The National Storage REIT (ASX: NSR) share price is dropping lower on Wednesday despite the release of an upbeat annual general meeting presentation.
In morning trade the self-storage operator's shares are down 1% to $1.82.
What was in its annual general meeting update?
Along with the summary of its performance in FY 2020, management provided investors with an update on how it was performing in the new financial year.
According to the release, National Storage has started FY 2021 in a positive fashion, with its combined occupancy up 5.6% year to date to 84.5%.
Management notes that in excess of 60,000 square metres of occupancy has been added since 1 July, which is the equivalent of 12 full centres.
Also increasing in FY 2021 has been its revenue per available square metre (REVPAM) metric. At the end of the first quarter, it stood at $200. This is up from $195 at 30 June.
In respect to occupancy levels, management notes that almost half (48%) of its centres are now operating with occupancy levels above 85%. Approximately 23% are above 90% occupancy.
Another positive is that the pandemic hasn't stopped the company from pursuing its growth through acquisitions strategy. It completed eight acquisitions totalling $139 million, adding 54,100 square metres of net lettable area. Pleasingly, its forward-looking acquisition pipeline remains strong.
In addition to this, there are four expansion projects that are nearing completion and its development pipeline remains strong with seven projects expected to be completed during FY 2021.
Outlook.
National Storage is one of only a handful of companies that are confident enough to provide guidance for the full year. Though, admittedly, it has provided a reasonably broad guidance range.
Management revealed that it expects to report underlying earnings of $78 million to $84 million and underlying earnings per share of 7.7 cents to 8.3 cents per security.
This compares to underlying earnings of $67.7 million and earnings per share of 8.3 cents in FY 2020.
