Investor Day 2021

Sep 9, 2021

Slides

Hello, everyone. My name is Caroline Tirifai, Director of Investor Relations. Welcome to all of you and thank you very much on behalf of the entire Surgar team for attending our Surgar 2021 Investor Day. Before we start, let's go over some house rules. This Investor Day broadcast will be available on demand immediately after the live session via the same link. It will also be posted on our website. We will make this an interactive session. So please Ask your questions via the orange Ask a Question button. The button will appear at the bottom right corner of the screen if you move your mouse over the screen. Feel free to ask questions as we go through the slides. We will try to answer as many questions as possible during the Q and A sessions. I would also like to remind you that the information presented today including the Q and A sessions contains forward looking statements with regard to Surgard's financial condition, results of operation, business, Strategy and Plans. Actual results may differ materially from the forward looking statements as a result of a number of risks on uncertainties. Risk are described in our annual report. As we are entering a new phase of our growth Thore. We are very excited to take you through our strategic and business outlook for the coming years. In the next 2 hours, we will have 2 main sessions. In the first session, after an introduction by Marc, we will go through our 3 levers of growth. We will close this first session with a Q and A. After a short break, we will be back for a second session to discuss how we will further optimize our platform through digitalization. Afterwards, we will be presenting our ESG goals and we'll go through financial elements before concluding remarks. This second session will also end with a Q and A. Now let me give the floor to our CEO, Marc Orsaint. Thank you, Caroline. So welcome to our 1st Investor Day. For the ones who do not know me, I am Marc Orsaint, CEO of ShorGuard. I am with the company for 10 years after 20 years in retail across the globe. But let me first introduce to you our great executive team. Jean, our CFO, with Shogard since 2003 is Belgian and is an expert of self storage with a wide experience of the financial world. Jean and his team were instrumental in our successful IPO in 2018. Duncan, our VP Operations, who is British, We showed out for 12 years and has been able to build a very strong and reliable operational chain of command. Amar, we showed out for 7 years And with 16 years of experience in Sub Storage is American. Amar has successfully developed our HR development and with his general counsel responsibilities has actively participated to our IPO. Last but not least, Isabelle, who is Belgian and recently joined Sharguard. She has a long and thorough experience in Investment Banking and will be in charge of our capital deployment. Each of them will be part of this presentation. Therefore, feel free to question them during the Q and A sessions today. In addition to our engaged and performing executive team, You can see on this slide our complete management group with 15 people. I must say that I am very proud of them and their teams. This group of individuals has the cultural diversity, the experience of management and the knowledge of this industry for Europe and for each country where we are operating. Some of them will be as well part of this Investor Day. Therefore, use the Q and A sessions to interact with them. Let's start now with our growth ambitions and market opportunities. Our resilient Prime Penn European platform is unrivaled for a couple of reasons. First, its size close to 250 properties and more than 1,200,000 square meters. 2nd, our significant geographical presence, 7 markets, mainly Northern Europe, Capital Cities plus Tier 1 Cities, Representing 93% of our property's footprint. And 3, our buildings are big, 5,000 square meters on average and designed for self storage, 65% of them, revenue with 15 years of age and we are the owners with 93% of freehold. Therefore, having 7 markets with significant size and proposing a real geographical diversification has been appreciated by investors during the peak of the COVID crisis. Our Prime Penn European platform also brings for a clear leadership in the industry of self storage. As I mentioned previously, we are the largest player And we are operating the double of square meters than our 2 closest competitors. Our leadership In addition to the size of our platform, based on great performances of our teams as measured by Glassdoor on how our customers are rating us through Google reviews and how our brand awareness is perceived in our 7 markets. We have the chance to be in a growing industry in Europe. And this slide shows you the average yearly pace of growth in square meters for the safe storage industry reaching a 9% CAGR. This is clearly a significant speed for the real estate world. I must say that this growth of additional square meters took place mainly in secondary and tertiary cities, which makes sense because developing in capital cities or Tier 1 cities is much more difficult. Our industry benefits from a particular situation between demand and supply. I mean by this that we have a structural and balanced situation, low supply, You can see on the left side how European countries are underdeveloped versus the American market. It goes from 13 times less in the UK, up to 100 times in Germany, therefore, plenty of potential. Interestingly, we are an urban product in the B2C world and you see that the penetration in capital cities It's always higher than the respective country ones. If you look at the key fundamentals of our demand, We are combining density of population, lack of space, with life events for residential customers, 80% of our customer base. When these life events as divorce, marriage, birth, death, Mobility, Ocker, they are triggering the need of temporary storage. I must say that since Google and Smart have taken over the way people live, the awareness of the brand and price transparency are more and more important. In addition to these residential customers considering self storage as a basement or attic in a remote location, our business customers Most of our business customers are small companies. If you look at the fundamentals, density and life events, The long term trends are in our favor. Large metropolitan areas are growing and life expectancy is growing, which means more life events. After having described shortly who we are and how the industry is evolving, let's talk about our performance. You probably remember that Shoguard became a public company in October 2018. Having Shoguard listed has brought much more attractiveness to self storage in Europe. The investors community suddenly discovered a significant player and opportunities of growth at the European scale. The commitment we took at that time in terms of growth of revenues, Earnings, development and financing have been all met. And I can say on the behalf of our team, mission accomplished. If you compare what the situation was in 2018 and what we are facing today in 2021, we have major differences in multiple areas. For example, COVID broke out. Brexit took place. Political leaders are not the same. Digitalization is booming. Sensitivity to security is higher. Importance of ESG for the investor community and citizens is dramatically different than 3 years ago. Therefore, the continuation of demonstrating our performance since 2018 and the opportunities brought by this new context have triggered from our executive team and the Board of Directors the will to write a new chapter for our company in continuity with the strategy shared at IPL. We want to go faster and grow more Our acceleration, a new chapter for ShorGuard is based on 4 pillars. The number 1 pillar, adding more square meter every year to our platform, combining more new properties and merger and acquisition as Isabel and Vincent will share with you. The number 2 pillar, accelerating the digitalization in different fields, such as customer conversion, building management and others. Duncan and Jean will take you through the various initiatives we're implementing. Number 3 pillar, continue to improve our ESG performance With, for example, a net zero carbon strategy and executed, Amar and myself will detail different actions we are taking. Last but not least, our number 4 pillar, Jean will explain how our conservative financing policy, combining low LTV, earning growth and optimized dividend We'll deliver an attractive total shareholder return. I will now let Isabelle, our new CIO and Vincent, our Director of Acquisition, Thank you, Marc. The way to expand the footage of our company has not changed. We maintain our 3 existing levers. We simply plan to do more and to do it faster. These three levers are, 1st of all, increase the size of existing buildings knowing that we own 93% of them. We call this redevelopment. Secondly, new developments, buy land and build property for self storage all by existing buildings and convert them into self storage. For instance, former warehouses, office buildings, This is the organic growth of our platform. And thirdly, market consolidation. As the leading market consolidator, we acquire competitors' properties, in particular, from small and individual players. Overall, we aim to double the speed of our portfolio expansion. We plan to invest €170,000,000 annually by 2024. Let's go deeper into our first lever, redevelopment. We've already done a lot these past years. Since 2015, we've realized 26 projects, bringing 26,000 square meter to the platform with a yield at maturity above 10%. Going forward, We anticipate bringing approximately 1,000 square meter redevelopments per year, which is less than in the past. However, We continue to screen and investigate our portfolio to identify opportunities. Now let's talk about organic growth, which is our 2nd lever and a key one to grow the company. First, a couple of facts regarding Schogard. Are we present in large and growing metropolitan areas with good level of income? Yes, we are. Do we have size and market share in these cities? Yes, we have. Do we operate our platform efficiently in these areas? Yes, we do. Are we missing some interesting cities in our 7 countries? Yes, a couple. And do we currently develop where we should? Yes, with London, Paris, Berlin and Cologne Dusseldorf. And is there enough potential for self storage in these cities? And the answer is yes, plenty. Therefore, our strategy is to continue to open new properties in the 4 areas mentioned: London, Paris, Berlin, Cologne Dusseldorf and add at least 4 other metropolitan areas to these ones. We continue to believe that by focusing on the 7 markets in our organic growth plan, we will get the full benefit of economies of scale as well as speed of execution. Based on that conclusion, you can see in the blue box on Slide 17 that we've decided to open new areas for development in 4 additional cities in the Netherlands and in Germany. We will start to be active in Randstad, the conurbation of Amsterdam Utrecht, Rotterdam and Dengargh with 7,000,000 inhabitants And where we already have 40 properties with a strong leadership, we will also actively develop 3 additional cities in Germany that are in the top 6 cities of this country: Munich, Frankfurt and Stuttgart. The acquisition of 4 existing properties made in 2020 in Munich will serve as a base for organic development there. Of course, we will continue to open properties in our 4 current areas that are London, Paris, Berlin and Couronne de Souders. We have the ambition to double the pace of our current development program. The question is, is it feasible? Looking at the past 3 years, we've been able to open on average 5 properties within these four areas of active development, meaning an average of more than 1 property per year per area. Therefore, going from 4 cities to 8 We'll enable us to open 10 properties per year versus the current 5. We believe this fleet of development is sustainable. Then the second question, what is the lead time to reach this new pace of development? If you look at the Top of Slide 19. You can see that in the past year, it's taken more or less 2 years to develop a property from scratch to opening. Therefore, going from 5 to 10 properties per year will be achieved as of 2024 with an intermediate phase at 7 properties in 2023, as you can see outlined at the bottom of Slide 19. You can see on this graph how our CapEx for development or organic growth has evolved in recent years and how we plan to invest in the coming 5 years. We've reached a run rate of €60,000,000 per year, meaning 5 properties, and our goal is to double it within 2 years. Therefore, by 2024, the CapEx for development will be at €120,000,000 for 10 properties opened every year in delivering an 8% yield at maturity. Vincent Mezon, our Director of Acquisitions, We'll now share with you our ambitions in terms of acquisitions. Thank you, Isabelle, for taking us through the first to the 2 levers of our growth strategy. I'm Vincent. I've been with SureGuard for 12 years. I have 20 years of experience in auditing, operations with a legal background. I speak English, France Netherlands und Deutsch, which enables me to communicate with the various owners and operators in their respective languages. Let me take you through our 3rd lever, the acquisitions. I'll start off by looking back at our impressive track record. Over the past 6 years, we've acquired a total of 46 stores across 6 different markets for a total investment of €416,000,000 The size of these transactions varied from buying 1 to 21 properties. We're proud to say that we are the only operator that has this impressive track record. On all of these transactions, we have maintained our focus on our existing markets. We've expanded where possible through acquisitions into other Tier 1 cities where we had no presence yet. We've also maintained a focus on the overall quality of the assets to ensure they form a good fit into our business. It is important to highlight that on these transactions, we've anticipated an NOI yield of 8% or more. By doing all these transactions, we've developed a strong expertise in integrating the acquired product into our portfolio. Thereby, we immediately benefit from our scalability and standardization we have in place in our platform. Once we acquire the stores, we start integrating as of day 1, focusing on the staff, to buildings and to web presence. This ensures that we quickly grow the business performances to levels comparable to our existing portfolio. As we have done 12 deals in the last 6 years, We've been able to develop a unique expertise, integrating stores into our existing portfolio quickly and efficiently. Both our staff internally and our partners leverage off their previous successes to ensure a seamless integration within 24 hours. Having an efficient integration process in place Ensures positive revenue impact shortly after acquisition of new stores. We see that smaller operators have been facing very challenging environment over the last few years. COVID-nineteen has thrown at them the challenge of collecting rent on a timely basis. Even before COVID-nineteen, they have seen an increased challenge in maintaining their presence on the web. Each year, online marketing cost has become more competitive. It is more challenging for them to maintain a solid Level of inquiries flowing into their business. A visible online presence is becoming more costly each year. Thus, scale is crucial to be able to continue bearing these costs for the future. These smaller operators also continue to face growing competition from larger operators continuing to expand their portfolio and increasing presence in the market. By including the acquired products into the Schogorg ecosystem, We ensure a quick uptick of business performances to occupancy levels and rate levels comparable to our existing portfolio. This is our existing playing field in which we scout my next acquisition opportunities. We've been able to successfully deliver on our commitments of acquiring 3 stores each year since IPO. The small bolt on acquisitions are usually family owned and part of a larger set of businesses held by the families. The medium sized competitors on the other hand are held either within families as the core business or held by institutional or private equity investors with the goal of growing the portfolio further. We've established a good reputation and relationship with most brokers, owners and operators, which makes us the first protocol when a sale or partnership is being considered. In this respect, feel free to contact me if you see any opportunities in the market. Given our past performances on this 3rd lever of growth, we feel confident that we can up our guidance from 3 to 6 stores a year as from next year. This means we will increase our total footage every year by 2% of the current portfolio and invest €50,000,000 annually. We can also confirm that level of investment for 2021. With that, I turn it back to Isabelle for the conclusion of this first session. Thank you, Vincent. In summary, we're accelerating the expansion of our portfolio. We plan to double our annual growth between now and 2024. This represents an annual investment of €170,000,000 or approximately 60 new properties per year. This €170,000,000 investments will be split into, on the one hand, 120,000,000 of developments or approximately 10 properties and on the other hand, 50,000,000 of acquisitions or approximately 6 properties. Combined, we hope to deliver 90,000 square meter per year by 2024 or 7% to 8% of our current portfolio. This concludes the first part of our presentation. Before we move to the second part, I would like to pause here for Q and A. While we gather your questions, we have the pleasure of sharing a 2 minute video. How to pack for a move? Choose the right box. Throwing everything into a box will likely cause damage, so pack wisely. Heavy items like books should go into small boxes. Your clothes can be kept wrinkle free in wardrobe boxes. Plus, it saves time when unpacking. And other lighter items, such as your teddy, can go into a large box. Don't overload the sis. Boxes should weigh no more than you can comfortably lift. Put heavier items at the bottom to create a stable base. Make sure that the boxes do not bulge at the top or sides. This way, they will stay stable when you stack them in your storage unit. Tape and label your boxes. Clearly label each Cover furniture, mattresses and rugs in blankets and plastic wrap to keep them in good condition during the move and while in storage. For the best results, pad and wrap everything up securely. Well, maybe not everything. For our first Live Q and A, I have Isabel, Vincent and Mark with me to answer your questions regarding our accelerated growth plan. Our first question is from an investor and is for Mark. What are the main drivers in the industry? Do you Speck that COVID and home working will drive people out of dense areas to the countryside. Thank you, Caroline. So as you have seen in the presentation, the key drivers of our business are the combination of actually density of population within the catchment area, combining this with what we call the life events. So I repeat, marriage, birth, death, Divorce and also mobility. So obviously, due to the COVID, some people might move out of the Center of the major capital cities. But however, the good thing for us is first, if they move, they will need for space to. And secondly, actually what is happening is that today already in these capital cities, if you take Stockholm, London, Paris, Berlin, You can name them. Actually, the market of residential affordable residential is completely unbalanced. You have much more demand versus the supply. So if you have even if you have some people leaving the downtown, it will not change the structural need for more people into the center. So I don't expect to have a major impact on our business due to this potential COVID. Okay. Thank you, Marc. Also going question is for you Vincent. 3rd party management an opportunity? Well, thank you, Caroline. Well, that's an interesting question and It definitely is an opportunity. This has been something that's been going on in the U. S. For quite a while. Our main shareholder Public Storage has Become active in the market of 3rd party management as well over the last couple of years, which has given us opportunities to learn from their experience as well. We have done some 3rd party management over the last few years in line of M and A transactions. But Actively marketing third party management has not been something we've done. We see that coming up in the U. K. Recently. Today, basically, there's no persons developing self storage and asking for 3rd party management, but we're open to the opportunity. And it would give us obviously an interesting pipeline going forward into my Rome, which is the 3rd lever, the M and A transactions. Okay. Thank you. I have another question for you Vincentian. Do you expect private equity funds to become a threat for your M and A strategy? Well, it has been a threat we had would happen that we lost the transaction to private equity. But we definitely have the upside because we have the scale. And as we mentioned, scale in this line of business is very important. So from that perspective, the activity of private equity has been limited up to date, but could pick up in the medium term as the attractiveness of the business becomes more visible. Thank you. You're very welcome. The next question is from Andrew Gilles from Jefferies, and this question is for Marco. Thank you. Yields of 7% to 8% are slightly below the 8% you've previously guided. Is this impacted by a certain type of expansion, e. G. Yields being low for bolt on acquisition? All right. Thank you for that question. So It's true that since the IPO, we have mentioned 8% for our organic growth and also for the M and A. Here, due to the fact that you have a pressure On construction cost recently, I would say, since the end of the second wave of the COVID, plus clearly more competition, As mentioned, Vincent, regarding M and A, we have anticipated a slight decrease of our yield and that's why we mentioned 7% to 8%. But we are still able to do some deals above 8%. We believe so. And therefore, targeting 7% to 8%, we simply want to be conservative. Okay. Thank you. We have another question. Tim Leckey from JPMorgan asked, what change for allowing the increase in investment volumes to ensure its success. That's for you, Isabelle. Thank you, Tim, for that question. I think the answer is twofold. It's staff and scope. And as you can see on Slide 19, We highlighted that we're planning to expand the teams by 20 FT feet feet feet feet feet feet feet feet feet feet feet feet Es. This is across the existing areas and the new Four areas across the 7 countries. And secondly, scope, as you saw on Slide 18, we're increasing our 4 areas Active of development, London, Paris, Berlin and Cologne Dusseldorf with another four areas in Netherlands and in Germany. So we're basically doubling the active areas of development. Okay. Thank you. I have another question of Tim, but that's for you, Mark. If a larger acquisition opportunity came along, would you consider it? Of course, yes, definitively. So if something big It's potentially feasible in the market. We will actively and it, of course, makes sense with the geographies in which we are. But globally, the answer is yes. And this is also linked to what Jean will present to you in the second section of this Investor Day, which is how we are Managing carefully our balance sheet in order to be able to catch these opportunities that could come from a major and larger acquisition. Okay. Thank you. You're welcome. We have several questions from Mario Spastou from Societe Generale. Isabel, The accelerated growth target, will this be a gradual ramp up from 2022 onwards? So the answer is twofold. On the development side, the answer is yes. It will be gradual. As we Explained on Slide 19, it takes about 2 years to open a new site from scratch to opening. So logically, if we start expanding today, we will be at our target 10 properties by 2024 with an intermediate Step of 7 stores in 2023, so 5 in 2022, 7 in 2023 and 10 in 2024. On the acquisition side, on the other hand, the answer is no. We will be at 6 stores per year as of 2022. Thank you. Marc also from Mario Pastou. Could you please confirm the target yield for each of your 3 growth levers? Well, as well, thank you for that. As I mentioned previously, so you know that we have these 3 levers of growth, so what we call redevelopment, So expanding existing buildings and here it will be above 10% in terms of yield at maturity. And then regarding the to other levers, so what we call organic growth, as I explained actually, Isabelle, so opening new properties, plus M and A, Vincent. Here, the targeted yield at maturity is between 7% 8%. Okay. Next, could you provide more color on the countries and cities where you want to accelerate growth? And that question was from John Wong from Kempen. Your mic? Okay. So fine. So why, as Isabel explained, why, for example, going to Randstad and Randstad is this conurbation in the Netherlands where you have Amsterdam, Den Haag, Utrecht and Rotterdam, we're talking about 7,000,000 people, so roughly 40% of the whole population of the Netherlands. And then why new cities in Germany as Stuttgart, Frankfurt and Munich? So the answer is quite, I would say, simple. It's the combination of Population, so the size of what we're talking about. So is it a big pond? And secondly, are the demographics interesting in terms of level of income? And 3, the potential. Do you have a growth of the population in these areas? And 4th, our own performance. Are we making good money in these areas? Are we managing the properties well? And are we delivering the good numbers? And therefore, if you have the potential there and you are doing well, then of course, you want to develop. And that's why we've picked up these 4 new areas on the top of the Historical 4, I would say, that we have that are Paris, London, Berlin and Cologne and Dusseldorf. Again for you, Mark, a question from an investor. Do you expect Europe to catch up to the U. S. Penetration level? The answer is no. And why no? Because the U. S. Market is already 10 times, as you have seen, more than 10 times actually what Europe is. I was referring to the U. K. And Germany as 2 extremes in Europe. The U. K. Is 13 times less in terms of penetration of the industry versus the U. S, while Germany is 100 times less. So and the U. S, by the way, continue to go and to grow and to develop their business. So it means that they are very large and they continue to accelerate. So it means that we, Europe, are behind and we are much But the good thing is, is that in Europe, you still have a lot of potential to grow. So the race is within Europe, Which is to me the most important thing is how we can grow with ShorGuard within this fantastic market of self storage. Thank you, Caroline. We'll take one more question. Marc, one of our investor is asking, what about Spain and Eastern Europe markets? Why are you not developing and pursuing a development and acquisition strategy outside your current market. Well, thank you because we had a couple of times this question during the different roadshows we have done since the IPO. And actually, What you need to understand, and again, it's back to what you will see in the second section of this presentation, is that profitability comes from scale. So And as Isabel has explained to you, it takes time to develop organically in a given country. It may take 2 years. So plus the time to ramp up the property and then to be at full speed in terms of revenue. So therefore, The scale is in the 7 countries where we are. And by the way, I've just said to you that the potential of in these countries is massive in terms of demographics. Therefore, why going to countries where maybe it's interesting to go to Barcelona and Madrid for sure, but where we are currently today, We have the potential, we have the experience and we have the performance. So that's why we stay focused on that. Having said that, obviously, And M and A would be the answer if there are any significant and obvious opportunities to be in cities like, again, Barcelona and Madrid. Eastern Europe is a different story. The cities are much smaller. But clearly, Spain would be an interesting playfield With these 2 cities, but if there are any opportunities to acquire a significant player over there, for sure, we'll look at that carefully. Excuse me, I have some additional question for you, Marc. When you refer to a yield, is this after operating expenses or before operating Vincent. Of course, after, we are talking about the NOI yields, our net operating income, which is revenue minus all the operating expenses. And then you have this you could call it a kind of a personal EBITDA, and we are talking about this level, so. And we have another question from Wim Liwei from KBC. When bidding for development plots near the city centers, Who do you typically bid against? I guess, e commerce logistic players? Has that an impact on the pricing? Thank you, Carla. Thank you. So here, the actually, the bidding situation or the bidding market for this kind of plots is pretty simple. First, we are looking for lands where the zoning allows us to do self storage, which means that usually, let's say, it is a kind of patch of light industrial area because we don't go for a change of zoning or it will take very long time. What we are looking first is to find this kind of lands, 1st and secondly, we know that we can do that zoning and therefore, what we need to know is the massing, so the building permit, if you prefer. So the bidders that we are facing are 2 kinds of people. 1st, residential bidders who are willing to go for another zoning, It takes a lot of time for the potential seller, but sometimes we are facing these people. And secondly, sometimes some logistic guys who are willing to Buy a piece of land, very downtown or at least embedded into a resi area. So the impact of that, yes, it's true. It's more competitive, but we have some pluses. And by the way, we have been able to demonstrate that in London, which has been a very buoyant market the past 5 to 6 years, we have been able to develop every year on average 1 to 2 properties. And therefore and we just started also in Berlin. We have developed the past 2 years And Paris is moving along pretty nicely. So I would say that with the economy of scales that we have, we are able to put on the market for the seller. I would say interesting numbers to be able to acquire this piece of land. Thank you all for your answers. We are now proceeding to the 2nd part of the Investor Day. Duncan and John will explain how we are optimizing our platform through digitalization. Thank you for all the interesting questions. John and I will now walk you through how we plan to further digitalize our customer journey and operational platform. First, let me remind you what self storage is. It is 1st and foremost a B2C business. For our customers, their unit is the equivalent of their basement or attic In a remote location, so like most of us, when you store belongings in your basement or attic, you want them close by because you think you will need them regularly, We tend to forget what you stored. Same happens with self storage. Our customers rarely come to our stores and have a high barrier to exit. Two elements drive the need for self storage, life events, birth, death, mobility, divorce and density of population. Therefore, as highlighted by Mark and Isabelle, having a portfolio focusing on key metropolitan areas close to dense catchment areas is an essential feature. Indeed, the majority of our customers live within 20 minutes driving time of their unit. Unsurprisingly, Baby Boomers and Generation X represent 86% of our customers. We rent units of 7 square meters on average and the monthly rent is around €140 per unit. I would now like to give you a view from the field. We strive to give our customers best in class customer experience by combining the best locations, outstanding service and a user friendly website with a convenient e rental process. Our portfolio of stores is of high quality, visible and located in dense catchment areas with presence in most key cities in our markets. We are where the people and incomes are. Our stores are managed by experienced district managers. They focus on the coaching and development of our 600 plus store and assistant store managers to deliver a great and consistent customer experience, Moving in approximately 120,000 customers a year. For most people, the experience of becoming a Shergard customer begins online. Scale and technology, specifically of our advanced website, help us to manage and improve the visibility of our brand, minimize our customer acquisition costs and offer a great experience. Our website is highly visible and comes with key brand attributes like great reviews, transparent pricing and attractive store photographs with a straightforward e rental process. Our existing customers stay with us on average 36 months. When segmenting further, using a length of stay of 12 months, We identify what we call short term and long term customers, as shown by the two wheels on the slide. Our short term customers, the left wheel, stay with us 5 months on average and represent 39% of all customers. Our responsive website combined with our data driven pricing tool allows us to maximize our revenue by ensuring we consistently attract new customers by adjusting our prices and promotion intensity to maintain a high occupancy. As shown on the right wheel, 61 percent of all customers transition to long term customers and have an average length of stay of 57 months. With unparalleled data analysis and the highly experienced pricing team, we can drive a sophisticated rate increase management tool to maximize revenue through price increases without compromising customer retention. We also continuously optimize our conversion and customer retention to industry leading proprietary systems and our well defined sales process training. Our best in class customer experience also means we continue to focus our effort on our stores, which is our product. Whilst we already have the best brand and locations with a unified store image and standardized assets, We are planning to further improve our stores' visibility to leverage our brand. A highly recognized brand combined with strong customer satisfaction, demonstrated by a 4.7 rating on Google drives leads through our website at an efficient cost. In fact, our brand name is so recognized on Google that around 50% of our paid traffic comes from branded keywords, Which represents 20% of our total paid search cost. This is a critical benefit of our unique platform when you consider our competition is spending much more to get this kind of volume. When it comes to non brand terms, We employ a data driven approach to maximize the return by leveraging our scale and relevancy. SEO or non paid searches Represent 40% of our total move ins. Here as well, brand plays an important role, But it is scale and technology that help us improve visibility and get those leads at no media cost. John, our Director of Marketing and Pricing, will now further explore with you the digitalization and innovation we are implementing to drive revenue growth. Over to you, John. Thank you, Duncan. Hi, my name is John. I've been with Chogut since 2009 and have more than 14 years of experience in marketing, brand awareness and digital user experience. As Duncan mentioned earlier and as our customers are moving more and more online, our 3 portfolio of scale, brand and technology is the winning recipe. At least 70% of our customers Are now reaching us through digital platforms. Our qualified web traffic has doubled since 2013 And mobile represents 60% of the total traffic. This is why we have built up a talented team and we're investing continuously to ensure we can maximize our revenue and the customers' experience very efficiently. The Sogut Digital team employs a sophisticated approach to web design optimization. Our capabilities to stay ahead of the game have been demonstrated with our latest eRental solution. We anticipated that E Rental would represent a significant part of our customer acquisition channels And we rolled out a solution in only a few months. We expect that in 2022, The share of our contracts coming from the web will be over 50%. So our sophisticated algorithms, Data modeling tools and providing hundreds of data points to efficiently target prospects are crucial to convert people to shortcuts. I would like to take a few minutes now to walk you through our eRental platform. This initiative is part of our vision of transforming Churgut towards a more digital company, where each customer and employee touchpoint are digitalized and its components are connected. We take a customer centric view of our business. We saw that self-service was a key feature for our customers on how to move in and when they wanted to. The pandemic accelerated the trend. The digitalization of the move in process is now fully automated, allowing the customers to select and pay for their units from the comfort of their home 20 fourseven and in about 6 minutes. From a sugar perspective, e rental is also significant. By digitizing the signing of a contract, The result is a more customer friendly process, better labor optimized with increased data quality and is more environmentally sustainable. Since it launched, our eRental platform already moved in more than 15,000 customers. It represents about 20% to 25% of all our move ins. 25% of DE Rental contracts are signed outside business hours, highlighting the greater flexibility offered to our customers. It is also encouraging to note that the e rental customer retention is the same as the other channels and we attract a younger crowd. So our integrating systems allow us to take advantage of the significant scale of our platform, providing us with a unique opportunity to leverage technology and use data as an asset. With the depth and the breadth of our underlying proprietary data and systems, we are uniquely positioned to continue to deliver the best customer experience in the market. Let's now look at why the move towards more digitalization of our business and a more data driven approach, we produce better and faster decisions. We collect a lot of valuable data through our various customer points, including also on how and when they use our properties. But the key here is not in each individual data set, but how it is all brought together in a cohesive vision. With our marketing, pricing and data scientist teams, we analyze this valuable data, allowing us to centrally monitor activity on our customers, prospects and store behaviors. On a continued basis, we run sophisticated analytics to gain unique insights, Improve customer experiences, enhance our operational processes and streamline costs. Ultimately, this all delivers exponential value to our customers, employees and shareholders. Let's talk now about how we see our technology further evolving to enhance the customer experience. The trend in using more data and technology to improve the operating model is set to continue and to accelerate. It will redefine the industry. Customers are choosing how they want to move in. E Rental now approaches 25% of the volume. Customers are letting us know this is what they want and we believe this trend will continue. What used to be a 40 minute move in transaction can now be a 6 minute experience. Going forward, We have further improvements in our sales process in sight, such as chatbots to automate most frequently asked questions and give customers an immediate answer to their query, an app to allow customers to have direct access to their accounts, but also access to the unit with a mobile and augmented reality to help our customers visualize the space they need to store the belongings. All these initiatives are geared towards enhancing customer experience and are underpinned by a centralized integrated proprietary systems, our expert teams and the capacity to use data and artificial intelligence. Now back to Duncan, We will discuss with you how we are investing in our stores and in data driven technologies to produce better and faster decisions, reduce costs, limit our consumption as well as initiatives we have to enhance brand visibility. Thank you, John. I'm very excited to share with you the various initiatives we are implementing to make our buildings more visible, more secure for our customers, but also more sustainable. Firstly, we continue to improve the visibility of our stores by predominantly using white and red on the facade and a simple and large signage with large font. It is very impactful and fits well with our initiatives on leveraging our brand. Secondly, we continue to make investments in sustainability with a goal to meet most of our needs with clean energy production. We have already converted fully to green electricity. We will also continue to reduce our gas and electricity consumption by continuing to roll out our LED and heating optimization programs across our stores. Solar panel electricity generation is currently under investigation as we are looking at adding solar where it makes sense. To reduce water consumption, we will install smart meters to better control water usage. So, our investment in technology in our buildings experience of our stores. We've updated many of our offices and we continuously upgrade floors and security. Security is a very important feature for our customers. We plan to upgrade and standardize our access control system across all our stores as well as adding more better cameras and improving 20 fourseven monitoring. We see real value in the use of AI triggered alerts to further enhance security of our stores. To support these initiatives, we are planning to spend €10,000,000 per year over 2022 to 2026, the equivalent of €7 per square meter per year. We strongly believe that these investments will allow us to be better in predictive maintenance and repair to optimize the asset life and improve operational efficiencies that ultimately will lead to an enhanced customer experience, more sustainable buildings and greater shareholder value. To conclude, the transformation and optimization of our operational platform towards more and more digitalization will have many benefits. Overall, it will lead to an improved customer experience. Our customers will have a frictionless experience through our e rental offering and they will store their belongings in more visible, more secure and more sustainable properties. Finally, Improved technology will also lead to better operating efficiency. We will use the data that we accumulate for continual process for optimization on the top line through revenue management as well as bearing down on operating costs. These current and future technology investments We'll contribute to a 2 percentage point operating margin improvement over the medium term and will continue to give us an edge in driving economies of scale in future M and A deals. And now to talk about ESG initiatives, I will turn it over to Marc and Amar. Thank you, Duncan and John. ESG has been a focus of the company for many years. Becoming a public company 3 years ago has increased the exposure of our actions and results. We have been able to improve our GRACE score to 4 stars and 78 points out of 100 for 2020. Sustainalytics Index has seen also a significant improvement with a score of 13.2 and being in the top 13% in real estate and in the top 5% globally. On top of these great achievements, we were granted a couple of awards from HIPRA for our ESG actions. Therefore, we want to do more and continue to be in the pack of leading companies for the real estate industry. Starting with the E of ESG, we are a low emission industry. If you compare Self Storage With other real estate asset classes, we are generating 5.5 kilo of CO2 per square meter per year, While hotels, healthcare, offices, retailers, residential generate at least 4 times more. Nevertheless, Shogard has reduced by almost 40% its emissions of CO2 the past 7 years within a like for like perimeter. As of January 2021, all our countries are supplied with 100% green electricity contracts 60% of our natural gas, which means a reduction of 83% of our CO2 emissions. This has been Phase 1. But we want to be more ambitious. This is why we want to go for a net zero carbon strategy with 2 additional phases: Phase 2, achieving by 2,030 an operational net zero carbon, we expect to reach this objective in part with solar panel strategy And Phase 3, achieving by 2,040 a material net zero carbon. This encompasses other carbon emissions that may be indirect, but are material to our organization, also known as Scope 3, such as emissions from our constructions and those from our corporate activities like business travel. I will now let Amar go through the social and governance part of our ESG strategy. Thank you. As Mark noted, in the short period of time that we have been public, We have made significant strides on the ESG front. This is also notable on the S front. We are strongly committed to enhancing our engagement with our employees and our communities. For our employees, you can note the progress that we have made since 2019. The development of our employees is one of the pillars that will help us achieve the goals we are discussing today. You will also note for the time and effort we are putting in to help our employees develop. The Shergarde Academy has been established to make transparent what competencies employees need to develop in order to be promoted to the next level. We also consistently check-in with employees on how the company can improve and take seriously those suggestions. Our employees clearly appreciate this, as you see from reviews from Glassdoor. SureGuard is very well rated in various metrics compared to its peers. Our commitment also extends to engagement towards our communities. Here, you note the various charities to which we have contributed both time and effort in each of our markets. You will note that the emphasis is to support children and young adults who are essential to our collective future. We will also continue our excellence in governance. Our Board is composed of a majority independent directors with broad management experience across multiple sectors, Geographies and Nationalities. The company has a monthly ESG committee that is cross departmental and includes the CEO and CFO. This committee is entrusted to implement the ESG goals of the company and recommend improvement. Ultimately, the oversight of ESG matters is one of the responsibilities of the nomination and remuneration committee of the Board of Directors. One aspect of our governance that is unique is the level of financial commitment our senior executives have in the company or what we call skin in the game. Given the large financial investment made on the part of our senior executives and directors, their interests are clearly aligned with that of our shareholders. Thank you. Now Jean will take us into how we planned on financing our growth. Thank you, Amar and Marc, for these insights on our continued efforts in improving our climate footprint, our community and employees' engagement as well as our governance. Our initiatives to increase the portfolio growth, to optimize our platform through digitalization And improve further on ESG performance will drive our total shareholder return in the coming years. Let me walk you through the growth ambitions the team presented to you and what impact it will have on the key elements of our financial model over the medium term. Our revenue will be fueled by our existing stores first. Our pricing team will continuously Apply our sophisticated data driven tools to maximize revenue and occupancy of our same store pool as well as continuing the lease up of our recent developments and acquisitions. And second, The increased activity of our development and acquisition teams will contribute to our overall revenue growth above 6%. Now let's have a look at the impact of the initiatives Duncan and John discussed today. Srogatz economies of scale, brand awareness and operational excellence will contribute to an improvement of our NOI margin of 2 percentage points over the medium terms. Our investments in the operational platform Position us in a leading place in the industry to take advantage of economies of scale to continue to digitalize the customer experience and operational processes and to consolidate our market share while delivering sustainable shareholder returns. Let's now move on future capital deployment. As explained by Isabelle and Vincent earlier on, we plan to ramp up our development from 5 to 10 properties in 2024 And we will double our bolt on acquisitions to 6 as of next year. Combined, we will add 90,000 square meters on a yearly basis at a cost of €170,000,000 with an expected yield of 7% to 8%. We expect our tax rate to stabilize at around 25% based on today's taxation rates. We will continue to maintain solid balance sheet with the LTV target of 25%, allowing us to have flexibility to deliver our growth plan while continuing to have a strong dividend policy. The final 2021 dividend per share payable in May 2022 will be unchanged based on 80% of our adjusted EPRA earnings. In 2022 and subsequent years, we will pay a dividend Per share equal to the 2021 total dividend per share level split in 2 payments in October and in May. Indeed, to fund our profitable expansion plans, our growth oriented balance sheet position us strongly to seize opportunities. At the end of August, we have a cash position of almost €300,000,000 A revolving facility of €250,000,000 and an uncommitted shelf USPP facility of €250,000,000 valid until 2024. Combined, we have around 800,000,000 Euro available to fund our expansion. However, we will continue to opt for a prudent approach. We have one of the strongest balance sheets in the industry. It has demonstrated its benefits. We proved our ability to access capital markets throughout the cycles and to raise capital at low cost as demonstrated by our latest unsecured €300,000,000 green notes with a 1.25% coupon for 10 year maturity. We maintain our LTV target at 25% over the medium term with a maximum of 35%. Shareholders and investors should see our strong balance sheet combined with a proven track record in operational execution as a unique platform ready to take investment opportunities to further consolidate our market leadership position. In summary, we will deliver an attractive total shareholder return, First, by improving the profitability of our existing stores through advanced revenue management techniques And further digitalization of our operating platform. 2nd, by deploying €170,000,000 a year at a 7% to 8% yield to grow the portfolio We believe our strategy of using cash flow towards delivering more square meters, underpins Thank you, Jean. I would like to conclude this presentation by wrapping up the key messages that have been shared with you. First, it is time for a new chapter for our company. 2nd, we want to grow more and faster and improve our profitability by leveraging our digitalization and scale with a strong financing frame and deliver an attractive shareholder return every year. Finally, all these actions will be embedded into an ambitious ESG strategy rollout for the coming years. I thank you for your attention and your great interest in our company. The team is ready to answer your questions right after a 2 minute video. How to make the best use of your storage space. Disassemble your furniture. Take apart your furniture to make it smaller and keep the screws safe in a bag attached to the frame. Disassembled furniture is much easier to store, maximizing the space in your unit so everything fits perfectly. Storage inside storage. Save space by storing smaller items inside larger ones. A fridge is a great reuse of space, so fill it with boxes, but always wedge the door open so that still circulates. Stack to the ceiling. To make the best use of your storage space, stack boxes to the ceiling. Create an aisle. Place your boxes close to the walls and make a path down the center of your unit. Place the box labels into the aisle so you can easily find what you need. Map your unit. Draw a basic map of the contents of your unit to help you find items again quickly. Tape it to the wall of the unit for reference later. This is particularly important when you really need to find those Welcome back to final Q and A session. I have with me Marc, John, Amar and Duncan. We are all in the starting blocks ready to take your questions. So our first question is from an investor and it's for you Duncan. You expect that the new generation will need less self storage as they're adopting the recycling and sharing economy. Thank you, Jean. Very important question to start with. The The answer is that we don't see any impact on the demand for self storage. And there are a number of reasons for that, and I will take you through 3 of the most important ones. First of all, of course, we've all talked about life events during the course of this presentation. Life events, birth, death, Divorce Mobility, we'll continue that we'll continue to have life events and we know full well that one of the key starting prompts for many couples to start collecting stuff is the starting of a family. So thankfully for us and for Self Storage, these life events will continue. 2nd one, of course, is to do with the size of apartments. The price per square meter in apartments in all the big cities across Europe continue to rise. And therefore, apartments are becoming smaller and smaller. I'll give you an example. In Northwest London, the Grand Union development in Alperton, I was checking their new builds the other day and the bedroom in a 1 bedroom apartment is 3 meters by 2.4 meters. It's less than 10 feet by less than 8 feet. So these new apartments really are very small. And one way of getting around that, of course, for youngsters, young couples, young families is to buy a 1 bedroom apartment because that's all they can afford and then have a unit for their goods and to give them more space to expand into. And thirdly, of course, is working from home. This is a recent phenomenon which will stay with us. We know full well when we're recruiting candidates for positions within Shergar that one of the first questions now being asked Can I spend 1 or 2 days working from home? So to work from home, you need space, you need to create a home office And you need somewhere to put the stuff to create your workspace. So of course, we're helping with that and that will continue to be a positive trend for our industry. So combine all those together, we can certainly see that the demand for self storage will remain strong. Thank you, Duncan. I have now a question from Herman van der Loos at Degroof Petercam. Do you expect Google cost to continue to go up and at what rate? I guess this one is for you, Jean. Okay. Thank you, Jean. Yes, indeed, I mean, we do expect the cost per click on the all these search bidding On the search engines, which as you know is mainly Google. I mean big chunk of the marketing expense today of the large sales force players Related to Google, then yes, so we do expect the cost per click to increase. But as Duncan explained to you in the early part of the Section 2, There are ways to offset part of it. I mean, we talked about improvement of the website, improving the digital awareness, Driving more people, more online visitors to the SEO medium, which is basically the nonpaid click. So all these initiatives we have, yes, certainly, I mean, we talked about also the strong customer satisfaction highlighted by the 4.7 Star rating on Google. So all these initiatives we have and actually the results really today, obviously, I mean, we expect them to drive more leads to our website in a cost efficient way. And we also show the difference between the cost per click of the branded keywords and the generic keywords. So all this, obviously, I mean, we are using this to offset part of the increase of the cost per click. And maybe to conclude, we have some time. And to tie back to the other section of Isabelle and Duncan and Duncan, sorry, and Vincent. So having also the greater platform of stores, obviously, should also help us kind of contain those marketing costs At Pay, because indeed, we will be able to further increase our economies of scale by spreading out all these marketing costs on a bigger Thank you, John. Thanks, John. Another question from Hermann. He's wondering about alternative competition. Do we see them as a threat, such as alternative competitors, such as like or competition, such as friends, Containers, pickup and delivery, these type of competitors. Duncan, any view on that? Yes, Jean. Well, of course, these disruptors have been around for quite some time. Peer to peer storage or valet storage is not new. And clearly, by the results that we can demonstrate and our peers in self storage, they are a slightly different part of the business. And therefore, we don't consider them to be a major threat to what we do and to our growth potential. And there are a number of factors that come into consideration when you're looking at these disruptors. Of course, logistics is a large part of it. These valet storage companies are primarily logistics companies. It's It's a matter of how do you move items around efficiently and cost effectively. There's access, of course. I mean, self storage is accessible to our customers 7 days a week. And therefore, they can come down and Whenever they want, if it's valet storage or even peer to peer, then that may not be the case. And of course, particularly with peer to peer storage, is it safe? Is it secure? We know that with self storage, You as the contract holder, you're the only person with access to that unit, whereas if you're storing stuff through peer to peer in somebody else's There's room that can never be assured. So we believe that the disruptors are not a significant threat to our growth potential at all. Thank you, Duncan. And Amar, an investor is asking how has the hiring environment being impacted by the pandemic and how do you see it going forward? Yes, that's a good question. Thank you, Jean. Initially, when countries were opening up and companies were trying to get back to normal, there was A lot of competition for talent. But we're seeing now as various furlough schemes are ending And people have to get back to as much normal as possible and are reentering the workplace. That Competition is not as much as it was on the last few months, but nonetheless, it's still there. So unquestionably, it's still an employee's market out there. But as Duncan had mentioned a little bit earlier, the focus of a lot of candidates these days are more about the work life balance and the quality of life. And fortunately, that's something that we offer at Sugar. Thank you. Kakalos from Berenberg is asking, do you aim in the pipeline for larger exposure to commercial tenants? If so, would this require a different foreplay or design for our properties? Marc, do you want to take that? Yes, sure. Thank you, Jean. So no, we are not planning to change the mix that we have in our current properties and the future ones related to a share that could be different for commercial customers. For the time being, we are on 80% residential and 20% what we call business customers. And it's pretty stable. It doesn't change. So we don't foresee any change about that. Thank you, Marc. You're welcome. Next Question from an investor. What are the pros and cons of leaseholds versus freeholds for Shergard? I'll take this one. As you know, we're mainly a freehold portfolio. We prefer freehold because we believe that long term, it offers More value. It also gives us more opportunities for redevelopment. One of the lever we talk about it, it's easier to do a redevelopment when you own the assets versus when you lease it. However, we're not closing the door on leasehold. In some cities or in some certain catchment area, freehold would be very difficult or almost impossible. So certainly, we will look at leasehold in those specific areas or catchment areas. We also if we do leasehold, typically, it will be on a long term basis. We're not going to do short leasehold, but we're not completely close to leasehold. So we have a balanced approach, freehold and leasehold when freeholds are not possible. So the next question is from Andrew Gill from Jefferies. Is there any opportunity to replace natural gas with pure electricity in our assets as electricity has a stronger environmental credentials. Marc? Yes, yes, sure. Well, thank you for this ESG question. So yes, clearly, actually the technology is called heat pump. So instead of using the natural gas to heat the buildings, You use that pump, which is using the air from the outside. And to do that, you need some electricity. And the benefit of this technology is that the CO2 footprint is much better than the natural gas. So we are looking at this carefully. And we know that more or less, it's if we go for that, we are having to, let's say, adjust more or less 100 properties out of the 250 we have, and it's probably something around €5,000,000 of investment to do so. Thanks, Marc. We have another environmental question from Frederic Renard at Klepper Chagroix. The ambition to be full carbon net 0 in 2,040 is quite ambitious. Do we have any plan to reduce Well, sure. It will be, of course, a phase in time because we have an ambitious That is actually 20 years. It looks long, but it's ambitious, as said Frederic. So clearly, we are Starting already with the fact that we are using more and more potentially solar panels. On the top of that, the fact that you have also All company cars because we're talking about indirect here consumption, company cars becoming electrical, which will be the case by 2024. Plus, on the top of that, having power station poles in all our properties across Europe will help in order to get to that objective in 2,040 to be a net zero carbon company. Okay. I have a question for an investor here for Duncan. What are your thoughts on further automation of self storage? Well, automation will certainly continue. By that, I mean Utilization is clearly a path that we're moving on now very, very strongly. We've Successfully launched our e rental program in the last few months. And as John has mentioned in his presentation, we're We're fast approaching 25% of all of our move ins now come from our e rental process. That's really just a start for us. We're looking at other ways that we can digitalize and make life easier for our customers, online customer account management, for example, But also, a building management system, so that we can be much better at preempting repair and maintenance costs across our portfolio. So over time. And this will all happen relatively quickly because we started, and we're going to be putting a lot of resources into how we can Improve our operational platform in the next few years. So there's lots of potential for developing our digital platform and improving the efficiency of how we operate. Thanks, Duncan. I have a question, it'll be for me, from Frederic Renard at Kepler Cheuvreux. Why do you increase your tax rate guidance from 20% to 25%? Any reasons? The main reason, Frederic, is that We have seen that tax rates have going up in some countries compared to a couple of years ago, notably in the U. K. Where the tax rate We'll go up from 19% to 25% in the coming years. So next question is from Rob Jones at BNP Exane as well as Marc Mozzi from And both have a question on dividends. So why hold the dividend flat after 2021? Why not raise more debt and level up or raise equity at a premium? Thank you for both for that questions. So our LTV will gradually increase towards a 25% guidance. I mean, that's the main reason why we are for addressing our dividends because we see it based on our growth and deploying of capital and our growth plans Of spending €170,000,000 a year combined with continuing to pay a strong dividend to our investors, We see that we will reach that LTV target. So we are convinced that our growth approach We lead to higher return on invested capital over time, but it also allow us to retain flexibility for larger So a question from an investor here. Marc, What is your perceived biggest threat in the next chapter? Well, to me, the biggest threat is actually to make sure that the organization is not distracted in the execution of the plan, meaning that our team, starting from the executives, but and of course, the group of people you have At the beginning of this presentation, they do stay focused on what they have to do in order to execute that plan. So to me, My job is to make sure that we stay on and these numbers will come up. And similarly, Marc, What does excite you the most about the growth story we just saw today? Well, the execution with the team. So let's do it. Let's get the numbers. That's the excitement here. Thank you. And that's the last questions of the session. Okay, good. Thank you, Jean. So just I think we have come to an end of our Investor Day. And I would like to thank you for your interest and the many questions we received from you. And if we have not been able to answer to one of your questions, don't worry, we will be able to address them in the coming days through e mail. So therefore, you will get these answers. As a reminder, the Investor Day presentation, so the whole taping of that and so the recording is accessible on demand on our And I would like also to thank the speakers. So my team here with me and before that, Vincent and Isabelle and Caroline, of course, for their contribution and also other people that behind the scene have been able to make this whole day a success and a great presentation. So very happy that you get some pleasure to share with us, the next chapter of our company. So see you soon, I hope, and goodbye. Thank you.