under the Financial Conduct Authority's Disclosure Guidance and Transparency Rules), SEGRO does not undertake to update forward-looking statements to reflect any changes in events, conditions or circumstances on which any such statement is based. Past share performance cannot be relied on as a guide to future performance. Nothing in this announcement should be construed as a profit forecast.

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.

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