Big Yellow Group PLC — Annual Report 2018

Mar 31, 2018

Big Yellow Group PLC

Annual Report & Accounts 2018

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WE ARE… BRITAIN'S FAVOURITE SELF STORAGE COMPANY

Building on a proven model

Big Yellow Group PLC is the UK's brand leader in self storage. We operate from a platform of 96 stores, including 22 Armadillo stores, in which the Group has a 20% interest.We also own tenmore development sites, including one extension site, and have planning consentfor three ofthem. Theirmaximumlettable area (including Armadillo) is 5.6 million square feet, but this will increase to 6.2 million when we've finished developing them. Of all these stores and sites, we hold 97% by value as freehold and long leasehold, with the other 3% short leasehold.

We have been the driving force behind modern self storage, locating along high profile, accessible main roads and using state-of-the-arttechnology in our stores. This, along with an unwavering desire to provide the best customer service, has made us by far the strongest self storage brand in Britain.

Over the following pages:

We will outline the core qualities of our business and explain what we've got planned for the future, including our pipeline for growth.

2018 WAS A SUCCESSFUL YEAR, WITH OCCUPANCY, REVENUE, CASH FLOW, EARNINGS AND DIVIDEND GROWTH.

THROUGH FOCUSING ON PROVIDING THE VERY BEST SERVICE FOR OUR CUSTOMERS, OUR BUSINESS WILL KEEP GETTING STRONGER. WE WILL KEEP MAKING THOSE SMALL IMPROVEMENTS TO OUR PRODUCT AND SERVICE WHICH HELP MAKE PEOPLE'S LIVES THAT BIT EASIER.

Delivering that little extra

Welcome

We continue to deliver year-on-year growth in all of our key operating

metrics. Since flotation, we have delivered a total shareholder return with dividends reinvested of 15% per annum.

Our momentum keeps building

WE KEEP IT SIMPLE FOR INVESTORS. OUR RESULTS SHOW WE PROVIDE SUSTAINABLE EARNINGS AND DIVIDEND GROWTH FROM A SOLID CAPITAL STRUCTURE.

Financial Highlights

	Year ended	Year ended
Financial metrics	31 March 2018	31 March 2017	Growth
Revenue	£116.7m	£109.1m	7%
Like-for-like revenue(1)	£114.7m	£107.3m	7%
Store EBITDA(1)	£79.5m	£73.5m	8%
Adjusted profit before tax(1)	£61.4m	£54.6m	12%
EPRA earnings per share(1)	38.5p	34.5p	12%
Dividend – final	15.5p	14.1p	10%
– total	30.8p	27.6p	12%
Statutory metrics
Profit before tax	£134.1m	£99.8m	34%
Cash flow from operating activities (after net finance costs)	£63.0m	£56.0m	13%
Basic earnings per share	85.0p	63.6p	34%
Store metrics
Occupancy growth(1)	179,000 sq ft	112,000 sq ft	67,000 sq ft
Closing occupancy(1)	81.0%	78.0%	3.0 ppts
Occupancy – like-for-like stores(1)	81.9%	78.0%	3.9 ppts
(1) Average net achieved rent per sq ft	£26.37	£26.16	0.8%
(1) Closing net rent per sq ft	£26.74	£26.03	2.7%

(1) See note 37 for glossary of terms

Highlights of the Year

BIG YELLOW IS WELL PLACED TO BENEFIT FROM THE GROWING APPETITE FOR SELF STORAGE, THANKS TO OUR HIGH BRAND AWARENESS AND EASY TO USE ONLINE PLATFORMS WHICH PROVIDE 88% OF ENQUIRIES.

• > Strong occupancy performance driving 7% revenue growth
• > Closing net rent up 2.7% from 31 March 2017, average rate up 0.8% year on year and up 1.5% in the second half
• > Cash flow from operating activities (after net finance costs) increased by 13% to £63.0 million
• > Adjusted profit before tax up 12% to £61.4 million
• > 12% increase in total dividend to 30.8 pence per share
• > Acquisition of new development sites in Wapping (London), Uxbridge (London), Bracknell, Hove and Slough taking pipeline to approximately 640,000 sq ft (14% of current MLA)
• > Planning consent obtained at Manchester for a landmark city centre store of 60,000 sq ft
• > Planning consent obtained at Camberwell, London for a 72,000 sq ft store
• > Refinancing extending the term of the Group's debt and reducing the average cost

The self storage brand leader with the largest online market share

A Year of Further Achievement

AS OUR VACANT CAPACITY HAS REDUCED WE HAVE BEEN MORE AGGRESSIVELY PURSUING AN EXPANSION STRATEGY.

We are firmly focussed on the future

Nicholas Vetch, Executive Chairman of Big Yellow, commented:

"We remain focussed on our core objective of increasing occupancy to 90%. As we have previously indicated, higher levels of occupancy deliver more traction on pricing and drive rate growth and indeed we have seen that materialise in the second half ofthe year.

As our vacant capacity has reduced we have been more aggressively pursuing an expansion strategy. There are very fewexisting stores that are of sufficientqualityavailabletopurchaseandbrandasBigYellow.Wecontinue therefore to acquire raw land and develop our own stores, and are pleased to have secured a number of quality sites during the year. The development process however, of which we have unparalleled experience, remains long, does carry risk, and is increasingly complex.

Risks externalto our business remain, and there will no doubt be setbacks in economic growth. It is for that reason that we keep the business very conservativelyfinancedthusenablingus toplanandexecutethenextphase of growth."

Driving occupancy, revenue and cash flow growth

Our Competitive Advantage

OUR POWERFUL NATIONWIDE BRAND MEANS WE'RE AT THE FRONT OF MANY MORE CONSUMERS' MINDS THAN OUR COMPETITORS.

The things that set us apart

• > UK self storage industry's most recognisable brand
• > Our prominent stores along main roads, with high visibility and bright yellow frontages, mean we can't be missed
• > Largest share of web traffic to UK self storage operator websites
• > Strong customer satisfaction and NPS scores reflecting excellent customer service
• > Primarily freehold sites, concentrated in London, the South East and other large metropolitan cities
• > Largest Maximum Lettable Area ("MLA") capacity of any UK self storage company (Big Yellow and Armadillo combined)
• > Larger average store capacity economies of scale and high operating margins
• > Secure financing structure with strong balance sheet

A strong brand and putting the customer at the heart of our business helps us stand out ahead of the market

Why People Choose Big Yellow

STRONG GROWTH OPPORTUNITIES FROM A VARIETY OF DIFFERENT CUSTOMER GROUPS.

Businesses

Demand for self storage comes from a number of different areas

The people of Britain need storage; possessions can get in the way of life and what it throws at us.

Housemovers come our way as they need to store in between properties. Home declutterers too, as possessions fill space-constrainedhomesandwe're usedasaspareroom.Key lifeeventsoften create a need for space; divorce, marriage, inheritance, home improvements,travelling. And then there's the students, who pay us a visit during university holidays.

We have lots of business customers too. Some use us as a stock room, with retailers, e-tailers and hospitality companies, to name a few, storing their products, documents and equipment with us. There's a growing trend towards self-employment and start-ups in the UK, meaning that we can position ourselves as the savvy option for these businesses.With no business rates for our customers to pay,flexiblestorage,littlecommitment and our helpful business services likeorganising couriers and accepting deliveries, we're a smarter choice for Britain's businesses.

Domestics 65% by space 80% by customer numbers 35% by space 20% by customer numbers 65% 35%

Overall Occupied Space 31 March 2018

OUR BUSINESS CUSTOMERS, LIKE FLORAL IMAGE (SUPPLIERS OF ARTIFICIAL FLOWERS), BENEFIT FROM OUR CLEAN, SECURE AND FLEXIBLE STORAGE PLUS OUR HELPFUL RANGE OF BUSINESS SERVICES.

People choose us because of our…

Our Unwavering Customer Focus

OUR PEOPLE LOOK AFTER OUR CUSTOMERS TO HELP THEM THROUGH STRESSFUL LIFE CHANGES SUCH AS MOVING HOME.

We put the customer at the heart of our business

We're about much more than just storage. We're about people and their possessions. Whether it's a house move, setting up a business or a DIY project, we understand these are all key life moments where it can get a bit stressful. At Big Yellow, our people help to take the stress away.We work hard to understand our customers' requirements and give the best service possible, whether it's face-toface,over the phoneor through our user-friendly onlinesupport. Ourcustomer supportcentreis also on hand seven days a week to provide an additional layer of help if people need it.

Providing the best possible customer service is atthe heart of our business; atthe end ofthe day,we existtomake people's lives easier.Wemeasure customer service standards through a programme of mystery shopping and customer feedback surveys which are externally managed. Over the year,we have achieved an average net promoter score of 80which compares favourably to other consumer businesses.

We're so confident in our service that our customer reviews are published on our website, showing an extremely high level of satisfaction. We also invite customers to submit reviews to a third party review site TrustPilot, currently averaging 9.5 out of 10.

Our supportive nature is embodied by our people

Security

WE'RE HERE TO MAKE PEOPLE'S LIVES EASIER, SO INVESTING IN STATE-OF-THE-ART SECURITY HELPS US GIVE THEM PEACE OF MIND.

We're the only major UK operator where every room in every store is individually alarmed.

Weknowhowimportant people's possessions are, sowe'verepaid their trustin us tolook after them. People store all sorts of things with us; their much loved furniture, their sentimental items and heirlooms, their business's stock. So we give their possessions the security they deserve.

Customers have unique PIN access to their storage. We've also got staff on-site seven days a week and CCTV that's monitored round the clock. Our store teams are trained to be extra vigilant for any suspicious activity.

All of our stores are modern, brightly lit and are situated in visible locations, easily accessible from main roads.

Security levels that prove we care

Our Portfolio

Outside London

– 60 stores and sites

Current maximum lettable area

640,000sq ft

Development pipeline of approximately 640,000 sq ft with an estimated cost to complete of £110 million

An extensive national network

Our presence is right across the UK and our customers like our modern, highly visible and easily accessible stores.

We want to keep growing, so we can make ourselves available to even more people who need a bit of extra space. In the past year, we've opened a second store in Guildford, built an extension at Wandsworth and acquired five more development sites at Wapping and Uxbridge in London and in Hove, Slough and Bracknell.

All of these add to our development pipeline, which spreads across London,with Kings Cross, Camberwell and Battersea as well as Manchester and Newcastle.

During the year, Armadillo acquired three stores in the North East and threestores in theSouthWest. The Groupmanages the Armadillo stores and has a 20% interest in them.

Our unrivalled portfolio gives us extensive coverage across Britain

Manchester Planning consent: Store opening date: Spring 2019	Granted
Total net storage: 60,000 sq ft
	London

The Big Yellow Foundation

WE KNOW THAT LIFE CAN SOMETIMES BOX PEOPLE IN, SO THE BIG YELLOW FOUNDATION HELPS THEM FIND THE SPACE TO GROW.

Helping vulnerable people lead brighter lives

We're really good at helping our customers when they're going through a stressful time; our whole philosophy is about making their lives easier. We wanted to extend that philosophy to the wider community.

So we set up the Big Yellow Foundation to help support charities with a similar philosophy; who work hard to help people through tough times and back into employment.We carefully selected a few that we felt were tackling particularly challenging issues in society, from supporting ex-offenders and ex-service personnel, to people with disabilities and refugees.

It's been something that both our staff and customers have got behind, as we are raising money through customer donations – which Big Yellow matches – and staff fundraising activities too. Through volunteering, we're also giving our staff the chance to provide an extra pair of hands to these charities. We're very proud to announce the Foundation was rolled out to all of our stores earlier this year.

This is a long-termcommitmentwe aremaking tothecommunitiesweoperatein.Welookforward to sharing our successes and stories with you in the coming years.

Making a difference to charities we care about Work experience and work placement opportunities are part of how we want to engage with our charity partners. Breaking Barriers for example, offers a unique approach to helping refugees in London find meaningful employment. This helps them rebuild their lives and integrate into the UK. We were able to provide a young refugee with a six month work placement at our Balham store. His English and general confidence were greatly improved and both he and the store staff found the experience very rewarding.

The Foundation was officially launched in February 2018, although we ran a pilot across 18 stores for 12 months beforehand. This allowed us to get the messaging just right. The pilot itself raised just over £45,000.

Another charity we support is Bounce Back. They are focussed on the training and employment of ex-offenders. They have an 85% success rate on people who leave prison either going into employment or further training. In addition to fundraising, our Construction team employed two Bounce Back members through our maintenance contractor to paint the interior walls of our new store in Guildford Central and our extension at Wandsworth.

Through volunteering, the Big Yellow Foundation will provide our employees with opportunities to use their own skills to help benefit our charity partners.

Many of our store teams are also setting their own money raising challenges for the Foundation.

Contents

• Chairman's Statement
• Strategic Report
• Operational and Marketing Review
• Portfolio Summary Big Yellow Stores
• Our Stores
• Portfolio Summary Armadillo Stores
• Store Performance
• Financial Review
• Principal Risk and Uncertainties
• 39 Corporate Social Responsibility Report
• 54 Independent Assurance Statement on the Corporate Social Responsibility Report
• Directors, Officers and Advisers
• Directors' Report
• Corporate Governance Report
• Report of the Nominations Committee
• Remuneration Report
• Audit Committee Report
• Statement of Directors' Responsibilities
• Independent Auditors' Report to the Members of
• Big Yellow Group PLC
• Consolidated Statement of Comprehensive Income
• Consolidated Balance Sheet
• Consolidated Statement of Changes in Equity
• Consolidated Cash Flow Statement
• Notes to the Financial Statements
• Company Balance Sheet
• Company Statement of Changes in Equity
• Company Cash Flow Statement
• Notes to the Financial Statements
• ibc Ten Year Summary

Building

on a proven model

Big Yellow Group PLC ("Big Yellow", "the Group" or "the Company"), the UK's brand leader in self storage, is pleased to announce its results for the year ended 31 March 2018.

We have delivered another year of occupancy, revenue and earnings growth. In May 2017, along with our year end results, we set out our ambition to see material growth in occupancy towards our long held target of 85%. In November, with our interim results, we adjusted our occupancy target for the business as a whole to 90%. We are therefore pleased to be reporting significant progress in occupancy with these results. Like-for-like closingGroup occupancy is up3.9percentage points to 81.9% compared to 78.0% at 31 March 2017. Closing net rent was £26.74, an increase of 2.7% fromthe same time last year. Average rental growth was up 0.8% year-on-year and up 1.5% in the second half.

Wewould expectto see further growth in occupancy overthe summer, peaking at or above 85%, providing there are no significant external shocks. It remains our firm belief that occupancy gains are hard won and are of significant value to drive long term increases in average rent. As our occupancy rises, rate growth will come through driven by our yield management systems, and we have seen that in the second half of the year, and expect to see more of a contribution to revenue from rate growth in the current year.

Financial results

Revenue for the year was £116.7 million (2017: £109.1 million), an increase of 7%. Like-for-like revenue growth (excluding Nine Elms and Twickenham 2 acquired in April 2016 and Guildford Central opened in March 2018) was 7%.

Operating cash flow increased by £7.0 million (13%) to £63.0 million for the year (2017: £56.0 million). During the year we spent £42.0 million on growth capital expenditure, more than double the £20.6 million in 2017. The Group's operating profit before property revaluations increased by £5.6 million (9%) to £70.9 million. The Group's statutory profit before tax was £134.1 million, an increase of 34% from£99.8million in the prior year due to the increase in operating profit and an increased revaluation gain on our investment properties in the year.

Given that our central overhead and operating expense is largely embedded in the business, this revenue growth has delivered an increase of 12% in the adjusted profit before tax in the year of £61.4 million (2017: £54.6 million). Adjusted earnings per share increased by 12% to 38.5p (2017: 34.5p) with an equivalent 12% increase in the dividend per share for the year.

The Group has net debt of £323.7 million at 31 March 2018 (2017: £298.0 million).This represents approximately 25% (2017: 25%) ofthe Group's gross property assets totalling £1,303.3 million (2017: £1,190.5 million) and 31% (2017: 31%) of the adjusted net assets of £1,059.1 million (2017: £963.4 million).The Group's interest cover for the year, expressed as the ratio of cash generated from operations againstinterest paidwas7.6times (2017:6.1times).This is comfortably ahead of our internal minimum interest cover target of 5 times.

Investment in new capacity

Our 55,000 sq ft Guildford Central store on Woodbridge Meadows opened inMarch 2018, and afterits firsttwomonths itis 12% occupied. The 25,000 sq ft extension to our Wandsworth store has just opened.

We have acquired five freehold development sites since 1 April 2017, increasing our pipeline to nine new stores and one extension, with a total capacity (subject to planning) of approximately 640,000 sq ft (14% of current MLA).The acquisitions in Wapping (just east ofTower Bridge), Uxbridge (West London), Hove, Bath Road in Slough, and Bracknell are all in London and the South East, and we believe when developed will be quality additions to the portfolio.

We continue to look forland and existing storage centres in large urban conurbations, with a focus on London and the South East, and should the current uncertainties throw up new opportunities, we will pursue themaggressively.That said, developing stores in these areas remains challenging given the competition for land, an increasingly long, expensive and complex planning process and the understandable pressure to produce more housing.

We have successfully acquired four of the six long leasehold interests within the Wapping building and are currently fitting out the available vacant space to create a self storage centre of approximately 25,000 sq ft, which will open in late summer.

As reported in our interims, we have obtained planning consent for a landmarkManchester city centre store of 60,000 sq ft onWater Street, which is currently under construction with a scheduled opening in spring 2019. We have also recently obtained planning consent for a 72,000 sq ft store in Camberwell, London, with the store scheduled to open in spring 2020. After lengthy consultations, we have made good progress on planning at Kings Cross and Battersea and anticipate submitting applications for both schemes later this year.

WE REMAIN FOCUSSED ON OUR CORE OBJECTIVE OF INCREASING OCCUPANCY TO 90%.

We are working up the planning applications on the recently acquired schemes in Bracknell, Slough, Hove and Uxbridge andwill submitthem in due course following negotiations with the relevant councils. As always,this process is subjectto the vagaries ofthe planning system. At 31 March 2018, the future cost of the current pipeline of ten development sites and extensions, seven of which are subject to planning, is estimated to be £110 million.

Dividends

The Group's dividend policy is to distribute 80% of full year adjusted earnings per share.The final dividend declared is 15.5 pence per share. The dividend declared for the year of 30.8 pence per share represents an increase of 12% from 27.6 pence per share last year.

Our people

A business will only succeed if it has a fully motivated and engaged team. From the start we have always aimed to create a culture which is accessible, apolitical, non-hierarchical, socially responsible, and very importantly, a fun and enjoyable place towork. Some of you may have seen thatwe formally launched The Big YellowFoundation in February, supporting six charities who focus on the rehabilitation of adults through work.This is a further step in the evolution of Big Yellow as a business,which has received very positive feedback and supportfrom our people and customers. More details on the Foundation can be found online and in the CSR report.

In addition,we focus on customer service and engagement,measuring and responding to theirfeedback.There has been a furtherimprovement in our customer net promoter scores ("NPS")to an average of 80.1 over the year. NPS scores at these levels are highly unusual and a good reflection of the culture of this business.

I would like to thank all our people for their efforts in contributing to another year of growth.

Board

Tim Clark has announced that he is stepping down as a Non-Executive Director at the Group's next AGM. He joined the Company in 2008 and over the past ten years has been a valuable Senior Independent Director, and Chair of the Remuneration and Nomination Committees. I will miss his sound advice, judgement, and considerable brainpower and along with the Board, would like to thank him for his significant contribution to Big Yellow's success.

Vince Niblett joined the Board as a Non-Executive Director and Chairman of the Audit Committee in June 2017. Vince was previously the Global Managing Partner Audit for Deloitte, and held a number of senior leadership roles there before his retirement in May 2015.

Anna Keay joined the Board as a Non-Executive DirectorinMarch 2018. Anna has been the CEO of the Landmark Trust since 2012, having started her career at Historic Royal Palaces, and then from 2002 to 2012 she was Curatorial Director of English Heritage.

I am delighted to welcome Vince and Anna. I consider it a plaudit that we can attract such high quality people to our Board.

Outlook

We remain focussed on our core objective of increasing occupancy to 90%. As we have previously indicated, higher levels of occupancy deliver more traction on pricing and drive rate growth and indeed we have seen that materialise in the second half of the year.

As our vacant capacity has reduced we have been more aggressively pursuing an expansion strategy.There are very few existing stores that are of sufficient quality available to purchase and brand asBig Yellow.We continue therefore to acquire raw land and develop our own stores, and arepleasedtohavesecuredanumberofqualitysitesduringtheyear.The developmentprocesshowever,ofwhichwehaveunparalleledexperience, remains long, does carry risk, and is increasingly complex.

Risks external to our business remain, and there will no doubt be setbacks in economic growth. It is for that reason that we keep the business very conservatively financed thus enabling us to plan and execute the next phase of growth.

Nicholas Vetch Executive Chairman 21 May 2018

Strategic Report

Our Strategic Report

discusses the following areas:

• > Our strategy and business model
• > Operational and marketing review
• > Store performance
• > Financial review
• > Principal risks and uncertainties
• > Going concern basis and viability statement
• > Corporate social responsibility

Approval

This report was approved by the Board of Directors on 21 May 2018 and signed on its behalf by:

James Gibson	John Trotman
Chief Executive Officer	Chief Financial Officer

Our Strategy and Business Model

Our Strategy

Our strategy from the outset has been to develop Big Yellow into the marketleading self storage brand, delivering excellent customer service, with a great culture and highlymotivated employees.We continue to be the market leading brand, with unprompted awareness of seven times that of our nearest competitor (source: YouGov survey, April 2018). We concentrate ondeveloping our stores inmainroad locationswithhigh visibility, where our distinctive branding generates high awareness of Big Yellow.Our accreditation in2016fortheBest100Companies towork for was pleasing as an independent assessment of our employee engagement, and our customer satisfaction survey scores remain very high,with an average customer net promoter score of80in the year, and average Trustpilot scores of 9.5 out of 10.

Self storage demand from businesses and individuals at any given store is linked in partto local economic activity, consumer and business confidence, all ofwhich are inter-related. Fluctuations in housing activity whether in the rented or owner occupied sector, are also a factor and in our view influence the top slice of demand over and above a core occupancy.The performance of our storeswas relatively resilient during the collapse in housing activity and GDP over the period 2007 to 2009, with London and the South East proving to be less volatile.

Local GDP and hence business and housing activity are greatestin the larger urban conurbations and in particular London and the South East. Furthermore, people and businesses are space constrained in these more densely populated areas. Barriers to entry in terms of competition forland and difficulty around obtaining planning are alsohighestinmore urbanised locations.

Over the last 19 years we have built a portfolio of 74 Big Yellow self storage centres, largely freehold, purpose-built and focussed on London, the South East and largemetropolitan cities.We believe that by owning a predominantly freehold estate we are insulating ourselves against adverse rent reviews and in the long term possible redevelopment of key stores by the landlord.We currently have a pipeline often freehold development opportunities (including one extension) and are looking to expand that pipeline with a view to growing the Big Yellow platform to 100 stores.

65%of our current annualised store revenuederives fromwithintheM25; for Londonand the SouthEast,the proportionof current annualised store revenue is83%. Any future external growthwill be executed in away that is likely to maintain a balance of 80% in London and the South East and 20% in regional cities.

OurBigYellowstoresareonaverage62,000sqft, comparedtoanindustry averageofapproximately46,000sqft(source:TheSelfStorageAssociation 2018 UK Annual Survey).The upside from filling our larger than average sized stores is, in our view, only possible in large metropolitan markets, whereself storagedemandfromdomesticandbusiness customers is the highest. As the operating costs of our assets are relatively fixed, larger stores in bigger urban conurbations, particularly London, drive higher revenues and higher operatingmargins.

We continue to believe that the medium term opportunity to create shareholder value will be achieved principally by increasing occupancy andnetrentpersqftinourexistingplatformtodriverevenue,themajority ofwhich flows through to the bottomline. Our key objectives remain:

• > leveraging our market leading brand position to generate new prospects,principallyfromourdigital,mobile anddesktopplatforms;
• > focusing on training, selling skills, and customer satisfaction to maximise prospect conversion and referrals;
• > growing occupancy and netrent so as to drive revenue optimally at each store;
• > maintainingafocusoncost control, sorevenuegrowthis transmitted through to earnings growth;
• > increasing the footprint of the Big Yellow platform principally through new site development and where possible existing prime freehold stores that meet our quality criteria;
• > selectively acquiring existing self storage assets into the Armadillo platform;
• > maintaining a conservative capital structure in the business with Group interest cover of a minimum of five times; and
• > producing sustainable returns for shareholders through a low leverage, low volatility, high distribution REIT.

Intheeighteenyears sinceflotationinMay2000,BigYellowhasdelivered a Total Shareholder Return ("TSR"), including dividends reinvested, of 15.0% per annum, in aggregate 1,128% at the closing price of 853p on 31March2018.This compares to6.5%perannumfortheFTSERealEstate Index and 5.0% per annum for the FTSE All Share index over the same period.Thisdemonstratesthepowerof compoundingoverthelongerterm.

Our Business Model Tried and Tested... Attractive market dynamics . UK self storage penetration in key urban conurbations remains relatively low . Limited new supply coming onto the market . Resilient through the downturn . Sector growth is positive, with increasing domestic demand Our competitive advantage . UK industry's most recognised brand . Prominent stores on arterial or main roads, with extensive frontage and high visibility . Largest share of web traffic from mobile and desktop platforms . Strong customer satisfaction and NPS scores reflecting excellent customer service . 5.6 million sq ft UK footprint (Big Yellow and Armadillo combined) . Primarily freehold estate concentrated in London and South East and other large metropolitan cities . Larger average store capacity – economies of scale, higher operatingmargins . Secure financing structure with strong balance sheet Evergreen income streams . 55,000customers froma diverse base– individuals, SMEs and national accounts . Average length of stay for existing customers of ²⁶ months . 30% of customers in stores greater than two year length of stay . Low bad debt expense (0.2% of revenue in the year) Strong growth opportunities . Opportunities to drive further occupancy growth . Yield management as occupancy increases . Densification of living and scarcity of flexible business space drives demand . Growth in national accounts and business customer base . Increasing the platform financed from internal resources . Growth in our Armadillo platform Conversion into quality returns . Freehold assets for high operating margins and operational advantage . Lowtechnology and obsolescence product,maintenance capexfully expensed . Annual compound adjusted eps growth of16% since 2004/5 (IFRS adoption year) . Annual compound cash flow growth of 16% since 2004/5

. Dividend payout ratio of 80% of adjusted eps

BIG YELLOW'S UNPROMPTED BRAND AWARENESS ACROSS THE UK IS SEVEN TIMES HIGHER THAN OUR NEAREST COMPETITOR.

The self storage market

In the recently published 2018 Self Storage Association UK Survey, only 46% of those surveyed had a reasonable or good awareness of self storage.Furthermore,only6%ofthe2,083adultssurveyedwerecurrently using self storage, orwere thinking of using self storage, in the next year. This indicates a continuedopportunityforgrowthandwithincreasinguse of self storage, together with the ongoing marketing efforts of everyone in the industry,we anticipate awarenesswill grow.

Self storage is not a commoditised product and awareness is driven largely by businesses and individuals using self storage. Consequently, the increase in awareness over time has been relatively slow, with good awareness of self storage increasing from 38% in 2014 to 46% in 2018 across the UK (source: UK SSA Survey 2018). Our YouGov Survey carried outin April2018showed higherlevels of awareness in London of63%, up from58% in 2014.

Growth in newfacilities across the industry has been largely in regional areas ofthe UK and in particularin smallertowns. In London in the year to 31March 2018,we believe therewere five newstore openings offset by three closures.

The Self Storage Association ("SSA") estimates that the UK industry is made up of approximately 1,504 self storage facilities (of which 345 are purely container operations), providing 44.6 million sq ft of self storage space,equatingto0.7sqftperpersonintheUK.This compares to9.5sqft per person in the US, 1.8 sq ft per person in Australia and 0.1 sq ft for mainland Europe, where the roll-out of self storage is a more recent phenomenon (source: FEDESSA European Self Storage Annual Survey 2017). 393 self storage facilities in the UK are held by large operators (defined as thosemanaging 10 facilities ormore),which represents 34% of the total number of self storage centres (excluding container operations), but the SSA estimate over 40% of total capacity. Given the dominance of the larger brands in the South East, we would expect the proportion ofrevenue earned by the top five operators to be in excess of 40% ofthe annual industry turnover of £750million.

Big Yellow is well placed to benefit from the growing self storage market, given the strength of our brand, and our online platformwhich delivers 88% of our prospect enquiries. Our portfolio is strategically focussed on London, the South East and large metropolitan cities, where barriers to entry and economic activity are at their highest.

KPIs

The Group's KPIs are shown in the charts on page 1.The key performance indicators of our stores are occupancy and net rent per sq ft, which togetherdrivetherevenueofthebusiness.Thesearethreekeymeasures which are focussed on by the Board, and are reported on aweekly basis. Overthe course ofthe pastfive years, both occupancy and revenue have grown significantly. Closing net rent per sq ft grew by 6.1% in the year to 31 March 2014, but decreased by 3.5% in 2015 principally reflecting the acquisitionoftheBigYellowLimitedPartnershipstores,aregionalportfolio, with a lower average netrent per sq ft. In 2016 closing netrentincreased by 2.7%, by 0.5% in 2017 and by 2.7% in the current year. Our key focus is on continuing to grow occupancy, with growth in net rent following once the stores have reached higher occupancy levels.

Adjusted profit before tax, adjusted earnings per share which drive the distributions to shareholders (as our dividend policy is to pay 80% of adjusted earnings as dividends) are also KPIs. The Group focuses on adjusted profits and earnings measures as they give a clearer underlying pictureoftheGroup'stradingperformancewithoutdistortionfromexternal factorssuchaspropertyvaluationsandthefairvalueofderivatives.Wehave deliveredcompoundadjustedepsanddividendgrowthof17%overthepast five years. Compound adjusted eps growth since 2004/5 is 16%.We have illustrated the Group's performance in these measures over the past five years on page1.

Our non-financial KPIs are the net promoter scoreswe receive fromour customers and the carbon intensity of the Group's business. The Group's net promoter score received fromits customers during the year was 80.This has increased by 33% overthe pastfive years.We believe this overall score compares very favourably with other consumer facing businesses.

The Group has reduced its carbon intensity (our carbon emissions divided by our average occupied space) by 55% over the past five years. This has been achieved through investment in renewable technology,roofmounted solar photo-voltaic systems, and LED lighting across the Group's portfolio.

Operational and Marketing Review

Overview

We now have a portfolio of 74 open and trading Big Yellow stores, with a further ten development sites including one extension opportunity. The current maximum lettable area ofthe 74 stores is 4.6 million sq ft. When fully built outthe portfoliowill provide approximately 5.3 million sq ft of flexible storage space.

In addition we part-own and manage 22 Armadillo stores which are principally located in northern UK towns and cities, and operate from a platform of 1.0 million sq ft.

Growth in new self storage centre openings, excluding container operators, overthe last six years has averaged 1% to 2% oftotal capacity per annum, down significantly fromthe previous decade. Additionally, in our core markets in London and the South East, high land values driven by competing uses such as residential, and complex planning rules, are making the creation of new supply very difficult for all operators. We believe thatwe are ina relativelystrongpositiongiventhe strengthof our balance sheet and our proven property development expertise,together with our ability to access funding to exploitthe right opportunities.

Operations

The Big Yellow store model is well established.The "typical" store has 60,000 sq ft ofMLA and takes some three to four years to achieve 85% plus occupancy. The average room size occupied in the portfolio is currently 68 sq ft, in line with last year.The store is open seven days a week and is initially run by three staff, with a part time member of staff added once the store occupancy justifies the need for the extra administrative and sales workload.

The drive to improve store operating standards and consistency across the portfolio remains a key focus for the Group. Excellent customer service is at the heart of our business objectives, as a satisfied customer is our best marketing tool. We measure customer service standards through a programme of mystery shopping and online customer reviews, which are externally managed. Over the year, we have achieved an average net promoter score of 80.

We have a team of nine area managers in place who have on average worked for Big Yellowfor 13 years.They develop and supportthe stores to drive the growth of the business.

The store bonus structure rewards occupancy performance, sales growth and cost controlthrough quarterly targets based on occupancy and store profitability, including the contribution from ancillary sales of insurance and packing materials. Information on bonus build up is circulated monthly and stores are consulted in preparing their own targets and budgets each quarter, leading to improved visibility, a better understanding of sales lines and control of operating costs.

We believe,that as a consumer-facing branded business, itis paramount tomaintain the quality of our estate and customer offering.We therefore continue to invest in preventative maintenance, store cleaning and the repair and replacement of essential equipment, such as lifts and gates. The ongoing annual expenditure is approximately £35,000 per store, whichisincludedwithincostofsales.Thisexcludesourrollingprogramme of storemakeovers,which typically take place every five years, at a cost of approximately £20,000 per store. Over the last five years we have invested £12 million in the upkeep and maintenance of our stores, all of which has been expensed in the income statement.

Demand

Demand for self storage is largely driven by need, with security, convenience, quality of product, service and location being key drivers. Awareness remains relatively lowcompared to commoditised products, such as hotelrooms or airline seats, albeititis increasing slowly year on year with increased supply, marketing spend and customer use.

We are confident that Big Yellow benefits disproportionately from this improvingmarketfor our product, due to ourmarket-leading brand and operating platform with our focus on London, the South East and large metropolitan cities. Our digital platform now accounts for 88% of our prospects, of which over half come through our mobile site.

Customers rentingstoragespacewhilstmovingwithintherentalorowner occupiedsectors represent42%ofmove-insduring theyear(2017:43%). 11% of our customerswhomoved in took storage space as a spare room for decluttering (2017: 11%). 35% of our customers used the product because some event has occurred in their lives generating the need for storage;theymaybemovingabroadforajob,haveinheritedpossessions, are getting married or divorced, are students who need storage during the holidays, or homeowners developing into their lofts or basements (2017:34%).The balance of12% of our customer demand during the year came frombusinesses (2017: 12%).

There is a growing trend towards self-employment and smaller business start-ups in the UK, dynamics that are positive for self storage. Additionally, businesses in the UK are increasingly seeking flexible office and storage space rather than longer inflexible leases. The deindustrialisation of big cities with the conversion of commercial space into residential and other uses, is also a driver for demand from the SME market seeking flexible warehouse space.

During the year,the Group commissioned an external survey to assess the impactthe average Big Yellowstore generates forits local economy. 35% of the Group's space is occupied by business customers, and the average store is home to 105 different businesses who between them employ 300 people as a direct result of their occupation. 60% of the businesses that occupy our stores are start-upswho have neverrented space anywhere else before. For over half ofthe businesses,this is the only space they rent,for others this complements their other space.The report estimated that across Big Yellow over 23,000 jobs are created working for over 7,700 businesses. In addition, average local Gross Value Added generated by Big Yellow's business customers in each store is approximately £17 million per annum, or over £1 billion nationally.

Of our occupied space today, customers who are longer stay lifestyle users, decluttering into small rooms as an extension to their accommodation, occupy 10% to 15%; 50% to 55% are using it for less than 12 months largely event driven, which could be inheritance, moving in the owner occupied or rental sector, home improvements, travelling; and the balance of 35% are businesses.

We have a dedicated national accounts team for business customers who wish to occupy space in multiple stores. These accounts are billed and managed centrally. We have four full time members of staff working on growing and managing our national account customers. The national accounts team can arrange storage at short notice at any location for our customers.Insmallertownswherewedonothaverepresentation,wehave negotiatedsub-contractarrangementswithotheroperatorswhomeetcertain operatingstandards.

Marketing and ecommerce

Our marketing strategy focuses on driving enquiries and customer satisfactionthroughourdigitalplatforms.

For the last 12 years, we have commissioned a YouGov survey to help us monitor ourbrandawareness. Inourmostrecent surveyconductedinApril 2018, we used a statistically robust sample size of 1,000 respondents in Londonand2,003fortherestoftheUK.Thesurveyhasshownourprompted awarenesstobeat71%inLondon,overtwoandahalftimeshigherthanour nearest competitor and 46% forthe rest ofthe UK, overthree times higher thanournearest competitor.

Forunpromptedbrandawareness,ourrecallinLondonis46%,sixandahalf timeshigherthanournearestcompetitorandfortherestoftheUKitis23%, nearly eight times higher than our nearest competitor.The UK Self Storage Association ("SSA") has also conducted a brand awareness survey with similarresults.AccordingtotheirYouGovsurveyconductedinJanuary2018, Big Yellow's unprompted brand awareness across the UK is seven times higherthanournearestcompetitor.Thesesurveyscontinuetoproveweare theUK'sbrandleaderinself storage.

The Big Yellow website, whether accessed by desktop, tablet or smartphone, delivers the largest share of our prospects, accounting for 88% of all sales leads across the year ended 31 March 2018.Telephone is the first point of contactfor 8% of our prospects andwalk in enquiries, where we have had no previous contact with a prospect, represent 4%.

We have the largest online market share of web visits to self storage companywebsites in the UK. Across the year ended 31March 2018, our online market share of web visits ranged from 28% to 34%. Our nearest competitor ranged from 18% to 24% online market share for the same period (source: ConnexityHitwise 35 largest UK self storage operators).

We monitor and improve the website user journeys on an ongoing basis. We are committed to making the experience as easy, intuitive and informative as possible for our customers. Both themobile specific website, which itself accounted for 53% of our web visits in the year, and our desktop site are designed with helpful and time saving online tools such as Check-in Online, online FAQs, video store tours, online chat, BoxShop and a Click and Collect service for packing materials. These all help the customer to make an informed choice about their self storage requirements.

Online customer reviews

Consistent with our strategy of putting the customer at the heart of our business, our online customerreviews generate real-time feedback from customers as well as providing positive word of mouth referralto our web visitors. Through our 'Big Impressions' customer feedback programme, we ask our new customers to rate our service. With the users' permission, we then publish these independent reviews on the Big Yellow website.There are currently over 23,000 ofthese customer reviews published averaging 4.8 out of 5.

The Big Impressions programme also generates customerfeedback on their experience when they move out of a Big Yellow store and also from those prospects who decided not to store with us. This programme reinforces best practice of customer service at our stores where customer reviews and mystery shop results are transparently accessible at all levels.

We also gain real-time customer insight from over 3,800 Google Reviews averaging 4.5 out of 5 and 1,100 TrustPilot Reviews currently averaging 9.5 out of 10.

We regularly monitor any mentions of Big Yellow within all customer reviews, on social media, external blogs, news sites and across the web generally.We use this insighttomonitor our brand and continually improve our service offering.

Driving online traffic

Self storage is a consumer facing business and the development of strong, sustainable brands ismulti-layered and requires a consistency of product, customer service and interaction at all touch points, particularly online, which represents 88% of our total enquiries.

Searchengines are themostimportant acquisitiontoolforus, accounting for the majority of traffic to our website.We continue to invest in search engineoptimisation("SEO")techniquesbothonandoffthesite.Thishelps us tomaintainhighpositions forthemostpopular andmost searchedfor self storage related search terms in the organic listings on Google. Ofthe top 100 self storage search terms, 47 feature brands, representing approximately 50% of the search traffic (source: Connexity Hitwise, 12 weeks ended 12 May 2018).This clearly indicates, that although self storage is a relatively immature industry with 70% to 75% of customers using it for the first time, brand is important in driving higher levels of prospects and customer referrals, leading to improved operational performance. We have demonstrated this through significant improvements in performance of existing storage centres following their acquisition,rebranding and assimilation into our business.

The sponsored search listings remain the largest source of paid for traffic andwe ensure our prominence in these listings is balancedwith effective landing pages to maximise website conversion.

Efficiencies inonline spend are continuing into the year ending31March 2019, ensuring the return on investment is maximised from all of our different online traffic sources.Onlinemarketingbudgetswill continue to remain focussed on themediawith the bestreturn on investment.

Social media

Socialmedia continues to be complementary to our existingmarketing channels. Our activity is most focussed on Twitter and Facebook, not onlymonitoring and answering queries regarding self storage, but also publishing our own creative posts, advice, news and CSR initiatives.

The Big Yellow YouTube channel is used to showcase our stores to web prospects througha videostoretour.Weusebothdomestic andbusiness versions to help prospects experience the quality ofthe productwithout the need for them to visit the store in person. Our online blog is updated regularly with tips and advice for homeowners and businesses, as well as summaries of our charitable and CSR initiatives. We have also developed our LinkedIn profile to help promote Big Yellow as an inviting and engaging place towork and as a directrecruitment channel.

PR

We have been developing regional PR stories throughout the year to help raise the awareness of Big Yellow and the benefits of self storage across the UK. We have been highlighting newsworthy stories of charitable endeavours from Big Yellow staff or the support we provide to the local charities through offering free storage.

Budget

During the year the Group spent approximately £4.7 million on marketing (4% of total store revenue). We have increased the budget for the year ahead to £5.3 million with a focus on delivering and converting more prospects to our stores from our digital channels.

Cyber security

The Group receives specialist advice and consultancy in respect of cyber security and we have dedicated in-house monitoring. We continue to investin and reviewour security systems andwe limitthe retention of customer data to the minimum requirement. Some of the changes include more frequent penetration testing of internet facing systems, adding components such as anti-ransomware as well as the maintenance and replacement of components (such as firewalls) to the latest technology and specification. Policies and procedures are underregularreviewand benchmarked againstindustry best practice by our consultants. These policies also include defend, detect and response policies. We have aligned our policies and procedures to ensure our compliance with the new EU General Data Protection Regulation ("GDPR") which comes into effect on 25 May 2018.

Strategic Report (continued)

Portfolio Summary – Big Yellow Stores

	2018		2017
	Mature(1)	Established	Developing	Total	Mature	Established	Developing	Total
Number of stores	67	4	3	74	67	4	2	73
At 31 March:
Total capacity (sq ft)	4,157,000	271,000	178,000	4,606,000	4,157,000	271,000	123,000	4,551,000
Occupied space (sq ft)	3,417,000	223,000	90,000	3,730,000	3,271,000	213,000	67,000	3,551,000
Percentage occupied	82.2%	82.3%	50.6%	81.0%	78.7%	78.6%	54.5%	78.0%
Net rent per sq ft	£26.96	£26.08	£19.88	£26.74	£26.16	£25.29	£18.63	£26.03
For the year:
REVPAF(2)	£25.55	£24.71	£14.51	£25.19	£24.11	£22.47	£9.45	£23.62
Average occupancy	82.0%	80.8%	43.6%	81.4%	78.2%	75.6%	40.7%	77.1%
Average annual rent psf	£26.55	£26.00	£19.59	£26.37	£26.33	£25.27	£19.03	£26.16
	£000	£000	£000	£000	£000	£000	£000	£000
Self storage income	90,495	5,694	1,528	97,717	85,469	5,179	952	91,600
Other storage related income(3)	15,243	918	333	16,494	14,162	822	205	15,189
Ancillary store rental Income	435	84	5	524	432	88	6	526
Total store revenue	106,173	6,696	1,866	114,735	100,063	6,089	1,163	107,315
Direct store operating costs
(excluding depreciation)	(30,451)	(1,948)	(760)	(33,159)	(29,088)	(1,885)	(744)	(31,717)
(4) Short and long leasehold rent	(2,101)	–	–	(2,101)	(2,126)	–	–	(2,126)
Store EBITDA(5)	73,621	4,748	1,106	79,475	68,849	4,204	419	73,472
Store EBITDA margin	69.3%	70.9%	59.3%	69.3%	68.8%	69.0%	36.0%	68.5%
Deemed cost	£000	£000	£000	£000
To 31 March 2018	531,198	55,300	32,919	619,417
Capex to complete	1,700	–	800	2,500
Total	532,898	55,300	33,719	621,917

(1) The mature stores have been open for more than six years at 1 April 2017. The established stores have been open for between three and six years at 1 April 2017 and the developing stores have been open for fewer than three years at 1 April 2017.

(2) See glossary in note 37.

(3) Packing materials, insurance and other storage related fees.

(4) Rent for seven mature short leasehold properties accounted for as investment properties and finance leases under IFRS with total self storage capacity of 420,000 sq ft, and a long leasehold lease-up store with a capacity of 64,000 sq ft. The EBITDA margin for the 60 freehold mature stores is 72%, and 49% for the seven leasehold mature stores.

(5) The table below reconciles Store EBITDA to gross profit in the income statement.

	Year ended 31 March 2018		Year ended 31 March 2017
		£000			£000
			Gross profit			Gross profit
	Store	Reconciling	per income	Store	Reconciling	per income
	EBITDA	items	statement	EBITDA	items	statement
Store revenue/Revenue(1)	114,735	1,925	116,660	107,315	1,755	109,070
Cost of sales(2)	(33,159)	(2,515)	(35,674)	(31,717)	(2,358)	(34,075)
(3) Rent	(2,101)	2,101	–	(2,126)	2,126	–
	79,475	1,511	80,986	73,472	1,523	74,995

(1) See note 3 of the financial statements, reconciling items are management fees and non-storage income.

(2) See reconciliation in cost of sales section in Financial Review on page 30.

(3) The rent shown above is the cost associated with leasehold stores, only part of which is recognised within gross profit in line with finance lease accounting principles. The amount included in gross profit is shown in the reconciling items in cost of sales.

Our Stores

AN UNRIVALLED PORTFOLIO OF STORES ACROSS LONDON, THE SOUTH EAST AND OTHER LARGE METROPOLITAN CITIES.

Our Portfolio

unrivalled in the UK

Guildford Central, March 2018 MLA – 55,000 sq ft		Twickenham 2, April 2016 MLA – 22,000 sq ft		MLA – 65,000 sq ft	Nine Elms, April 2016
Cambridge, January 2016 MLA – 60,000 sq ft		Enfield, April 2015 MLA – 60,000 sq ft		MLA – 69,000 sq ft	Chester, February 2015
Oxford 2, July 2014 MLA – 35,000 sq ft	MLA – 70,000 sq ft	Gypsy Corner, April 2014	Chiswick, April 2012 MLA – 75,000 sq ft		New Cross, February 2012 MLA – 62,000 sq ft
Stockport, September 2011 MLA – 65,000 sq ft	Eltham, April 2011 MLA – 70,000 sq ft		Camberley, January 2011 MLA – 68,000 sq ft		High Wycombe, June 2010 MLA – 60,000 sq ft

Our Stores (continued)

Reading, December 2009 MLA – 62,000 sq ft	Sheffield Bramall Lane, September 2009 MLA – 60,000 sq ft	Poole, August 2009 MLA – 55,000 sq ft	Nottingham, August 2009 MLA – 67,000 sq ft
Edinburgh, July 2009 MLA – 63,000 sq ft	Twickenham, May 2009 MLA – 73,000 sq ft	Liverpool, March 2009 MLA – 60,000 sq ft	Bromley, March 2009 MLA – 71,000 sq ft
Birmingham, February 2009 MLA – 60,000 sq ft	Sheen, December 2008 MLA – 64,000 sq ft	Sheffield Hillsborough, October 2008 MLA – 60,000 sq ft	Kennington, May 2008 MLA – 66,000 sq ft
Merton, March 2008 MLA – 70,000 sq ft	Fulham, March 2008 MLA – 139,000 sq ft	Balham, March 2008 MLA – 60,000 sq ft	Barking, November 2007 MLA – 64,000 sq ft
Ealing, November 2007 MLA – 57,000 sq ft	Sutton, July 2007 MLA – 70,000 sq ft	Gloucester, December 2006 MLA – 50,000 sq ft	Edmonton, October 2006 MLA – 75,000 sq ft

Bristol Ashton Gate, July 2006 MLA – 61,000 sq ft	Finchley East, May 2006 MLA – 54,000 sq ft	Tunbridge Wells, April 2006 MLA – 57,000 sq ft
North Kensington, December 2005 MLA – 51,000 sq ft	Leeds, July 2005 MLA – 76,000 sq ft	Beckenham, May 2005 MLA – 71,000 sq ft
Watford, August 2004 MLA – 64,000 sq ft	Swindon, April 2004 MLA – 53,000 sq ft	Orpington, December 2003 MLA – 64,000 sq ft
		West Norwood, January 2003
MLA – 54,000 sq ft	MLA – 62,000 sq ft	MLA – 57,000 sq ft
	Chelmsford, April 2003	Finchley North, March 2003

Our Stores (continued)

New Malden, May 2002	Hounslow, December 2001	Battersea, December 2001	Ilford, November 2001
MLA – 81,000 sq ft	MLA – 54,000 sq ft	MLA – 34,000 sq ft	MLA – 58,000 sq ft
Cardiff, October 2001	Portsmouth, October 2001	Norwich, September 2001	Dagenham, July 2001
MLA – 74,000 sq ft	MLA – 61,000 sq ft	MLA – 47,000 sq ft	MLA – 51,000 sq ft
Wandsworth, April 2001	Luton, March 2001	Southend, March 2001	Staples Corner, March 2001
MLA – 72,000 sq ft	MLA – 41,000 sq ft	MLA – 57,000 sq ft	MLA – 112,000 sq ft
Romford, November 2000	Milton Keynes, September 2000	Cheltenham, April 2000	Slough, February 2000
MLA – 70,000 sq ft	MLA – 61,000 sq ft	MLA – 50,000 sq ft	MLA – 67,000 sq ft
Hanger Lane, October 1999	Oxford, August 1999	Croydon, July 1999	Richmond, May 1999
MLA – 66,000 sq ft	MLA – 33,000 sq ft	MLA – 80,000 sq ft	MLA – 35,000 sq ft

Portfolio Summary – Armadillo Stores

	2018	2017
Number of stores(1)	22	16
At 31 March:
Total capacity (sq ft)	963,000	738,000
Occupied space (sq ft)	712,000	551,000
Percentage occupied	73.9%	74.7%
Net rent per sq ft	£16.97	£16.51
For the year:
REVPAF	£15.09	£14.31
Average occupancy	76.0%	73.3%
Average annual rent psf	£16.61	£16.36
	£000	£000
Self storage income	10,677	8,781
Other storage related income	2,015	1,659
Ancillary store rental income	72	43
Total store revenue	12,764	10,483
Direct store operating costs (excluding depreciation)	(5,003)	(4,222)
Leasehold rent	(497)	(411)
Store EBITDA(2)	7,264	5,850
Store EBITDA margin	56.9%	55.8%
Cumulative capital expenditure	£m
To 31 March 2018	69.1
To complete	0.5
Total capital expenditure	69.6

(1) Armadillo acquired three stores in April 2017 from Quickstore in Exeter, Torquay and Plymouth, one store in December 2017 from Store it 4U in Stockton, and two stores in March 2018 from 1st Storage Centres in Newcastle and Gateshead.

(2) Store earnings before interest, tax, depreciation, amortisation, and management fees charged by Big Yellow to the Armadillo portfolios (see note 27).

Strategic Report (continued)

Store Performance

Prospects for the year were broadly in line with last year, but we converted a higher proportion of those prospects into customers, with move-ins up 3% on the prior year. This reflects the occupancy focus over the period, with continued innovation and investment in our digital platform and operations.

The table below shows the quarterly move-in and move-out activity over the year.

Store move-ins	Total move-ins Year ended 31 March 2018	Total move-ins Year ended 31 March 2017	%	Total move-outs Year ended 31 March 2018	Total move-outs Year ended 31 March 2017	%
April to June	20,332	19,509	4	15,112	15,625	(3)
July to September	21,463	20,702	4	22,952	22,239	3
October to December	16,000	15,409	4	18,190	17,679	3
January to March	16,133	16,095	–	15,273	14,468	6
Total	73,928	71,715	3	71,527	70,011	2

In the quarter to June, we saw a solid increase in move-in activity of 4%. Move-outs were down year on year, following lower activity levels in the second half ofthe year ended 31March 2017.Move-ins continued to outperform year-on-yearin the second and third quarters, although move-outs also increased following the earlier improvement in movein activity,with a high volume of student move-outs in September and October. In the fourth quarter, move-in activity was impacted by the poor weather coupled with an early Easter delaying some activity into April.

In all Big Yellow stores, the occupancy growth in the current year was 179,000 sq ft, against an increase of 112,000 sq ft in the prior year.

Quarterly net occupancy movement	Net sq ft Year ended 31 March 2018	Net sq ft Year ended 31 March 2017	Net move-ins Year ended 31 March 2018	Net move-ins Year ended 31 March 2017
April to June	183,000	110,000	5,220	3,884
July to September	82,000	24,000	(1,489)	(1,537)
October to December	(170,000)	(137,000)	(2,190)	(2,350)
January to March	84,000	115,000	860	1,547
Total	179,000	112,000	2,401	1,544

We had a strong quarter to June with an increase in occupancy of 183,000sqft,significantlyupontheprioryear,whichhadbeenaffectedby uncertainty in the run-up to the Brexit referendum. The second quarter peaked in August and then many of our students and short term house movers vacatedinSeptember andOctober, leading to anetloss inoccupied rooms and sq ft occupancy. The third quarter showed a higher loss in occupancythantheprioryearduetothestrongsummer'stradingwhichled to an increase in move-out numbers. In the final quarter we have seen a return to growth in net occupied rooms and increased occupancy in the stores by 84,000 sq ft,whichwas slightly softerthan the prior yearforthe reasonsexplainedabove.

The67mature stores are82.2%occupied compared to78.7%atthe same time last year.The four established storeshave growninoccupancy from 78.6% to 82.3%. The three developing stores added 23,000 sq ft of occupancy inthe yearto reach closing occupancy of50.6%.Overall store occupancy has increased in the year from 78.0% to 81.0%. On a like-forlike basis, excluding Guildford Central, which opened in March 2018, closing occupancy was 81.9%, an increase of 3.9 percentage points.

With the exception of Guildford Central(which opened inMarch 2018), all of the stores open at the year end are trading profitably at the EBITDA level. The table below shows the average key metrics across the store portfolio (from the Portfolio Summary on page 20) for the year ended 31 March 2018:

	Mature stores	Established stores	Developing stores	All stores
Average store capacity	62,040	67,750	59,330	62,240
Average sq ft occupied per store at 31 March 2018	51,000	55,750	30,000	50,400
Average % occupancy	82.2%	82.3%	50.6%	81.0%
Average revenue per store (£000)	1,585	1,674	622	1,550
Average EBITDA per store (£000)	1,099	1,187	369	1,074
Average EBITDA margin	69.3%	70.9%	59.3%	69.3%

Pricing and net rent per sq ft

Our core proposition remains a high quality product, competitively priced, with excellent customer service, providing value for money to our customers.We offer a headline opening promotion of 50% off for up to the first 8 weeks, and we continue to manage pricing dynamically, taking account ofroomavailability, customer demand and local competition.

Over the past eighteen months we have been more aggressive with our pricing strategy to drive occupancy growth,which led to a reduction in net achievedrentpersqftinthesecondhalfofthepriorfinancialyear.Following this fall inthe period toMarch2017, andhence a lower starting pointinthis financial year, rate stabilised in the first half of the financial year with no average rate growth. In the second half, we achieved period on period average rate growth of 1.5% and as a result the average increase for the financialyearwas0.8%.Net achieved rent per sq ft at31March2018grew by2.7% overthe financial year.

Our pricingmodelreduces promotions and increases asking priceswhere individual units are in scarce supply.This lowering of promotions, coupled withpriceincreasestoexistingandnewcustomers, leadstoanincreasein achieved netrents. Rental growth can also be driven through sub-dividing largerrooms into smallerrooms,whichyieldahighernetrentper sqft.The table belowshows the growth in netrent per sq ftforthe portfolio overthe year(excludingGuildford Central).

Average occupancy in the year	Number of stores	Net rent per sq ft growth over the year
0 to 75%	10	0.8%
75 to 80%	20	3.2%
80 to 85%	29	3.5%
Above 85%	14	3.5%

Armadillo Self Storage

TheGrouphasa20%investmentinArmadilloSelfStorage,withthebalance of 80% held by an Australian consortium. During the year Armadillo acquired six stores, three stores in April 2017 from Quickstore in Exeter, Torquay and Plymouth, one store in December 2017 from Store it 4U in Stockton, and two stores in March 2018 from 1st Storage Centres in Newcastle and Gateshead.

This takes the Armadillo platformto 22 stores and 963,000 sq ft ofMLA. As with the other existing store acquisitions, the intention will be to upgradeandreconfigurethestoresthroughadditional investmenttodrive cash flow growth. In the year to 31 March 2018, £1.5 million of capital expenditure has been invested to upgrade and fit out additional capacity in the Armadillo stores.

Armadillo is a lower-frills brand, with largely freehold conversions of existingbuildings.Theyarelocatedintownswherewewouldnottypically locate a Big Yellow, and have an average capacity of 44,000 sq ft(lower than the 62,000 sq ft average forBig Yellowstores). Armadillo provides a number of operational advantages to theGroup, such as awider platform to sellto national accounts, more opportunities for staff promotion, and more efficient use of the Company's marketing and central overhead costs. The Group continues to look for opportunities to add to the Armadillo platform.

Development pipeline

We opened our 55,000 sq ft Guildford Central store inMarch 2018, and the 25,000 sq ft extension to our Wandsworth store has recently opened.We own a further ten development sites for which planning is to be negotiated, including an existing store where planning is being soughtto extend and redevelop.The status ofthe Group's development pipeline is summarised in the table overleaf:

Strategic Report (continued)

Store Performance (continued)

Site	Location	Status	Anticipated capacity
Manchester	Prime location on Water Street, central Manchester	Planning consent granted in September 2017. Store construction started in March 2018,with a viewto opening in Spring 2019.	60,000 sq ft
Camberwell, London	Prominent location on Southampton Way	Planning consent recently granted. Construction due to start in November 2018 with a view to opening in Spring 2020.	72,000 sq ft
Kings Cross, London	Prominent location on York Way	Planning application currently being prepared to be submitted in Summer 2018.	115,000 to 120,000 sq ft
Bracknell	Prime location on Ellesfield Avenue	Site acquired in February 2018. Application to be submitted in late summer to incorporate self storage and other occupiers.	60,000 to 65,000 sq ft
Slough	Prominent location on Bath Road	Site acquired in November 2017. Planning application to be submitted in late 2018.	50,000 sq ft
Battersea, London	Prominent location on junction of Lombard Road and York Road (South Circular)	Potential redevelopment to increase size of existing 34,000 sq ft Big Yellow store. Redevelopment of adjoining retail into a mixed use residential led scheme. Ongoing detailed planning discussions with the Borough Council with the aim of submitting an application later this year.	Up to an additional 40,000 sq ft
Wapping, London	Prominent location on The Highway	Site acquired inMay2017.We are currently converting the vacant units into a25,000sq ft self storage centre, and collecting income fromthe remaining short-let tenancies.The store will open in summer 2018.	50,000 to 75,000 sq ft
Uxbridge, London	Prominent location on Oxford Road	Site acquired in April 2018. Planning application to be submitted in Autumn 2018.	55,000 sq ft
Hove	Prominent location on Old Shoreham Road	Site acquired in April 2018. Planning application to be submitted in Autumn 2018.	55,000 to 60,000 sq ft
Newcastle	Prime location on Scotswood Road	Planning application to be submitted in Autumn 2019.	60,000 sq ft
Total			617,000 to 657,000 sq ft

The capital expenditure currently committed for the financial year ended 31 March 2019 is approximately £22 million, which includes the completion of the acquisitions of Hove and Uxbridge, and construction costs on Manchester, Camberwell and Wapping.

The Group manages the construction and fit-out of its stores in-house, as we believe it provides both better control and quality, and we have an excellent record of building stores on time and within budget.

Financial Review

LIKE-FOR-LIKE REVENUE FOR THE YEAR WAS £114.7 MILLION, AN INCREASE OF 7% FROM THE PRIOR YEAR.

Delivering Results

Financial results

Revenue

Totalrevenuefortheyearwas£116.7million,anincreaseof£7.6million(7%) from £109.1 million in the prior year. Like-for-like revenue forthe year was £114.7 million, an increase of 7% from the prior year(2017: £107.3 million), principally driven by an increase in the average occupancy of the Group's stores. Like-for-like revenue excludes Nine Elms and Twickenham 2,which wereacquiredinApril2016andGuildfordCentral,whichopenedinMarch2018.

Other sales (included within the above), comprising the selling of packing materials,insuranceandstoragerelatedcharges,represented16.9%ofstorage incomefortheyear(2017:16.6%)andgeneratedrevenueof£16.5millionfor theyear,up9%from£15.2millionin2017.

TheotherrevenueearnedbytheGroupismanagementfeeincomefromthe Armadillo Partnerships, and tenant income on sites where we have not started development.

Operating costs

Cost of sales is principally comprised of the direct store operating costs, including store staff salaries, utilities, business rates, insurance, a full allocation ofthe centralmarketing budget and repairs andmaintenance.

The breakdown ofthe portfolio's operating costs compared to the prior year is shown in the table below:

Category	Year ended 31 March 2018 £000	Year ended 31 March 2017 £000	% change	% of store operating costs in 2018
Cost of sales (insurance and packing materials)	2,663	2,391	11%	8%
Staff costs	8,740	8,572	2%	26%
General & Admin	1,187	1,196	(1%)	4%
Utilities	1,447	1,470	(2%)	4%
Property rates	10,438	10,044	4%	32%
Marketing	4,656	4,152	12%	14%
Repairs / Maintenance	2,595	2,539	2%	8%
Insurance	921	893	3%	3%
Computer costs	494	443	12%	1%
Irrecoverable VAT	18	17	6%	0%
Total per portfolio summary	33,159	31,717	5%

Operatingcostspertheportfoliosummaryhaveincreasedby£1.4million (5%), £0.5 million of which relates to our continued investment in marketingtomaintaintheGroup'sonlinemarketshareandenquirylevels. Followingthe2017ratingreview,wecalculatedinMay2017thattheimpact on the Group's rates bill for the year ending 31 March 2018 would be an increaseof9%(£0.9million).Theactualincreasefortheyearat4%islower as a result of rates rebates received attwo of our stores in respect ofthe previous rating period toMarch 2017.

The cost of insurance and packing materials varies with sales and has increasedby11%,9%ofwhichistheincreaseinsalesvolume,withthebalance due to an increase in IPT, and some cost inflation. Our investment in LED lighting has contributed to a reduction in our utility expenditure.The other increasesinstoreoperatingcostsareinflationary.

Strategic Report (continued)

Financial Review (continued)

The table below reconciles store operating costs per the portfolio summary to cost of sales in the income statement:

	Year ended 31 March 2018 £000	Year ended 31 March 2017 £000
Direct store operating costs per portfolio summary (excluding rent)	33,159	31,717
Rent included in cost of sales (total rent payable is included in portfolio summary)	1,109	1,196
Depreciation charged to cost of sales	439	489
Prior year VAT recovery	–	(278)
Head office and other operational management costs charged to cost of sales	967	951
Cost of sales per income statement	35,674	34,075

Store EBITDA

Store EBITDA forthe yearwas £79.5million, an increase of £6.0million (8%) from £73.5 million for the year ended 31 March 2017 (see Portfolio Summary).The overall EBITDA margin for all Big Yellowstores during the year was 69.3%, an improvement from 68.5% last year.

Administrative expenses

Administrative expenses in the income statement have increased by £0.4 million compared to the prior year.The prior year administrative expenses contained non-recurring costs of £0.2 million (the write-off of the Group's acquisition costs for the purchase of Lock and Leave in part offset by prior year VATrecovery), hence the like-for-like increase is £0.6million. £0.4million ofthis increase relates to an increase in the share based payments charge and an increase in national insurance contributions on the vesting of share options (following the increase in the Company's share price).The remaining difference is due principally to an increased investmentin IT and otherinflationary increases. Of our total £10.1 million administrative expense for the year, £2.5 million relates to the non-cash share based payments charge.

Interest expense on bank borrowings

Thegrossbankinterestexpensefortheyearwas£9.8million,areduction of £1.1 million from the prior year.This reflects the Group's lower average cost of debt for the year, following an amendment to the bank loan to change the termdebtto variable debt at a lowermargin, coupledwith the cancellationof aninterestrate derivative over half oftheM&Gloan,which was extended during the year, and its subsequent re-hedging at a lower cost.The lower average costwas in part offset by slightly higher average debt levels. The average cost of borrowing during the year was 2.9% compared to 3.3% in the prior year.

Capitalised interest increased by £0.2 million from the prior year. The interest capitalised in the year is on our Guildford Central store and the Wandsworth extension. In the prior yearinterestwas only capitalised on these developments in the final quarter.

Total finance costs in the income statement increased to £12.0 million from £11.8 million in the prior year, despite the reduction in interest payable, with refinancing costs incurred in the year of £1.5 million (see Borrowings section on page 33).

Profit before tax

TheGroupmade aprofitbefore tax intheyear of£134.1million, compared to a profit of £99.8million in the prior year.

Afteradjustingforthegainontherevaluationofinvestmentpropertiesand othermatters showninthetablebelow,theGroupmadeanadjustedprofit before tax in the year of £61.4 million, up 12% from £54.6 million in 2017.

Profit before tax analysis	2018 £m	2017 £m
Profit before tax	134.1	99.8
Gain on revaluation of
investment properties	(71.6)	(43.7)
Movement in fair value on
interest rate derivatives	(1.3)	(0.7)
Acquisition costs written off	–	0.3
Prior year VAT recovery	–	(0.3)
Gain on part disposal of
investment property	(0.6)	–
Refinancing costs	1.5	–
Share of non-recurring gains and
losses in associates	(0.7)	(0.8)
Adjusted profit before tax	61.4	54.6

The movement in the adjusted profit before tax from the prior year is illustrated in the table below:

	£m
Adjusted profit before tax –
year ended 31 March 2017	54.6
Increase in gross profit	6.2
Decrease in net interest payable	1.0
Increase in administrative expenses	(0.6)
Increase in capitalised interest	0.2
Adjusted profit before tax –
year ended 31 March 2018	61.4

Theshareofadjustedprofitintheassociateswasinlinewiththeprioryear. The Group's share of adjusted profit before tax of the associates was up £0.2 million, however there was an increase in the current tax charge as tax losses have nowbeen fully utilised.

Basic earnings per share for the year was 85.0p (2017: 63.6p) and fully dilutedearningspersharewas84.4p(2017:63.1p).DilutedEPRAearnings per share based on adjusted profit after tax was up 12% to 38.5p (2017: 34.5p)(see note 12). EPRA earnings per share equates to the Company's adjusted earnings per share in the current year.

REIT status

TheGroupconvertedto aRealEstate InvestmentTrust("REIT")inJanuary 2007.SincethentheGrouphasbenefitedfromazerotaxrateontheGroup's qualifying self storage earnings.The Group only pays tax on the profits attributable to our residual business, comprising primarily of the sale of packingmaterials and insurance, and fees earned fromthemanagement ofthe Armadillo portfolio.

REIT status gives theGroup exemption fromUKcorporation tax on profits and gains fromits qualifying portfolio ofUKstores.Revaluation gains on developments and our existing open stores will be exempt from corporation tax on chargeable gains, provided certain criteria are met.

TheGrouphasarigorousinternalsysteminplaceformonitoringcompliance with criteria set outintheREITregulations.Onamonthly basis, a report on compliancewiththesecriteriais issuedtotheExecutive.Todate,theGroup has compliedwith allREITregulations, including forward looking tests.

Taxation

There is a tax charge in the current year of £0.6million.This compares to a charge in the prior year of £0.3 million. The current year tax charge reflects an increase in profits in our residual business, in part offset by deductions allowed fortax purposes fromthe exercise of share options.

Dividends

TheBoardis recommendingthepaymentof a finaldividendof15.5pence per share in addition to the interim dividend of 15.3 pence, giving a total dividendfortheyearof30.8pence,anincreaseof12%fromtheprioryear.

REIT regulatory requirements determine the level of Property Income Dividend ("PID") payable by the Group. On the basis of the full year distributable reserves for PID purposes, a PID of 27.5 pence per share is payable (31 March 2017: 24.0 pence). The balance of the total annual dividend represents an ordinary dividend declared atthe discretion ofthe Board, in line with our policy to distribute 80% of our adjusted earnings per share in each reporting period.The PID forthe yearto 31March 2018 accounts for 89% ofthe total dividend, up from87% in the prior year.

The table below summarises the declared dividend for the year:

Dividend (pence per share)		31 March 2018	31 March 2017
Interim dividend – PID	– discretionary – total	15.3p nil p 15.3p	13.5p nil p 13.5p
Final dividend	– PID – discretionary – total	12.2p 3.3p 15.5p	10.5p 3.6p 14.1p
Total dividend – PID	– discretionary – total	27.5p 3.3p 30.8p	24.0p 3.6p 27.6p

Subject to approval by shareholders at the Annual General Meeting to be held on 19 July 2018,the final dividendwill be paid on 27 July 2018. The ex-div date is 21 June 2018 and the record date is 22 June 2018.

Cash flow growth

The Group is strongly cash generative and draws down from its longer term committed facilities as required to meetits obligations.The Group's cash flow from operating activities for the year was £63.0 million, an increase of 13% from£56.0million in the prior year.

	Year ended 31 March 2018 £000	Year ended 31 March 2017 £000
Cash generated from operations Net finance costs	73,457 (9,711)	67,209 (10,964)
Tax	(769)	(271)
Cash flow from
operating activities	62,977	55,974
Capital expenditure	(41,959)	(20,577)
Asset sales	650	300
Receipt from Capital Goods Scheme	2,786	2,917
Investment in associate	(900)	–
Dividends received from associates	446	396
Cash flow after investing
activities	24,000	39,010
Ordinary dividends	(46,183)	(41,158)
Issue of share capital	969	286
Finance lease payments	(1,109)	(1,196)
Payment to cancel interest rate
derivatives	(3,374)	–
Increase/(decrease) in borrowings	25,644	(7,243)
Net cash outflow	(53)	(10,301)
Opening cash and cash equivalents	6,906	17,207
Closing cash and cash equivalents	6,853	6,906
Closing debt	(330,599)	(304,955)
Closing net debt	(323,746)	(298,049)

In the year capital expenditure outflows were £42.0 million, up from £20.6 million in the prior year.The capital expenditure during the year principally relates to the acquisition of sites inWapping, Bracknell and Slough, coupled with construction costs on Guildford Central and the extension to our existing Wandsworth store.

The cash flowafterinvesting activitieswas a netinflowof £24.0million in the year, down from an inflow of £39.0 million in 2017, with the growth in operating cash flowbeing more than offset by the increased investment in capital expenditure.

Financial Review (continued)

Balance sheet

Property

The Group's 74 stores and seven stores under development owned at 31March2018,whichare classified as investment properties,have been valued individually by Cushman & Wakefield ("C&W") and this has resulted in an investment property asset value of £1,303.3 million, comprising £1,201.8 million (92%) for the 67 freehold (including three long leaseholds) open stores, £43.3 million (3%) for the seven short leasehold open stores and £58.2 million (5%) for the seven freehold investment properties under construction.

Analysis of property portfolio	Value at	Revaluation 31 March 2018 movement in year
Investment property	£1,245.1m	£72.9m
Investment property under construction	£58.2m	(£1.3m)
Total	£1,303.3m	£71.6m

Investment property

The valuations in the current year have grown from the prior year,with a revaluation surplus of £72.9 million arising on the open Big Yellow stores (see note 15 for the detailed valuation methodology). Of this increase 69% is due to an improvement in the cap rate used in the valuations. The average exit capitalisation rate used in the valuations was 6.3% in the current year, compared to 6.6% in the prior year, with the discount rate adopted also reducing from 9.7% to 9.4%. The remaining 31% ofthe increase in value is due to the growth in cash flow from the assets and changes to the operating assumptions adopted in the valuations.

The valuation is based on an average occupancy over the 10 year cash flow period of 83.1% across the whole portfolio.

	Mature Leasehold	Mature Freehold	Established Freehold	Developing Freehold	Total
Number of stores	7	60	4	3	74
MLA capacity (sq ft)	420,000	3,737,000	271,000	178,000	4,606,000
Valuation at 31 March 2018	£43.3m	£1,080.8m	£82.9m	£38.1m	£1,245.1m
Value per sq ft	£103	£289	£306	£214	£270
Occupancy at 31 March 2018	83.8%	82.0%	82.3%	50.6%	81.0%
Stabilised occupancy assumed	84.9%	83.3%	85.4%	85.0%	83.6%
Net initial yield pre-admin expenses	12.9%	6.4%	5.9%	3.5%	6.5%
Stabilised yield assuming no rental growth	13.2%	6.7%	6.4%	8.5%	6.9%

The initial yield pre-administration expenses assuming no rental growth is 6.5% (2017: 6.5%)rising to a stabilised yield of 6.9% (2017: 7.2%).The stores are assumed to grow to stabilised occupancy in 16 months on average.Note15containsmore detail on the assumptions underpinning the valuations.

As referred to in note 15 C&W observe that there is less transaction activity in the prime self storage market compared to other property markets, although there has been some activity for secondary assets. The capitalisation rates are therefore subject to higher levels of uncertainty than for other property sectors.

C&W's valuation report further confirms that the properties have been valued individually butthatifthe portfoliowere to be sold as a single lot or in selected groups of properties, the total value could differ significantly. C&Wstate thatin currentmarket conditions they are ofthe view thatthere could be a material portfolio premium.

Investment property under construction

The investment property under construction valuation has increased by £22.0million in the year. Capital expenditure accounts for £33.0million ofthis increase,notablyonBracknell, Slough,Wapping andHove.Thishas been partly offset by Guildford Central transferring to open stores and a revaluationdeficit of£1.3million,where ourprojectedconstructioncosts have increased due to a change in the planned schemes on a couple of siteswhich are subjectto planning.

Purchaser's cost adjustment

As in prior years, we have instructed an alternative valuation on our assets using a purchaser's cost assumption of 2.75% (see note 15 for further details)to be used in the calculation of our adjusted diluted net asset value. This Red Book valuation on the basis of the special assumption of 2.75% purchaser's costs, results in a higher property valuationat31March2018of£1,380.3million(£77.0millionhigherthan the value recorded in the financial statements).With the share of uplift on the revaluation ofthe Armadillo stores (£0.7 million),this translates to 48.8 pence per share.

This revised valuation translates into an adjusted net asset value per share of 665.0 pence (2017: 607.6 pence) after the dilutive effect of outstanding share options.

Receivables

At 31 March 2018 we have a receivable of £4.3 million in respect of payments due back to the Group under the Capital Goods Scheme, as a consequence of the introduction of VAT on self storage from 1 October 2012. The receivable relates to VAT to be recovered on historic store development expenditure.

The debtor has been discounted in accordance with International Accounting Standards to the net present value using the Group's average cost of debt, with £0.2 million of the discount being unwound through interest receivable in the period. The gross value of the debtor before discounting is £4.6million.

The Group received has received £11.3million to date underthe Scheme, ofwhich £2.8millionwas received in the year.

Net asset value

The adjusted net asset value is 665.0 pence per share (see note 13), up 9% from 607.6 pence per share at 31 March 2017. The table below reconciles the movement from 31 March 2017:

Movement in adjusted net asset value	£m	EPRA adjusted NAV pence per share
1 April 2017	963.4	607.6
Adjusted profit after tax	60.8	38.4
Equity dividends paid	(46.2)	(29.1)
Cancellation of interest rate derivative	(3.4)	(2.1)
Revaluation movements
(including share of associate)	72.4	45.6
Movement in purchaser's cost adjustment	9.2	5.8
Other movements (e.g. share schemes)	2.9	(1.2)
31 March 2018	1,059.1	665.0

Borrowings

Ourfinancing policy is to fund our current needs through amix of debt, equity and cash flow to allow us to build out our development pipeline and achieve our strategic growth objectives,whichwe believe improve returns for shareholders. We aim to ensure that there are sufficient medium-termfacilities in place to finance our committed development programme, secured againstthe freehold portfolio,with debt serviced by our strong operational cash flows. We maintain a keen watch on medium and long-term rates and the Group's policy in respect of interest rates is to maintain a balance between flexibility and hedging of interest rate risk.

During the year, the Group further reduced its average cost of debt, whilst increasing the available facilities and extending the average term of its debt.

The Group extended its £70 million loan with M&G by a year, pushing its expiry out to June 2023. All other terms and conditions of the loan remained the same, hence it was not a material modification of the loan under IAS 39. At the same time, the Group cancelled the existing interest rate derivative that was in place over half of the M&G loan (2.64% expiring in June 2022) at a cost of £3.4 million and replaced it with a new derivative until June 2023 at a pre-margin rate of 0.76%.

The Group also amended the terms of its existing £190 million bank facility, which was treated as an extinguishment of the loan under IAS 39.The £85million termloan,which attracted amargin of 150bps,was converted to revolving loan at a lower margin of 125 bps. The term of the loan was extended to October 2022 with an option in place to extend the loan by a further two years. The Group also has an option to increase the amount ofrevolving loan by a further £80million during the course of the loan's term.The Group exercised its option over £20 million of this debt in March 2018, resulting in the overall bank facility being £210 million at the balance sheet date.

The refinancing costs of £1.5 million shown in the income statement relate to the unamortised loan arrangement costs ofthe previous bank facility, and the write-off of the costs of the new bank facility in accordance with IAS 39.

The table belowsummarises the Group's debtfacilities at 31March 2018.The average cost of debt has reduced to 2.9% from3.2% at 31March 2017:

Debt	Expiry	Facility	Drawn	Average cost
Aviva Loan	April 2027	£87.6 million	£87.6 million	4.9%
M&G loan	June 2023	£70 million	£70 million	2.8%
Bank loan (Lloyds & HSBC)	October 2022	£210 million	£173 million	1.8%
Total	Average term 5.5 years		£367.6 million £330.6 million	2.9%

The Group was comfortably in compliance with its banking covenants at 31March 2018. Forthe yearwe had Group interest cover of 7.6 times (2017: 6.1 times) based on pre-interest operating cash flow against interest paid. The net debt to gross property assets ratio is 25% (2017: 25%) and the net debt to adjusted net assets ratio (see net asset value section above)is 31% (2017: 31%).

At 31March 2018,the fair value on the Group's interestrate derivatives was an asset of £1.7 million. The Group does not hedge account its interest rate derivatives. As recommended by EPRA, the fair value movements are eliminated from adjusted profit before tax, diluted EPRA earnings per share, and adjusted net assets per share.

Cash deposits are only placed with approved financial institutions in accordance with the Group's Treasury policy.

Financial Review (continued)

Share capital

The share capital ofthe Company totalled£15.9millionat31March2018 (2017: £15.8million), consisting of 158,570,574 ordinary shares of 10p each (2017: 157,882,867 shares). 0.7million shareswere issued forthe exercise of options during the year at an average exercise price of 725p (2017: 0.5 million shares at an average price of 738p).

The Group holds 1.1 million shares within an Employee Benefit Trust ("EBT"). These shares are shown as a debit in reserves and are not included in calculating net asset value per share.

	2018 No.	2017 No.
Opening shares Shares issued for the exercise	157,882,867 157,369,287
of options	687,707	513,580
Closing shares in issue Shares held in EBT	158,570,574 157,882,867 (1,122,907)	(1,122,907)
Closing shares for NAV purposes	157,447,667 156,759,960

77.4 million shares were traded in the market during the year ended 31 March 2018 (2017: 74.9 million). The average mid-market price of shares traded during the year was 801.5p with a high of 900p and a low of 722p.

Investment in Armadillo

The Group has a 20% investmentin Armadillo StorageHolding Company Limited and a 20% investmentin Armadillo Storage Holding Company 2 Limited. In the consolidated accounts of Big Yellow Group PLC, our investments in the vehicles are treated as associates using the equity accounting method. In March 2018, Armadillo 2 raised £4.5 million of equity, which alongside additional debt from Lloyds, funded the acquisition of 1st Storage Centres. Big Yellow's equity invested was £0.9 million (20% of the total raised), with the balance funded by our partners.

The occupancy of the Armadillo stores at 31 March 2018 was 73.9% (31 March 2017: 74.7%). The occupancy growth in the year was 161,000 sq ft, including 141,000 sq ft of occupancy acquired in the six store purchases made in the year. The net rent achieved at 31 March 2018 by the Armadillo stores is £16.97 per sq ft, an increase of 2.8% from the same time last year. Revenue increased by 22% to £12.8 million for the year to 31 March 2018 (2017: £10.5 million); the like-for-like increase in revenue was 10%.

The Armadillo Partnerships made a combined operating profit of £6.2million in the year, ofwhich Big Yellow's share is £1.2million. After net interest costs, the revaluation of investment properties (valued by Jones Lang LaSalle), deferred tax on the revaluation surplus and movement in interest rate derivatives, the profit for the year was £4.6 million, of which the Group's share was £0.9 million.

Big Yellow has a five year management contract in place in each Partnership. For the year to 31 March 2018 the Group earned management fees of £1.0 million. The Group's share of the declared dividend for the year is £0.4 million, representing a 12% yield on our original equity invested.

Principal risks and uncertainties

TheDirectorshave carriedout a robust assessment oftheprincipalrisks facing the Company, including those thatwouldthreatenitsbusinessmodel, future performance, solvency orliquidity.

The section below details the principal risks and uncertainties that are considered to have the most material impact on the Group's strategy and objectives.These key risks aremonitored on an ongoing basis by the ExecutiveDirectors, and considered fully by theBoard in its annualrisk review.

	Risk and impact	Mitigation

Self storage market risk

There is a risk to the business thatthe self storage market does not grow in line with our projections, and that economic growth in the UK is below expectations, which could resultin falling demand and a loss of income.

Self storage is a relatively immaturemarketin the UK compared to other self storage markets such as the United States and Australia, andwe believe has further opportunity for growth. Awareness of self storage and howit can be used by domestic and business customers is relatively lowthroughoutthe UK, although higherin London.The rate of growth of branded self storage onmain roads in good locations has historically been limited by the difficulty of acquiring sites at affordable prices and obtaining planning consent. New store openingswithin the sector have slowed significantly overthe pastfewyears.

Our performance during theGlobal Financial Crisis ("GFC")was relatively resilient, although notimmune.We believe thatthe resilience of our performance is due to a combination of factors including:

• > a prime portfolio offreehold properties;
• > a focus on London and the South East and otherlargemetropolitan cities,which proved more resilient during theGFC andwhere the drivers in the self storagemarket are at their strongest and the barriers to competition are attheir highest;
• > the strength of operational and salesmanagement;
• > continuing innovation to deliverthe highestlevels of customer service;
• > theUK's leading self storage brand,with high public awareness and online strength; and
• > strong cash flowgeneration and high operatingmargins,froma secure capital structure.

We have a large current storage customer base of approximately 55,000 spread across the portfolio of stores and hundreds of thousands more who have used Big Yellow over the years. In any month, customers move in and out at the margin resulting in changes in occupancy.This is a seasonal business and typically we see growth over the spring and the summer months, with the seasonally weaker periods being the winter months.

Property risk

There is a risk thatwewill be unable to acquire new development siteswhich meetmanagement's criteria. Thiswould impact on our ability to growthe overall store platform.The Group is also subjectto the risk of failing to obtain planning consents on its development sites, and the risk of a rising cost of development.

Ourmanagement has significant experience in the property industry generated over many years and in particularin acquiring property onmain roads in high profile locations and obtaining planning consents.We do take planning riskwhere necessary, although the availability of land, and competition foritmakes acquiring newsites challenging.

Ourin-house developmentteamand our professional advisers have significant experience in obtaining planning consents for self storage centres.

Wemanage the construction of our properties very tightly.The building of each site is handled through a design and build contract,with the fit out projectmanaged in-house using an established professionalteamof external advisers and sub-contractorswho haveworkedwith us formany years to our Big Yellowspecification.We carried out an external benchmarking of our construction costs and tendering programme in 2016, which had satisfactory results.

Valuation risk

The valuations ofthe Group's investment properties may fall due to external pressures orthe impact of performance.

Lack oftransactional evidence in the self storage sectorleads tomore subjective valuations.

The valuations are carried out by independent, qualified external valuerswho value a significant proportion oftheUKself storage industry.

The portfolio is diversewith approximately55,000customers currently using our stores for awide variety ofreasons.

There is significant headroomon ourloan to value banking covenants.

Change during the year and outlook

The UK economy is projected to grow at approximately 1.5% in 2018. Self storage proved relatively resilientthrough the GFC, with our revenue and earnings increasing overthe last eight years. As the economy has recovered in the past few years, the marketrisk has fallen in line with increasing occupancy.

There is increased macroeconomic uncertainty

associated with the UK's future exit from the EU, and this has resulted in a broad range of opinions on the UK's future economic performance.

The Group's like-for-like occupancy has increased by 3.9 percentage points in the year from 78.0% to 81.9%.

The planning process remains difficult and to achieve a planning consent can take anything from eighteen months to three years. Local planning policy is increasingly favouring residential development over other uses, and we don't expect this to change given the shortage of housing in the UK.

The revaluation surplus on the Group's open stores investment propertieswas£72.9million in the year(an uplift of6%), due to an improvementin cash flows and the capitalisation rates used in the valuations.

There continues to be an increase in transactional evidence in the sector,with a number of portfolio transactions taking place in the current year.

Strategic Report (continued)

Financial Review (continued)

Risk and impact	Mitigation	Change during the year and outlook
Treasury risk The Group may face increased costs from adverse interest rate movements.	Ourfinancing policy is to fund our current needs through amix of debt, equity and cash flow to allowus to selectively build outthe remaining development pipeline and achieve our strategic growth objectives,whichwe believe improve returns for shareholders.We have made it clearthatwe believe optimal leverage for a business such as ours should be LTV in the range20% to30% and this informs ourmanagement oftreasury risk.	Interestrates were increased during the year, and the forecast is for further moderate increases, albeitthey are expected to remain atrelatively lowlevels forthe foreseeable future. UK inflation
	We aimto ensure thatthere are sufficientmedium-termfacilities in place to finance our committed development programme, secured againstthe freehold portfolio,with debt serviced by our strong operational cash flows.	reached 3% in 2017, butis forecast tomoderate slightly in 2018.
	We have a fixed rate loan in place fromAviva Commercial Finance Limited,with nine years remaining.TheGroup has a£70million loan fromM&GInvestments,which is50% fixed and 50% floating,repayable in2023. For our bank debt,we borrowatfloating rates ofinterest and use swaps to hedge ourinterestrate exposure.Our policy is to have atleast40% of our total borrowings fixed,with the balance floating. At31March201846% oftheGroup's total borrowingswere fixed or subjectto interestrate derivatives.TheGroup reviews its current and forecast projections of cash flow, borrowing and interest cover as part ofitsmonthly	Debt providers currently remain supportive to companies with a strong capital structure.That said, a weaker macro-economic performance by the UK economy could adversely affectliquidity and pricing.
	management accounts. In addition, an analysis ofthe impact of significanttransactions is carried outregularly, aswell as a sensitivity analysis assumingmovements in interestrates and store occupancy on gearing and interest cover.This sensitivity testing underpins the viability statement below.	The Group's interest cover ratio for the year to 31 March 2018 was 7.6 times, comfortably ahead of our internal target of 5 times.
	TheGroup regularlymonitors its counterparty risk.TheGroupmonitors compliancewith its banking covenants closely.During the yearit compliedwith all its covenants, and is forecast to do so forthe foreseeable future.
Tax and regulatory risk The Group is exposed to changes in the tax regime affecting the cost of corporation tax, VAT Stamp Duty and Stamp Duty Land Tax ("SDLT"),for example the imposition of VAT on self storage from1 October 2012.	We regularlymonitor proposed and actual changes in legislationwith the help of our professional advisers,through directliaisonwith HMRC, and through trade bodies to understand and, if possible,mitigate or benefitfromtheirimpact. HMRC have designated the Group as having a low-risk tax status, andwe hold regular meetingswith them.We carry out detailed planning ahead of any future regulatory and tax changes using our expert advisers. The Group has internalmonitoring procedures in place to ensure thatthe appropriate REITrules and legislation are compliedwith.To date all REITregulations have been compliedwith, including projected tests.	In addition to the regulatory and tax uncertainty linked to the UK's future exit from the EU, the Group has experienced an increase in cost in the year following the Government's review of business rates.
The UK's future exit from the EU creates uncertainty over the future UK tax and regulatory environment.
The Group is exposed to potentialtax penalties or loss of its REIT status by failing to comply with the REITlegislation.
Human resources risk Our people are key to our success and as suchwe are exposed to a risk of high staffturnover, and a risk of the loss of key personnel.	We have developed a professional, lively and enjoyableworking environment and believe our success stems fromattracting and retaining the right people.We encourage all our staffto build on their skills through appropriate training and regular performance reviews. We believe in an accessible and open culture and everyone at all levels is encouraged to reviewand challenge accepted norms, so as to contribute to the performance oftheGroup. Wewere ranked80th in the Sunday TimesBest100Companies toWork For survey in February2016.	During the prior year, an employee consultancy conducted an engagement survey of our employees.The survey results showed very high levels of employee engagement(90%), whichwas an increase from86%
With lowunemployment, and a risk of higher staff turnover, difficulty in finding the right employees increases.		fromour previous survey in2014.

Risk and impact	Mitigation	Change during the year and outlook
Brand and reputation risk The Group is exposed to the risk of a single serious	We have always aimed to run this business in a professionalway,which has involved strict adherencewith allregulations that affect our business, such as health and safety legislation, building regulations in relation to the construction of our buildings, anti-slavery, anti-bribery and data regulations.	During the year, we developed a crisis response plan with external consultants to ensure the Group is well placed to deal with a major
incident materially affecting our customers, people, financial	We also investin cyber security (discussed below), andmake an ongoing investmentin stafftraining,facilitiesmanagement and themaintenance of our stores.	incident more effectively.
performance and hence our brand and reputation.	To ensure consistency of service and to understand the needs of our customers,we send surveys to every customerwhomoves in andmoves out ofthe business.The results ofthe surveys andmystery shops are reviewed to continuously improve and deliver consistent performance throughoutthe business.
	Wemaintain regular communicationwith our key stakeholders, customers, employees, shareholders and debt providers.
Security risk The Group is exposed to the risk ofthe damage orloss of store due to vandalism,fire, or natural incidents such as	The safety and security of our customers,their belongings, and stores remains a key priority.To achieve thiswe investin state ofthe art access control systems, individual roomalarms, digital CCTV systems, intruder and fire alarmsystems and the remote monitoring of all our stores outside of ourtrading hours.We are the onlymajor operator in the UK self storage industry that has every roomin every store individually alarmed.	We have continued to run courses for all our staff to enhance the awareness and effectiveness of our procedures in relation to security.
flooding.Thismay also cause reputational damage.	We have implemented customer security procedures in linewith advice fromthe Police and continue toworkwith the regulatory authorities on issues of security,reviewing our operational procedures regularly.The importance of security and the need for vigilance is communicated to all store staff and reinforced through training and routine operational procedures.	We regularly review and implement improvements to our security processes and procedures.
Cyber risk High profile cyber-attacks and data breaches are a	The Group receives specialist advice and consultancy in respect of cyber security and we have dedicated in-house monitoring and regular review of our security systems, we also limitthe retention of customer data to the minimum requirement.	We don't considerthe risk to have increased any faster for the Group than anyone else; however
regular staple in today's news.The results of any breachmay resultin	Policies and procedures are under regular review and benchmarked againstindustry best practice by our consultants.These policies also include defend, detect and response policies.	we consider thatthe threats in the entire digital landscape do continue to increase.
reputational damage,fines, or customer compensation, causing a loss ofmarket share and income.	We have also instigated a new working group for compliance with the new EU General Data Protection Regulation ("GDPR") which comes into effect on 25May 2018.	During the year we have continued to invest in digital security. Some of the changes include more frequent penetration testing of internet facing systems, adding components such as anti-ransomware as well as the maintenance replacement of components such as firewalls to the latest technology and specification. The introduction ofGDPR
		legislation fromMay2018places

additionalregulatory burdens onto theGroup and carries significant penalties for non-compliance.

Internal audit

The Group does not have a formal internal audit function because the Board has concluded thatthe internal controls systems are sufficientfor the Group at this time. However, the Group employs a Store Compliance Managerresponsibleforreviewingstoreoperationalandfinancial controls. He reports to the Chief Financial Officer, and also meets with the Audit Committee at least once a year.This role is supported by an Assistant Store Compliance Manager, enabling additional work and support to be carried out across the Group's store portfolio.The Store Compliance team will visit each operational store once to twice per year to carry out a detailed store audit. These audits are unannounced and the Store Compliance team carry out detailed tests on financial management, administrative standards, and operational standards within the stores. Partofthestorestaff'sbonus isbasedonthescores theyachieveinthese audits.TheresultsofeachauditarereviewedbytheChiefFinancialOfficer, the Financial Controller and the Head of Store Operations.

GOING CONCERN

A review of the Group's business activities, together with the factors likely to affectits future development, performance and position are set out in the Strategic Report.The financial position of the Group, its cash flows, liquidity position and borrowing facilities are shown in the balance sheet, cash flow statement and accompanying notes in the financial statements. Further information concerning the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details ofits financial instruments and hedging activities; and its exposures to credit risk and liquidity risk can be found in this Report and in the notes to the financial statements.

Afterreviewing Group and Company cash balances, borrowing facilities, forecast valuation movements and projected cash flows,the Directors believethattheGroupandCompanyhaveadequateresources tocontinue operations for the foreseeable future. In reaching this conclusion the Directors have had regard to the Group's operating plan and budget for the year ending 31March 2019 and projections contained in the longertermbusiness planwhich covers the period toMarch2022.TheDirectors have carefully considered the Group's trading performance and cash flows as a result ofthe uncertain global economic environment and the other principalrisks to the Group's performance and are satisfiedwith the Group's positioning. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

VIABILITY STATEMENT

The Directors have assessed the Group's viability over a four year period toMarch 2022.This period is selected based on the Group's long term strategic plan to give greater certainty over the forecasting assumptions used.

In making their assessment,the Directors took account ofthe Group's currentfinancial position, including committed capital expenditure.The Directors carried out a robust assessment of the principal risks and uncertainties facing the business and their potential financial impact on the Group's cash flows, REIT compliance and financial covenants and the likely effectiveness of the mitigating options detailed. The Directors have assumed that funding for the business in the form of equity, bank and insurance debt will be available in all reasonably plausible market conditions.

Based on this assessmentthe Directors have a reasonable expectation thatthe Company and the Groupwill be able to continue operating and meeting all their liabilities as they fall due to March 2022.

BIG YELLOW IS COMMITTED TO RESPONSIBLE AND SUSTAINABLE BUSINESS PRACTICES.

1.0 INTRODUCTION

Big Yellowis committed to responsible and sustainable business practices.The Board recognises that corporate socialresponsibility ("CSR"), when linked to clear commercial objectives, will create a more sustainable business and increase shareholder and customer value in both the medium and long term. People, Planet and Profit need to be aligned to make a sustainable business.

Big Yellow seeks to meet the demand for self storage from businesses and private individuals by providing the storage space for their commercial and/or domestic needs, whilst aiding local employment and contributing to the local community.

Our CSR policy covers all the parts of Big Yellow's operations, as both a developer and operator of self storage facilities. We recognise that our business activities can have significant economic, environmental and social impacts.We are committed to assessing our CSR risks and opportunities, and thereafter taking appropriate steps to mitigate negative impacts and where possible enhance positive impacts for the benefit of our business, our stakeholders and our local environment.

The result of operating responsibly is the social value that we create.

2.0 CSR EXECUTIVE SUMMARY

Big Yellow is pleased to deliver another year of steady CSR progress across the Group, full details of which can be found in our online report ("Full CSR Report 2017/18") with the highlights presented here.

2.1 CHANGES THIS YEAR

This year a number of changes are reflected in this report and in the Full CSR Report.The most significant changes are:

• > the CSR strategy has been broadened to formally include five key stakeholder groups:
• > environment(same as current);
• > customers (new);
• > suppliers (new);
• > employees (significantly modified through the Big Yellow Foundation); and
• > communities (significantly modified through the Big Yellow Foundation).

These five groups are supplemented by a further three broader stakeholder groups: investors, national and international bodies and local government(all same as current):

• > a refresh and launch of our CSR Policy to reflect strategy changes; supplemented by a CSR Policy Standard published in November 2017 to demonstrate how we do things;
• > a refocus of Big Yellow's interest in, and commitment to, 'the social value we create';
• > the alignment of CSR programmes and initiatives; and
• > the publishing of a separate draft GRI Index and EPRA table this is the first time we are publishing tables and we will show some gaps in our reporting. Closing these gaps will help inform our CSR programmes going forward.

2.2 HIGHLIGHTS FOR THIS YEAR

Social and economic value we create

We commissioned an independent report this year to examine the economic value our stores bring to their local communities; the findings are impressive:

Across the whole country, Big Yellow's stores:

• > are home to over 7,700 businesses;
• > these businesses generate a national GVA of over £1 billion;
• > these businesses create around 23,000 jobs;
• > for half these businesses it's the only space they have; and
• > 60% of these businesses are start ups.

Strategic Report (continued)

Corporate Social Responsibility Report (continued)

2.2 HIGHLIGHTS FOR THIS YEAR (continued)

Our stores contribute significantly to their local communities – we further add value through our community investment and engagement programmes, our environmental programmes and the broader initiatives with all of our stakeholders, such as our suppliers.

The total amount of Community investment in 2017/18 is £714,000.

The Big Yellow Foundation: with the roll-out of our Big Yellow Foundation on 12 February 2018 we have piloted work and volunteering programmes with our six charity partners – we intend to continue to evolve and grow these programmes in the coming years.

In the first few weeks of rolling out, we have raised over £11,000 from customer donations, which is matched by Big Yellow. Together, we hope to raise £150,000 during 2018/19 for our chosen causes.

Our People

During 2017/18 we employed 335 full time equivalents ("FTEs" 1) across our stores, head office and Maidenhead and invested heavily in their training and development.

Health and Safety Record

This has continued at a high standard at both our stores and on our construction projects. Measured by both the number of recorded Minor Injuries and by RIDDOR (Reporting of Injuries, Diseases and Dangerous Occurrences Regulation), our high standards of Health&Safety have continued to protect our customers, staff, contractors and other visitors.

There were no "Fatal Injuries, Notices or Prosecutions" during the year ended 31 March 2018 in any part of our operations.

Our Environment

Between 2015 and 2017we havemade significantinvestments of over £540,000 in internal and external LEDlighting upgrades andmotion sensor installations.Despite a growing store portfolio overthe same time,the investment has allowed us tominimise any increase in energy use.

We have beaten our emissions reduction target of 34% by 2020. From our baseline year of 2008, we have achieved a 45% Scope 1 and 2 emissions reduction.

Energy Performance Certificates ("EPCs"): 63.5 % of our stores have EPCs (up from 42% during 2016/17), 78% of which are rated A or B.

Our Solar generation as % of grid use is 3.5%, slightly lower than in the previous year. However our latest store in Guildford Central has been equipped with a 50kWh installation and we hope will contribute to a higher % next year.

With the completion of our major LED & motion sensor lighting investment programme, we intend to review our mid-term and long-term energy and emission strategy during 2018/19.

We remain committed to the UK government's emission reduction commitments.

We have initiated a broader review of resources and have embarked on a programme to remove 1,600kg of single-use plastic over a four year period (mainly outer bags of our packaging materials).

• > Over £540,000 invested in energy saving initiatives over three years
• > EPCs up now at 63.5% of GIA
• > Emission reductions target achieved
• > Plan in place to tackle single-use plastic

CSR Performance Benchmarking

We continue to participate in our sustainable benchmarking initiatives and deliver competitive results:

FTSE4Good	Carbon Disclosure Project (CDP)	Global Real Estate Sustainability Benchmark (GRESB)
Our FTSE ESG Rating of 2.8 is a slight	Our Management score of B means	We achieved a rating of 59/100,
improvement from the prior year (2.7)	we have outperformed the industry average	ranked No. 1 among peers

¹ Please note, FTE equivalent number used for H&S reporting for example was 335 FTEs. For our GRI reporting, we count each individual, making it 380.

3.0 OUR PEOPLE

Introduction

Our people are at the heart of our Company, bringing our values to life through the service that they provide and through the energy and passion that drives us to become an ever more responsible and sustainable business.

We recognise that recruiting, retaining and motivating individuals with talent and integrity, and ensuring that we listen to our people and maximise their skills and performance, is key to the continued success of our Company.

We encourage a culture of partnership within the business and believe in staff participating in corporate performance through benefits such as customer feedback rewards, bonus schemes and share incentives. We recognise and reward the exceptional performance, achievements and ideas of our people through a Points Recognition Scheme, and allocated £55,000 of points for the year ended 31March 2018.

This year, we are including employment data as per GRI requirements² wherever we are able to – we intend to improve on delivering meaningful data in the coming years.

• > £55,000 of points allocated to reward performance & achievements
• > HR GRI indicators published
• > Continued high level investment in employee training and development

Wellbeing and Support

We aimto promote employeewellbeing through a range of flexibleworking options,which include flexi-time, staggeredworking hours, home working and sabbaticals. We provide Childcare Vouchers along with a comprehensive range of medical support and advice through our private healthcare scheme and occupational health providers.We have arranged corporate gym membership on a national basis, as well as a "Cycle to Work" scheme and an Employee Assistance Programme.

Communication and Engagement

We continue to recognise the importance of communication and consultationwith our employees and deliver an annual Spring Conference, regularformal and informal businessmeetings, quarterly newsletters andweekly operational updates.The Head of CSR has also introduced a CSR blog with employees being encouraged to participate and comment. In addition, the Directors and Senior Management spend a significant amount of time in the stores and are always accessible to employees at all levels.

We value feedback from our employees and are committed to periodically assessing their levels of engagement. We specifically seek feedback on day to day working life, learning and development, communication management style and leadership. We regularly carry out internal employee surveys or external Benchmarks. We plan to take part again in The Sunday Times Best Companies to Work For in 2019.

Training and Development

We continue to promote the development of our staff through ongoing training and regular performance appraisals. For the year ended 31 March 2018 a total of 1,330 training days were provided across the Company, comprising of both sales and operational training, and personal and management development.

With the opening of our new training hub at Guildford Central inMarch 2018 we can now offer our employees an even better environment to develop their skills and grow within our organisation.

² Please see our Full CSR Report 2017/18

Strategic Report (continued)

Corporate Social Responsibility Report (continued)

4.0 OUR COMMUNITIES

Community Investment and Engagement

This year, we have significantly increased our Community Investment and Engagement activities – mainly through the roll-out of the Big Yellow Foundation to all Big Yellow and Armadillo stores.

This has become an integral part of howwe do business andwe intend to provide ongoing information on howprogress in the Annual Report.

It is part of why our employees enjoy working for us and therefore a critical element to continued employee wellbeing.

Community Investment

Forthe first yearwe aremeasuring ourtotal community investment –we intend to report on this performance annually and are considering setting targets for this in the future. Please see the Targets and Commitments section for further information.

	2018
Free Space donated for community or charity use (£)	£684,000
Payments to Social Enterprise organisations (£)	£5,000
Total employee Big Yellow Foundation fundraising & Big Yellow matched funds (£)	£2,000
Other funds raised3	£23,000
Total Community Investment	£714,000

The Big Yellow Foundation

Introduction

The Big Yellow Foundation was rolled-out to all our stores on 12 February 2018, after nearly two years of development and preparation.

The Big Yellow Foundation works with charity partners supporting vulnerable people to find employment and create a better future for themselves; through our Foundation we want to engage with charities who will make a real difference in today's society.

We have therefore selected six innovative charities that tackle more challenging aspects of our society and are as a result often forgotten about.They are Breaking Barriers, Bounce Back, the Down's Syndrome Association, the Back UP trust, Hire a Hero and St Giles Trust.

• > First 6 month work placement complete (with Breaking Barriers)
• > Just under £45,000 raised during the pilot phase
• > One employee fundraising event held three more planned

In the words of James Gibson, CEO of Big Yellow Group PLC and Chair ofTrustees,The Big Yellow Foundation:

"We try to help our customers who are often going through a stressful event in their lives when they use our services our values and philosophy are all about making our customers' lives easier.

Through the Big Yellow Foundation, we want to extend this philosophy to charities who will make a real difference in today's society, giving people a helping hand back into the workplace. I have personally met with all of these charities and now look forward to us creating meaningful partnerships with them."

Find out more here https://www.bigyellow.co.uk/foundation/

³ For example, charities own collection tins in stores – collection tins are being phased out

4.0 OUR COMMUNITIES (continued)

Breaking Barriers

Breaking Barriers offer a unique approach to helping refugees in London find meaningful employment and thus rebuild their lives and integrate them into their new home.

"Partnering with Big Yellow has been incredibly exciting for us. It is rare to find an employer so passionate and dedicated to providing meaningful placements to vulnerable groups, such as refugees. Yuel, has not only developed the professional skills to enter employment, but the confidence and support network to help him on his journey.Thanks to all the lovely people who supported him throughout the 6-month period."

Matthew Powell, CEO Breaking Barriers

Bounce Back

Bounce Back is a Charity and a social enterprise focussed on training and employment of ex-offenders.They firmly believe that everyone has the ability to change andworking in several prisons, alongwith London Probation,they offertraining,work experience and employment to offenders at the end of their sentences using the skills developed both in custody and on release.

The Back Up Trust

Every 8 hours someone in the UK is permanently paralysed through a back injury.

Back Up inspire people affected by spinal cord injury to get the most out of life.

''Back Up are delighted to have been chosen as one of Big Yellow's partner charities.We are looking forward to partnering with them in a number of areas from supporting people with spinal cord injury back to work as well as engaging staff in different areas including staff fundraising. ''

T Farr, Corporate Partnerships Fundraiser

The Down's Syndrome Association

The DSA provides advice, guidance and support to families, carers and professionals to children and adults and their families with Down's Syndrome.The DSA actively support individuals into work through their Workfit programme.

Hire a Hero

Hire a Hero supports Service Leavers and Veterans to make the successful transition into civilian life.

Trained Hire a Hero staff, Career Coaches and Volunteers working with Service Leavers and Veterans to help them make the right choices through the transition period.

St Giles Trust

St Giles Trust is a charity helping people facing severe disadvantage to find homes, jobs and the right support they need.They help them to become positive contributors to local communities and wider society.

They passionately believe everybody is capable of changing their lives. Their mission is to help their clients achieve this through offering support from someone who has been there.Their peer-led services form the backbone of their work.

For 2018/2019 we have set an overall target of raising £150,000 for the Big Yellow Foundation.

Strategic Report (continued)

Corporate Social Responsibility Report (continued)

5.0 OUR CUSTOMERS

Introduction

Our Annual Report provides insights into our customers and howBig Yellowmeets their needs, such as flexible, shorttermspacewhenmoving house or for home improvements, a permanent base for running a business or extra distribution hubs for our national accounts customers.

Our most material commitment to all of our customers is to provide a safe, secure, welcoming and friendly environment.

We report on the following aspects:

• > Customer and Visitor Health & Safety please refer to the Health & Safety section of this CSR Report.
• > Customer Service performance, security of our stores and the financial stability of our organisation please refer to the main Financial Annual Report.
• > Our commitment to the Environment, in particular running efficient stores please refer to the Environmental section of this CSR Report.
• > Our commitment to and investment in our local communities please refer to the Communities section of this CSR Report.

Big Yellow Foundation Engagement

We have successfully engaged our customerswith the Big YellowFoundation this year and invited themto donate. Big Yellowin turnmatches total customer donations.

We monitor customer donations as an indicator of engagement success.

6.0 OUR SUPPLIERS

Introduction

Big Yellow recognises that it can have a significant impact on its suppliers and that its supply base can represent an important aspect to help Big Yellow to deliver against its environmental and social responsibilities.

Supplier payments and small suppliers

In 2017 we signed up to the Prompt Payment Code (PPC), joining a host of other companies who are committed to trading ethically and setting standards within their supply chain.

The PPC sets standards for payment practices and best practice and is administered by the Chartered Institute of Credit Management. Compliance with the principles of the Code is monitored and enforced by the PPC Compliance Board.The Code covers prompt payment, as well as wider payment procedures.

You can find out more about the PPC on www.promptpaymentcode.org.uk.

Read more about our plans with and for suppliers online in our Full CSR Report.

7.0 OUR HEALTH & SAFETY

Big Yellowrecognises the importance of maintaining high standards of Health&Safety for our customers, staff, contractors and any visitors to our stores. Our Health & Safety Committee reviews Policy, Risk Assessments, performance and records on a quarterly basis.The Policy covers two distinct areas – our construction activities and our routine store operations.

The Health & Safety Committee discuss and review any issues reported from our regular meetings held at Bagshot (our head office), Maidenhead (our distribution warehouse), the stores and our construction sites. Our Health & Safety Policy states that all employees have a responsibility for Health & Safety, but that managers have special responsibilities.The responsibilities of Adrian Lee, Operations Director, are to keep the Board advised on Health & Safety issues and to ensure compliance with the Policy in respect of Construction (via the Construction Director) and store operations (via the Facilities Manager and Head of Store Operations). Externally, other interested stakeholders include the Health & Safety Executive (HSE) and Local Government Authorities.

Deloitte LLP undertake a limited level of assurance on select health and safety and environmental indicators, in accordance with the International Standard on Assurance Engagements 3000 (ISAE 3000 Revised).

7.0 OUR HEALTH & SAFETY (continued)

Big Yellow Store Customer, Contractor and Visitor Health & Safety

Executive Summary

• > One 'reportable injury' was recorded; to a customer at Finchley North who suffered a cut to his finger.
• > In addition to the one reportable injury, we recorded 61 'minor injuries' during the year to 51 customers and to 11 visitors (no recorded contractor injuries). Customer injuries were mainly minor cuts, grazes and strains relating to the handling of their goods. Most of these injuries and those of 'visitors' could have been avoided by personal protective gloves and foot-wear.

Store Customer, Contractor and Visitor Health & Safety Year ended 31 March	2014	2015	2016	2017	2018
Number of customer move-ins	72,772	75,097	75,438	71,715	73,928
Number of minor injuries	31	50	58	41	61+
Number of reportable injuries (RIDDOR)	3	4	4	1	1+
RIDDOR per 100,000 customer move-ins	4.1	5.3	5.3	1.4	1.3

Please note: + indicates data reviewed by Deloitte LLP. See page 54 for their independent assurance report.

Big Yellow Staff Health & Safety (Stores & Head Office)

Executive Summary

> Fourteen staff injuries were reported, thirteen of which were Minor Injuries, with one being a Reportable Injury (one member of our staff in our Chiswick store hurt his back).The injuries related to a range of minor hand, arm or leg injuries. One of the staff injuries resulted in a maintenance call out to remedy the item that caused the injury.

Big Yellow Staff Health & Safety (Stores & Head Office) Year ended 31 March	2014	2015	2016	2017	2018
Average Number of Staff	289	300	318	329	335+
Number of Minor Injuries	13	15	10	9	13+
Number of Reportable Injuries (RIDDOR)	1	1	1	0	1+
AIIR* per 100,000 staff	346	333	314	0+	299+

Please note: + indicates data reviewed by Deloitte LLP. See page 54 for their independent assurance report.

Our rolling facilities maintenance programme, our annual senior management store visits, and the external Health & Safety consultant audits, all play vital parts in identifying potential hazards that could cause injury to anyone accessing our stores.

Big Yellow Construction 'Fit Out' Health & Safety

Executive Summary

> There were 2,726 'Man Days' worked on new store construction 'Fit Out' projects in 2018, an increase of 245% from 2017.

> Three Minor Injuries and no Reportable Injuries were recorded during these works.

Construction Health & Safety (Fit-out Contractors and Visitors) Year ended 31 March	2014	2015	2016	2017	2018
Number of Total Man Days worked	3,315	3,005	6,560	1,111	2,726+
Number of Minor Injuries	2	1	3	0	3+
Number of Reportable Injuries (RIDDOR)	0	0	0	0	0+

Please note: + indicates data reviewed by Deloitte LLP. See page 54 for their independent assurance report.

> The final assessment made by the independent Considerate Constructors Scheme (CCS)for our new Guildford Central store was completed in January 2018 and delivered very good scores. We scored 'Very Good' for 'Securing everyone's Safety', 'Care about Appearance', 'Valuing the Workforce' and 'Protecting the Environment' and an Excellent was scored on 'Respecting the Community'.

Strategic Report (continued)

Corporate Social Responsibility Report (continued)

8.0 OUR ENVIRONMENT

Introduction

Environmental Responsibilities

Our CSR Policy sets out the aspects of what we manage. Our CSR Policy Standard, launched at the end of 2017, provides further information on how we manage the impact of our business on society and the local environment, to control our risks and manage our opportunities in a sustainable manner.

External Benchmarking

We also use the detail in the full CSR Report to participate in other benchmarks, such as the annual Carbon Disclosure Project (CDP) and the Global Real Estate Sustainability Benchmark (GRESB) which allows us to engage with our Ethical Investors. Notwithstanding this and in order to maintain an efficient and sustainable business for its stakeholders, we have continued to commit significant resources to the environmental and social aspects of our store operations, property portfolio, new store developments and site acquisitions.

For more details on our applications for the above benchmarks see our 'Basis of Reporting' in the CSR section of our Investor Relations website.

Compliance

In this report we state our energy use and carbon emissions in compliance with the Companies Act and the Climate Change Regulation on Reporting Greenhouse Gas ("GHG") Emissions for listed companies.

We have used the DEFRA Department Environmental Reporting Guidelines (UK DEFRA 2017 Emissions factors database (published 4 August 2017)) conversion factors for our annual GHG Emission calculations and reporting.

Approach

We have provided a summary of our Scope 1 'onsite' gas use, solar electricity generation and refrigerant use, and our Scope 2 'off site' supplied electricity for our carbon dioxide equivalent emissions and a brief narrative to explain variances where applicable.

We report on a range of environmental key performance indicators and – where relevant – identify them using the codes from the Global Reporting Initiative ('GRI'), as applied by the European Public Real Estate Association (EPRA) at the request of some of our stakeholders.

For the first time this year, we are publishing tables and intend to show:

• a) GRI/EPRA indicators we do report against;
• b) GRI/EPRA indicators that are not directly relevant to the nature of our particular operations; and
• c) GRI/EPRA indicators we will consider reporting on in the future.

Materiality Threshold

Our materiality threshold for energy and carbon emissions is > 5%.

Assurance:

Deloitte LLP undertake a limited level of assurance on select health and safety and environmental indicators, in accordance with the International Standard on Assurance Engagements 3000 (ISAE 3000 Revised).

8.0 OUR ENVIRONMENT (continued)

Environmental Performance

Executive Summary

• > Between 2015 and 2017 we have made significant investments of £544,000⁴ in internal and external LED lighting upgrades and motion sensor installations.
• > We have made good progress to reduce energy consumption and emissions and have already beaten our emissions reduction target of 34% by 2020, having achieved a 48.8% reduction from our peak year 2011 by 2018.
• > Our total Scope 1 & 2 emissions compared to last year have decreased by 14.7% this has been largely achieved through a favourable UK fuel mix during 2018 but also by our investments in sustainable lighting and motion sensors.
• > With our investment in LED lighting and motion sensor programmes complete, our energy use and emissions performance are likely to have plateaued during 2017/18. As we add stores in the years to come, we can expect to see an increase in energy use, which we hope to minimise by installing Solar PV and/or other renewable solutions for new build stores.
• > Our Solar generation as % of our grid use is 3.5%, slightly lower than the previous year. However, our latest store in Guildford Central has been equipped with a 50kWh installation and we hope will contribute to a higher % next year.
• > During 2018/19, we will review our renewables strategy to ensure we can reduce our grid electricity use further over time. We will be also looking at specific targets and look forward to report against these within our next annual report.
• > The EPRA referenced table below allows our investors a brief insight into our performance.

EPRA Reference	EPRA Definition	Current year5	Variance to	Trend
ELEC-ABS	Total electricity consumption	9,494,954kWhs+	(31.8%)	'
ELEC-LfL	Like for like total electricity consumption	9,488,436kWhs	+1.1%	·
FUELS-ABS	Total fuel consumption	646,284kWh	(12.9%)	'
FUELS- LfL	Like for like total fuel consumption	Not material	/	/
Energy-Int	Building Energy intensity – by GIA (KWh / GIA (m2)6	15.4	(42.3%)	'
GHG-DIR-ABS	Total direct Greenhouse gas emissions	147.5+	(68.9%)	'
GHG-INDIR-ABS	Total indirect Greenhouse gas emissions	3,373+	(50.1%)	'
GHG-Int	Greenhouse Gas (GHG) emissions Intensity
	from building energy consumption	5.3	(60%)	'
Water-Abs	Total Water Consumption	Planned	/	/
Water-LfL	Like for like total Water Consumption	Planned	/	/
Water-Int	Building Water intensity	Planned	/	/
Waste-Abs	Total weight of waste by disposal route	Reported	Seewaste stats	·
Waste-LfL	Like for like total weight of waste by disposal route	N/A	/	/
Cert-Tot	Type and number of sustainably certified assets	61% of GIA covered		·

Please note: + indicates data reviewed by Deloitte LLP. See page 54 for their independent assurance report.

⁴ As provided by our Facilities department and is based on tracked spending of equipment and installation

⁵ Variable, depending on indicator

⁶ We also provide data on Energy-Int for Annual Average Occupancy, please refer to Full CSR Report 2017/18

Strategic Report (continued)

Corporate Social Responsibility Report (continued)

8.0 OUR ENVIRONMENT (continued)

ENERGY

Long Term Electricity Use

Executive Summary

> A smallreductioninlike-for-likeelectricityuseinstoreshasbeenachievedagainstthebackdropofrelativelystablestoreportfoliointermsofthe numberoftradingfacilities.

Long Term Store Electricity 2008 to 2018

Store portfolio Electricity Use from Peak Energy Year 2011 (GRI Elec-Abs / G4-ENS3)

Wehavereducedour stores'electricityuseby31.8%fromourpeakyearin2011.

Store Portfolio Long Term Solar Electricity Generation (2009 to 2018)

Our portfolio of storeswith roof-mounted solar PV installations generate lowcarbon electricity thatismonitored for performance and receives financial payments from energy companies we export to. There are 18 stores, including our newest store in Guildford Central 7, with solar installations, many of which have an installed capacity of 50kWh.

⁷ With 20 days online before year end, during a time of low sunshine hours has not materially contributed to the overall figures.

8.0 OUR ENVIRONMENT (continued)

Executive Summary

• > Solar electricity generation represents a saving of approximately 9 pence per kWh for displaced UK network supplied electricity, a total saving of £30,000 over the year.
• > Since 2011 our solar generation has tripled we remain committed to our investments in solar. Our percentage of solar energy used in stores with Solar PV capacity of 50kWH was 36.4%.
• > During 2018 we saw a 4.1% drop in our solar electricity generation compared to 2017.This was the result of less sunshine in 2017/18 but is disappointing, as we see solar PV as an important part of our energy and renewables strategy and remain committed to installing Solar PV on all new stores (where possible).
• > We anticipate that our maintenance contract with a new service partner will result in improved data quality and deliver swifter responses to any future solar installation issues.

Store Solar Generation 2009 to 2018

Total Energy Use (Electricity and Gas) and Materiality

Executive Summary

• > Our gas use does not contribute significantly to our overall energy use. During 2017/18 it represented 6.4% of overall energy use.
• > It is anticipated that improved data monitoring processes in 2018/19 will allow us to understand drivers for gas variances better, specifically occupancy of our flexi-offices and the climatic temperature patterns.

Strategic Report (continued)

Corporate Social Responsibility Report (continued)

8.0 OUR ENVIRONMENT (continued)

Scope 1 and 2 Emissions Executive Summary

Total Scope 1 and 2 Emissions

• > We have reduced our Scope 2 emissions by 50.1% from our peak year 2011.
• > Reductions are due to both our energy efficiency programmes and more recently, compared to last year, due to a favourable UK fuel mix.
• > Our annual average carbon emission reductions from 2011 is approximately 7% per annum; more than double the target set for the commercial property sector to meet the UK Government's GHG emission target of a 34% reduction by 2020 (or a 3.5% reduction per annum to 2050).
• > In 2018 total Scope 1 and Scope 2 GHG Emissions achieved a reduction of 48.8% from our peak year 2011.This reduction is partly due to the increase in Scope 1 refrigerant efficiency and for Scope 2,the improved UK fuel mix and contributions from our Solar PV installations.
• > Scope 1 emissions from our stores represent only 4.2% of our combined Scope 1 and 2 emissions in 2018.
• > This year's refrigerant top up was significantly smaller than 2017.
• > Please note, Scope 1 and Scope 2 reference different years for their peak consumption for the combined emissions total we use 2011 as our benchmark year.

Scope 1 and 2 GHG Emission Intensity

Our GHG Emissions 'intensity' indicators are based on average customer occupancy (m2), total Group revenue (£) and gross internal floor area ("GIA" per m2).

Executive Summary

• > Our strongoccupancyandrevenuegrowthoverthelastfewyears arethekeydrivers forour verypleasingintensityimprovements.
• > OurGIA Intensityhas improvedby60%,ourOccupancyIntensitybyover70%fromourpeakyear2011, andourRevenueIntensitybyover72%.

Year ended 31 March	2011	2016	2017	2018	% change from 2011 Peak
Total (tCO2e)	6,879.5	4,456.2	4,126.9	3,520.5+	(48.8%)
Average Occupancy (m2)	197,884	304,964	325,537	344,566+	74.1%
kgCO2e /Occupancy	34.8	14.6	12.7	10.2+	(70.7%)
Revenue (£000)	61,885	101,382	109,070	116,660+	88.5%
kgCO2e / Revenue (£)	0.11	0.04	0.04	0.03+	(72.7%)
GIA (m2)	545,490	621,050	629,686	659,347	20.9%
kgCO2e / GIA (m2)	12.6	7.2	6.6	5.3+	(57.9%)

Please note: + indicates data reviewed by Deloitte LLP. See page 54 for their independent assurance report.

WATER

In-store use

Waterusehasbeenassessedas a "lowenvironmental impact"for self storage(weused28,486m3 ofwaterin2016).

Our data has provided an average of(20.3 tCO2e) emissions per year.This represents less than 0.5% of combined Scope 1 and 2 emissions,which is belowthematerialitythresholdfor carbonemissions.

However,waterusemonitoringis continuedinordertoreviewwateruseefficiency.

Flooding and Droughts

As part of our Climate Changemitigation and adaptation initiatives, our stores have features thattake the local aspects of 'water' into consideration – eitherbyincorporatingSustainableUrbanDrainageSystems (SUDs)orRainWaterHarvesting8(seeour Asset Listinour FullCSRReport2017/18).

Weconductdetailedsiteassessmentsthroughoutourplanning,acquisitionandconstructionphasestoensurerisksareadequatelymitigatedandour storeinfrastructurecancopewitha variablefuture.

⁸ Some of our stores may still show RWH although some may have been temporarily disconnected due to technical issues – we are looking to address these in the coming year

8.0 OUR ENVIRONMENT (continued)

WASTE

Waste Sources and Segregation

Our main source of waste is from the operational activities of our stores (mainly retail and office activities) and these have a relatively low environmental impact. Our store staff apply best practice waste segregation for general and mixed dry recyclable materials at our stores.

Executive Summary

• > Since our 'total waste' benchmark of 2011 (244t) our store portfolio has increased from 62 to 74 stores (an increase of 19.4%), and total waste has increased to 343t in 2018, an increase of 40.2% from 2011.
• > Our in-store recycling performance has declined we have issued all our stores with separate recycling bins and communication during 2017/18 and will seek to improve our recycling performance going forward.
• > We will be evaluating schemes for cardboard recycling during 2018/19.

New Store Construction 'Fit-out' Waste Management Performance

In 2018, Guildford Centralwas under construction 'Fit Out' phase and generated 51.3t sitewaste. 99.2% ofthewaste generatedwas recycled with plasterboard 100% recycled.

Guildford Central achieved a BREEAM SMART Waste Benchmarks Amount of waste tonnes per 100m2 of '3'.

RESOURCE USE

Big Yellowis committed to using its resources carefully tomeet our presentrequirementwithout compromising the ability offuture generations to meettheir own needs.

For the highlights section in this report, we would like to draw your attention to our single-use plastics initiatives. For the full report on Resource Use, please see the Full CSR Report 2017/18.

Plastic & Packaging Materials

Using good quality packaging materials that keeps our customers' possessions safe during transport is our primary reason for selling packaging material –we believe the benefit of keeping items intactthroughouttransport and storage can potentially outweigh the negative environmental impact of producing our packaging.

Wewantto make sure our customers can purchase our productswithout having toworry aboutthe potential negative impacts our products ortheir packaging has on the environment.We have been carefully selecting thematerialmake up of our boxes formany years,they contain up to 100% recycled card and this year we have moved onto other products.

Plastics

During 2018we conducted a reviewof potential single-use plastic and identified approximately 1,600kg ofmaterial,mainly containedwithin the packaging of the products we sell, for example the outer bag of our sofa covers.

Overthenextfour years,wewillworkwithour suppliers to replace the single-use plasticwithenvironmentally better alternatives,where available.

Corporate Social Responsibility Report (continued)

8.0 OUR ENVIRONMENT (continued)

GREEN STORE PORTFOLIO

Executive Summary

• > The performance of our Green Store portfolio has improved significantly during the year. 63.5% of our total gross internal area ("GIA") has an EPC performance of C or above.
• > We are furthermore making a commitment that all our new built stores will be assessed at a BREEAM standard of 'very good' or above (or the equivalent where the standard is not applicable) at pre-construction assessment stage.
• > All stores have energy efficient LED lighting (internal and external) and motion sensors.

	2017	2018	2025 Target	Trend
GIA covered by Green aspects (%)	41%	61%	100%	·
EPC ranking of A or B ratings in certified stores	76%	79%	100%	·
New-built Stores BREEAM pre-construction standards	No new	Guildford Central
'Very Good' or above	stores built	BREEAM very good		3

LEGISLATION & STANDARDS

LEGISLATION

Mandatory Greenhouse Gas (GHG) Emissions Statement

The ISAE 3000 Standard provides an evaluation methodology for both the quantitative and qualitative aspects of our carbon management and our energy use. We report our 'self storage' portfolio emissions and the 'absolute' emissions that include our 'non store portfolio'.

We report energy use and carbon emissions in compliancewith the Companies Act and Climate Change Regulation on Reporting Greenhouse Gas ("GHG") Emissions for listed companies.

For more details on our applications for the above benchmarks please see the 'Basis of Reporting' section of the CSR section of our Investor Relations website.

An overview of both the following schemes and our performance is provided in our Full CSR Report 2017/18:

• > Carbon Reduction Commitment(CRC) Scheme;
• > The UK Energy Savings Opportunities Scheme'(ESOS); and
• > Energy Performance Certificate (EPCs).

STANDARDS

We subscribe to the following standards (where relevant):

Building Research Establishment Environmental Assessment Methodology ('BREEAM')

We commit to a minimum standard on all new built stores of BREEAM 'Very Good' at pre-construction assessment stage.

Considerate Construction Scheme (CCS)

We committo all contractors signing up to CCS schemewith a target score of35points both fit out and shell,with an ambition to exceed expectations wherecircumstances allow.

European Public Real Estate Association (EPRA)

We report on our environmental key performance indicators and identify them using the codes from the Global Reporting Initiatives ('GRI'), as applied by the European Real Estate Association.

Global Reporting Initiative ('GRI') Standard

We have referenced a number of KPIs with the relevant GRI reference. We intend to publish a separate GRI table once our annual report has been published, so we can link answers and evidence.

HR specific indicators have already been published – please refer to theappendix intheFullCSRReport2017/18.

9.0 TARGETS

With the review of our CSR strategy, we have looked at our current targets and KPIs and assessed them against our new CSR programmes, material impacts andcurrent andemergingstakeholder concerns, suchas single-useplastic.

Atthesametime,werecognisethatournewstrategic areas, suchas 'Communities'requiredanewsetoftargets.

Wehavepublisheda reviewofpreviousyears'targets andournewtargets andcommitments inour FullCSRReport.

Weremaincommittedtothelong-termemissions reductiontargetsof34%by2020and80%by2050fromourbaselineyearof2008.

10.0STAKEHOLDERS

During2017/18BigYellowperformeda stakeholderreviewandhas refresheditsCSRstrategy.

Big Yellow has defined its material impacts to be on Customers, Employees, Suppliers, Communities and the Environment and it defines its wider stakeholdergrouptoincludeInvestors, LocalGovernment andNational andInternationalbodies.

Wedevelopedandpublisheda StakeholderEngagementPlan,whichweintendtoreviewandupdatefromtimetotime.

Formoreinformationonour stakeholderengagementprogrammes,pleaseseeour FullCSRReport2017/18.

11.0INVESTORS

TheGRESBandCDPbenchmarksinformourinvestorcommunityofourgeneralESGperformance,ourgovernanceapproach,riskmanagementprotocols anda rangeofotherindicators thatgivereassurancethatourbusiness is 'sustainable'.

Formoreinformationonthesebenchmarks,pleaseseethe'Benchmarks, LegislationandStandards' section.

Our Directors run a programme of face-to face investor's engagement activities by holding roadshows following annual and interim reporting cycles andattendInvestorConferences,bothintheUKandinternationally.

Thisyear,wehavechangedthefrontpageoftheInvestorsectionofourwebsitetoincludeourcsr@bigyellow.co.ukemailaddress.Wehopethatthiswill makeiteasierforourinvestors toask relevantCSRquestionsdirectly.

SINCE 2011, OUR SOLAR GENERATION HAS NEARLY TRIPLED. OUR SOLAR ENERGY USAGE IN STORES (WITH A SOLAR PV CAPACITY OF 50KWH) WAS 36.4%. WE REMAIN COMMITTED TO OUR SOLAR INVESTMENT STRATEGY.

Strategic Report (continued)

Corporate Social Responsibility Report (continued)

12.0INDEPENDENT ASSURANCE

What we did: our key assurance procedures

Considering the risk of material error, our multi-disciplinary team of CSR assurance specialists planned and performed our work to obtain all the information and explanations we considered necessary to provide sufficient evidence to support our assurance conclusion. Our work was planned to mirror Big Yellow's own group level compilation processes, tracing how data for each indicator within our assurance scope was collected, collated and validated by corporate head office and included in the Report.

Key procedures we carried out included:

• > Making inquiries of management to obtain an understanding of the overall governance and internal control environment relevant to management and reporting of the subject matter;
• > Understanding, analysing, and testing on a sample basis the key structures, systems, processes, procedures, and controls relating to the aggregation, validation and reporting of the subject matter set out above; and
• > Reviewing the content of the CSR Report 2018 against the findings of our work and making recommendations for improvement where necessary.

Big Yellow's responsibilities

The Directors are responsible for the preparation of the Report and for the information and statements contained within it. They are responsible for determining the CSR goals, performance and for establishing and maintaining appropriate performance management and internal control systems from which the reported information is derived.

Deloitte's responsibilities, independence and team competencies

Our responsibility is to independently express a conclusion on the performance data for the year ended 31 March 2018. We performed the engagement in accordance with Deloitte's independence policies, which cover all of the requirements of the International Federation of Accountants Code of Ethics and in some cases are more restrictive.The firm applies the International Standard on Quality Control 1 and accordingly maintains a comprehensive system of quality control including documented policies and procedures regarding compliance with ethical requirements, professional standards and applicable legal and regulatory requirements. We confirm to Big Yellow that we have maintained our independence and objectivity throughout the year, including the fact that there were no events or prohibited services provided which could impair that independence and objectivity in the provision of this engagement.

This report is made solely to Big Yellow in accordance with our engagement letter. Our work has been undertaken so that we might state to the company those matters we are required to state to them in an assurance report and for no other purpose.To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Big Yellow for our work, for this report, or for the conclusions we have formed.

Deloitte LLP London, United Kingdom 21 May 2018

Governance

Directors, Officers and Advisers

Executive Directors

Nicholas Vetch, Executive Chairman,was a co-founder of Big Yellowin September 1998. Priorto that, hewas joint Chief Executive of Edge Properties plc,which he co-founded in 1989, was subsequently listed on the Official List of the London Stock Exchange in 1996 and then sold to Grantchester Properties plc in 1998. He is also a Non-Executive Director of Local Shopping REIT plc and a Trustee of Global Human Rights and Global Human Rights UK.

James Gibson, Chief Executive Officer and co-founder of Big Yellow in September 1998. He is a Chartered Accountant by background having trained with Arthur Andersen & Co. where he specialised in the property and construction sectors, before leaving in 1989. He was Finance Director of Heron Property Corporation Limited and then Edge Properties plc which he joined in 1994. Edge Properties was listed on the Official List ofthe London Stock Exchange in 1996 and then sold to Grantchester Properties plc in 1998. He is also a Non-Executive Director and shareholder of AnyJunk Limited, a Non-Executive Director and shareholder of CityStasher Limited, a Non-Executive Director and investor inMoby Self Storage, a Brazilian Self Storage business, and a Trustee of the London Children's Ballet.

Adrian Lee, Operations Director, was previously a Senior Executive at Edge Properties plc, which he joined in 1996. Prior to that he was a corporate financier at Lazard for five years, having previously qualified as a surveyor at Knight Frank. He was appointed to the Board in May 2000.

John Trotman, Chief Financial Officer, is a Chartered Accountant having trainedwith Deloitte LLP,where he specialised in the real estate sector and self storage. On leaving Deloitte in 2005, John worked for a subsidiary of the Kajima Corporation. He joined Big Yellow in June 2007, and was appointed to the Board in September 2007. He is Chairman of the UK Self Storage Association.

Non-Executive Directors

Tim Clark, Non-Executive Director. He was a partner in Slaughter andMay, one of the leading international law firms in the world, for 25 years; initially working as a corporate and M&A adviser to a range of companies and institutions and then for the last seven years as senior partner (before retiring in April 2008). He is the Chair ofWaterAid UK, and a Senior Adviserto G3, and to Chatham House. He is also a member ofthe International Chamber of Commerce UK Governing Body, the Advisory Board of Uria Menendez, and is the Chair of the HighTide Theatre and is a member of the Development Committee of the National Gallery. He is Chairman of the trustees of the EconomistTrust. He was appointed to the Board in August 2008.

Richard Cotton, Non-Executive Director, headed the real estate corporate finance team at JP Morgan Cazenove until April 2009, and subsequent to that was a Managing Director of Forum Partners. Richard is currently the Senior Independent Director of Helical plc as well as a Member of the Commercial Development AdvisoryGroup ofTransportfor London.Richard joined theBoard in July2012, and is the SeniorIndependentDirector and Chairman oftheNominations Committee.

Georgina Harvey, Non-Executive Director, started her media career at Express Newspapers plc where she was appointed Advertising Director in 1994. She joined IPCMedia Ltd in 1995 andwent on to form IPC Advertising in 1998,where shewasManaging Director. Shewas a member ofthe Board of IPCMedia from 2000 and was Managing Director of the Regionals division ofTrinity Mirror from 2005 to 2012, overseeing its transition to a digital platform. She is currently a Non-Executive Director of William Hill plc and the Senior Independent Non-Executive Director and Chair of the Remuneration Committee of McColl's Retail Group plc. She joined the Board in July 2013 and is Chair of the Remuneration Committee.

Dr Anna Keay, Non-Executive Director, has been CEO of the Landmark Trust since 2012, operating a portfolio of 200 historic buildings let for holidays. She has a PhD from London University, starting her career at Historic Royal Palaces and from 2002 to 2012 she was Curatorial Director of English Heritage. She was a trustee of Leeds Castle Foundation from 2009 to 2016. She writes and broadcasts widely, presenting on history and buildings for Channel 4. She is a member of the NationalTrust Collection and Interpretation Advisory Group and is a Governor and Chair of the Buildings and Projects Committee at Bedales School. She joined the Board in March 2018.

Steve Johnson, Non-Executive Director, started his career at Bain in the 1980s before joining Asda in 1993,where he carried out a number ofroles, culminating in Marketing Director. He left Asda in 2000, to join GUS as a Sales & Marketing Director, departing in 2002 to take up his first CEO role at Focus DIY, where he remained until 2007. He joined Woolworths as part of the final turnaround team in late 2008. He has most recently been working as an operating executive for TPG, and was also the Executive Chairman of Dreams plc between July 2011 and October 2012. He is currently Executive Chairman of Poundworld. He joined the Board in September 2010.

Vince Niblett, Non-Executive Director,was the GlobalManaging Partner Auditfor Deloitte. He previously held a number of seniorleadership roleswithin Deloitte including as a member of the UK Board of Partners and of the Global Executive Group and the UK Executive Group before his retirement from Deloitte in May 2015. He was appointed to the Board in June 2017 and is the Chairman of the Audit Committee.

Company Secretary and Registered office Shauna Beavis 2 The Deans Bridge Road Bagshot Surrey GU19 5AT Company Registration No. 03625199 Bankers Lloyds Bank plc HSBC Bank plc Aviva Commercial Finance Limited M&G Investments Limited

Solicitors CMS Cameron McKenna Nabarro Olswang LLP Lester Aldridge LLP Slaughter and May

Financial advisers and stockbrokers

J P Morgan Cazenove

Statutory Auditor KPMG LLP

Chartered Accountant and Statutory Auditors

Valuers

Cushman & Wakefield LLP Jones Lang LaSalle

Directors' Report

The Directors present their annual report on the affairs of the Group, together with the audited financial statements and auditor's report for the year ended 31 March 2018.The Report on Corporate Governance on pages 60 to 63 forms part of this report.

Details of significant events since the balance sheet date are included in note 25 to the financial statements. An indication of likely future developments in the business of the Company is included in the Strategic Report.

Information about the use of financial instruments by the Company and its subsidiaries is given in note 18 to the financial statements.

Dividends

The Directors are recommending the payment of a final dividend of 15.5 pence per share forthe year(2017: 14.1 pence per ordinary share). An interimdividend of 15.3 pence per share was paid in the year(2017: 13.5 pence per share).

A property income dividend of 27.5 pence is payable for the year, of which 15.3 pence per share was paid with the interim dividend, and 12.2 pence per share was proposed for the final dividend.

Subject to approval by shareholders at the Annual General Meeting to be held on 19 July 2018, the final dividend will be paid on 27 July 2018.The Ex-div date is 21 June 2018 and the Record date is 22 June 2018.

From April 2016 dividend tax credits have been replaced by an annual £5,000 tax-free allowance on dividend income across an individual's entire share portfolio.This reduces furtherto £2,000 per annum from 1 April 2018. Above this amount, individualswill pay tax on their dividend income at a rate dependent on their income tax bracket and personal circumstances.The Company will continue to provide registered shareholders with a confirmation of the dividends paid by Big Yellow Group PLC and this should be included with any other dividend income received when calculating and reporting total dividend income received. It is the shareholder's responsibility to include all dividend income when calculating any tax liability.This change was announced by the Chancellor, as part of the UK government Budget, in July 2015.

Disclosure of Greenhouse Gas ("GHG") Emissions

Companies Act 2006; Climate Change, the GHG Emissions Director's Reports Regulations 2013

FromOctober 2013, all listed companies are required to report annual quantities of GHG emissions (measured as Carbon Dioxide Equivalent(CO2e)) as follows:

• > Scope 1 significant direct emission sources, such as our flexi-office gas heating and air conditioner coolant replacement currently fit out 'gas oil' use emissions and one Company van diesel fuel use emissions are assessed as 'not material';
• > Scope 2 significant indirect or offsite power station electricity supply emissions to our stores; and
• > Scope 3 Electricity supplier 'transmission and distribution' emissions currently, voluntary GHG emissions, from our waste and water supply chains are assessed as 'not material'.

Summary of Scope 1 and 2 Total Carbon Footprint (GHG carbon equivalent emissions (tCO2e))

Including store electricity, gas, coolant, generator gas oil and van diesel

Year	2013	2014	2015	2016	2017	2018
Total Scope 1 and 2 GHG Emissions (tCO2e)	6,470.0	5,681.8	4,908.0	4,456.2	4,126.9	3,520.5
Scope 3 Electricity Transmission Losses	501	445	417	355	357	312
Kg CO2e / Annual Revenue (£)	0.09	0.08	0.06	0.04	0.04	0.03
Kg CO2e / Customer Occupancy (m2)	26.5	22.6	17.3	14.6	12.7	10.2
Kg CO2e/GIFA m2	11.1	9.8	7.7	7.2	6.6	5.3

Note: Our materiality threshold for carbon emissions is > 5%

Further information on GHG emissions and on other sustainability initiatives at Big Yellow is provided in our Corporate Social Responsibility Report.

Capital structure

Details ofthe authorised and issued share capital,togetherwith details ofthemovements in the Company's issued share capital during the year are shown in note 22.The Companyhas one class of ordinary shareswhichcarryno rightto fixed income. Eachshare carries the rightto one vote at generalmeetings ofthe Company.

There are no specific restrictions on the size of a holding nor on the transfer of shares, which are both governed by the general provisions of the Articles of Association and prevailing legislation.The Directors are not aware of any agreements between holders ofthe Company's shares that may resultin restrictions on the transfer of securities or on voting rights.

Details of employee share schemes are set out in note 23, and details of shares held by the Company's Employee BenefitTrust are set out in note 22.

No person has any special rights of control over the Company's share capital and all issued shares are fully paid.

With regard to the appointment and replacement of Directors, the Company is governed by its Articles of Association, the Corporate Governance Code, the Companies Acts and related legislation. The Articles themselves may be amended by special resolution of the shareholders. The powers of Directors are described in the Report on Corporate Governance on page 60.

There are a number of agreements that take effect, alter or terminate upon a change of control of the Company such as commercial contracts, bank loan agreements, property lease arrangements and employee share plans.The Directors are not aware of any agreements between the Company and its Directors or employees that provide for compensation for loss of office or employment that occurs because of a takeover bid.

During the year the Company issued 687,707 shares to satisfy the exercise of share options (2017: 513,580).

Directors' Report (continued)

Directors

The Directors of the Company who served throughout the year and to the date of approval of the financial statements, except as noted below, were as follows:

Tim Clark	Non-Executive Director
Richard Cotton	Senior Independent Director
James Gibson	Chief Executive Officer
Georgina Harvey	Non-Executive Director
Steve Johnson	Non-Executive Director
Anna Keay	Non-Executive Director(appointed 1 March 2018)
Adrian Lee	Operations Director
Vince Niblett	Non-Executive Director(appointed 1 June 2017)
Mark Richardson	Non-Executive Director(resigned 20 July 2017)
John Trotman	Chief Financial Officer
Nicholas Vetch	Executive Chairman

Biographical details of the Executive and Non-Executive Directors standing for re-election are set out on page 56.

Directors' indemnities

The Company purchases liability insurance covering the Directors and officers of the Company and its subsidiaries.

Political contributions

No political donations were made by the Company in either the current or preceding financial year.

Substantial shareholdings

The Company had been notified, in accordance with Chapter 5 of the Disclosure and Transparency rules, of the following voting rights as a shareholder of the Company at 31 March 2018 and 21 May 2018.

	No. of ordinary shares 31 March 2018	Percentage of voting rights and issued share capital 31 March 2018	No. of ordinary shares 21 May 2018	Percentage of voting rights and issued share capital 21 May 2018
Blackrock Inc	13,755,183	8.67%	13,748,770	8.67%
Standard Life Aberdeen	8,945,746	5.64%	9,051,814	5.70%
Old Mutual Plc	8,516,661	5.37%	8,129,690	5.13%
Cohen & Steers Inc	7,286,788	4.59%	8,262,030	5.20%
Ameriprise Financial Inc	7,269,648	4.58%	6,698,495	4.22%
PGGM Investments	5,490,776	3.46%	5,531,776	3.49%
The Vanguard Group Inc	5,447,394	3.44%	5,490,922	3.46%

The interest of the Directors in the share capital of the Company is shown on page 82 of the Remuneration Report.

Purchase of own shares

The Company was granted authority at the AGM in 2017 to purchase its own shares up to a total aggregate value of 10% of the issued nominal capital. That authority expires at this year's AGM and a resolution will be proposed for its renewal. During the year the Company made no purchases of its own shares.

Employee consultation

The Group seeks to ensure employee commitment to its objectives in a number of ways. Strategic changes are communicated directly to all staff who are encouraged to address queries to the Executive Directors.The Directors' executive meetings are frequently held in stores and in addition Directors and senior management visit the stores on a regular basis. Furthermore, there are regular team briefings at store level to provide employees with information about the performance of and initiatives in their store. A wide range of information is also communicated across the Group's Intranet, including the e-publication of the Group's financial results and all press releases, the publication of a quarterly newsletter, and the publication of a weekly operations bulletin.

The Board is cognisant of the new Corporate Governance proposals for more formal employee engagement, requiring it to gather the views of the workforce. The options current proposed involve (i) having a designated Non-Executive Directorto gatherthe views from, for example, an employee forum; or(ii) appointing a formal workforce advisory panel; or(iii) having a Director appointed from the workforce.The Group is assessing these options and will report further in next year's annual report.

Employees are encouraged to participate in the Group's performance through Employee Share Schemes and performance related bonuses. 50% of eligible employees participate in the Group's Sharesave Scheme.

The Group's recruitment policy is committed to promote equality, judging neither by race, nationality, religion, age, gender, disability, sexual orientation, nor political opinion and to treat all stakeholders fairly.

Disabled employees

Applications for employment by disabled persons are always fully considered, bearing inmind the aptitudes ofthe applicant concerned. In the event ofmembers of staff becoming disabled every effortismade to ensure thattheir employmentwith the Group continues and that appropriate training is arranged. Itis the policy ofthe Group that the training, career development and promotion of disabled persons should, as far as possible, be identical to that of other employees.

Human Rights

Big Yellow respects Human Rights and aims to provide assurance to internal and external stakeholders that we are committed to human rights and the principles of the Universal Declaration of Human Rights.

We are committed to creating and maintaining a positive and professional work environment that reflects and respects the basic rights of freedom to lead a dignified life, free from fear or want, and where stakeholders are free to express their independent beliefs. Our employment policies and practices reflect a culture where decisions are made solely on the basis of individual capability and potential in relation to the needs of the business.

Modern Slavery Act

The Group is committed to ensuring that there is no modern slavery or human trafficking in our supply chains or in any part of our business. Our Anti-slavery Policy reflects our commitment to acting ethically and with integrity in all our business relationships and to implementing and enforcing effective systems and controls to ensure slavery and human trafficking is not taking place anywhere in our supply chains. Our policy is published in full on our website.

Auditor

In respect of each Director of the Company, at the date when this report was approved, to the best of their knowledge and belief:

• > so far as each Director is aware, there is no relevant audit information of which the Company's auditor is unaware; and
• > each Director has taken all the steps that he/she might have reasonably been expected to take as a Director in order to make himself/herself aware of any relevant audit information and to establish that the Company's auditor is aware of that information.

This confirmation is given and should be interpreted in accordance with s418 of the Companies Act 2006.

Approved by the Board of Directors and signed on behalf of the Board

Shauna Beavis Company Secretary 21 May 2018

Corporate Governance Report

INTRODUCTION

The Company is committed to the principles of corporate governance contained in the UK Corporate Governance Code thatwas issued in 2014 by the Financial Reporting Council ("the Code") for which the Board is accountable to shareholders. The Board also takes account of the corporate governance guidelines of institutional shareholders and their representative bodies.

At Big Yellow, we aim to create a culture in which integrity, openness and fairness are rewarded.

We continue to review the composition of the Board to ensure that it has the appropriate skills, knowledge and balance for the effective stewardship of the Company.The Board has overall responsibility for the manner in which the Company runs its affairs.

Statement of compliance with the Code

Throughout the year ended 31 March 2018, the Company has been in compliance with the Code provisions set out in section 1 of the 2014 UK Corporate Governance Code.

Statement about applying the principles of the Code

The Company has applied the principles set out in the Code, including both the main principles and the supporting principles, by complying with the Code as reported above. Further explanation of how the principles and supporting principles have been applied is set out below and in the Nominations Committee Report, the Remuneration Report and the Audit Committee Report.

LEADERSHIP

The Board's role is to provide entrepreneurial leadership ofthe Companywithin a framework of prudent and effective controlswhich enables risk to be assessed and managed.

Chairman and Chief Executive

The division of responsibilities between the Chairman and the Chief Executive has been agreed by the Board and encompasses the following parameters:

• > the Chairman's role is to provide continuity, experience, governance and strategic advice, while the Chief Executive provides leadership, drives the dayto-day operations of the business and works with the Chairman on overall strategy;
• > the Chairman,workingwith the SeniorIndependent Non-Executive Director, is viewed by investors as the ultimate steward ofthe business and the guardian of the interests of all the shareholders;
• > the Board believes that the Chairman and the Chief Executive work together to provide effective and complementary stewardship;
• > the Chairman:
• > takes overall responsibility for the composition and capability of the Board;
• > takes overall executive responsibility for the property development team; and
• > consults regularly with the Chief Executive and is available on a flexible basis for providing advice, counsel and support to the Chief Executive.
• > the Chief Executive:
• > manages the Executive Directors and the Group's day-to-day activities;
• > prepares and presents to the Board strategic options for growth in shareholder value;
• > sets the operating plans and budgets required to deliver agreed strategy; and
• > ensures that the Group has in place appropriate risk management and control mechanisms.

The Directors believe it is essential for the Group to be led and controlled by an effective Board that provides entrepreneurial leadership within a framework of sound controls which enables risk to be assessed and managed.The Board is responsible for setting the Group's strategic aims, its values and standards and ensuring the necessary financial and human resources are in place to achieve its goals. The Board ensures that its obligations to shareholders and other stakeholders are understood and met.The Board also regularly reviews the performance of management.

EFFECTIVENESS

Composition of the Board

The Nominations Committee is responsible for reviewing the Board Composition, and makes recommendations to the Board on the appointment of Directors. There are presently six independent Non-Executive Directors on the Board, with Richard Cotton being the Senior Independent Director.The Company complies with the Combined Code in that at least half ofThe Board is comprised of independent Non-Executive Directors.

All ofthe Non-Executive Directors bring considerable knowledge, judgement and experience to Board deliberations. Non-Executive Directors do not participate in any of the Company's share option or bonus schemes and their service is non-pensionable.The Non-Executive Directors are encouraged to communicate directly with Executive Directors between formal Board meetings. The Non-Executive Directors meet at least once a year without the Executive Directors being present.

The Non-Executive Directors scrutinise the performance of management in meeting agreed goals and objectives and monitor the reporting of performance. They are required to satisfy themselves on the integrity of the financial information and that financial controls and systems of risk management are robust and defensible.They are responsible for determining appropriate levels ofremuneration for Executive Directors and have a prime role in appointing and,where necessary, removing Executive Directors, and in succession planning.

EFFECTIVENESS (continued)

Composition of the Board (continued)

The tenure of the independent Non-Executive Directors at 31 March 2018 is set out below:

Changes to the Board and its Committees

Mark Richardson retired fromthe Board atthe 2017 Annual GeneralMeeting. Vince Niblettwas appointed to the Board in June 2017, succeedingMark Richardson as Audit Committee Chairman.

The Board also appointed Anna Keay in March 2018 to serve as an independent Non-Executive Director.

Tim Clark has informed the Board of his decision to retire from the Board with effect from the forthcoming Annual General Meeting.

THE BOARD AND ITS COMMITTEES

Standing committees of the Board

The Board has Audit, Remuneration and Nominations Committees, each of which has written terms of reference.They deal clearly with the authorities and duties of each Committee and are formally reviewed annually. Copies of these terms of reference are available on the Company's website. Each of these Committees is comprised of Independent Non-Executive Directors of the Company who are appointed by the Board on the recommendation of the Nominations Committee.

All ofthe Committees are authorised to obtain legal or other professional advice as necessary;to secure,where appropriate,the attendance of external advisers at its meetings and to seek information required from any employee of the Company in order to perform its duties.

The Chairman of each Committee reports the outcome of the meetings to the Board.The Company Secretary is secretary to each Committee.

Attendance at meetings of the individual Directors at the Board Meetings that they were eligible to attend is shown in the table below:

Director	Position	Number of meetings attended
Tim Clark	Non-Executive Director
Richard Cotton	Non-Executive Director
James Gibson	Chief Executive Officer
Georgina Harvey	Non-Executive Director
Steve Johnson	Non-Executive Director
Anna Keay	Non-Executive Director
Adrian Lee	Operations Director
Vince Niblett	Non-Executive Director
Mark Richardson	Non-Executive Director
John Trotman	Chief Financial Officer
Nicholas Vetch	Executive Chairman

attended

absent

THE BOARD AND ITS COMMITTEES (continued)

Standing committees of the Board (continued)

The Board meets approximately once every two months to discuss awhole range of significant matters including strategic decisions, major asset acquisitions and performance. A procedure to enable Directors to take independent professional advice if required has been agreed by the Board and formally confirmed by all Directors.

There is a formal schedule ofmatters reserved forthe Board's attention including the approval of Group strategy and policies;major acquisitions and disposals, major capital projects and financing, Group budgets and material contracts entered into otherthan in the normal course of business.The Board also considers matters of non-financial risk as part of its review of the Group's risk register.

At each Board meeting,the latest available financial information is producedwhich consists of detailed management accountswith the relevant comparisons to budget. A current trading appraisal is given by the Executive Directors.

Information and professional development

All Directors are provided with detailed financial information throughout the year. On a weekly basis they receive a detailed occupancy report showing the performance of each of the Group's open stores. Management accounts are circulated to the Executive monthly and a detailed Board pack is distributed a week prior to each Board meeting.

All Directors are kept informed of changes in relevant legislation and changing commercial risks with the assistance of the Company's legal advisers and auditorwhere appropriate.The professional developmentrequirements of Executive Directors are identified and progressed as part of each individual's annual appraisal. All new Directors are provided with a full induction programme on joining the Board.

Non-Executive Directors are encouraged to attend seminars and undertake externaltraining atthe Company's expense in areas they considerto be appropriate fortheir own professional development. Each year,the programme of senior management meetings is tailored to enable meetings to be held atthe Company's properties. During the year, the Executive Directors made visits to all of the Group's stores.

ACCOUNTABILITY

Risk management and internal control

The Group operates a rigorous system of risk management and internal control, which is designed to ensure that the possibility of misstatement or loss is keptto a minimum.There is a comprehensive system in place forfinancialreporting and the Board receives a number ofreports to enable itto carry outthese functions in the most efficient manner. These procedures include the preparation of management accounts, forecast variance analysis and other ad hoc reports.There are clearly defined authority limits throughout the Group, including those matters which are reserved specifically for the Board.

The Board has applied principle C.2 of the UK Corporate Governance Code by establishing a continuous process for identifying, evaluating and managing the significant risks the Group faces and for determining the nature and extent of the significant risks it is willing to take in achieving its strategic objectives.The Board regularly reviews the process, which has been in place from the start of the year to the date of approval of this report and which is in accordance with revised guidance on internal control published in October 2005 (the Turnbull Guidance).The Board is also responsible forthe Group's systemof internal control and forreviewing its effectiveness. Such a system is designed to manage ratherthan eliminate the risk of failure to achieve business objectives, and can only provide reasonable and not absolute assurance against material misstatement or loss.

In compliance with provision C.2.1 of the Code, the Board regularly reviews the effectiveness of the Group's risk management and internal control systems. The Board's monitoring covers all controls, including financial, operational and compliance controls and risk management. Itis based principally on reviewing reports from management to consider whether significant risks are identified, evaluated, managed and controlled and whether any significant weaknesses are promptly remedied and indicate a need for more extensive monitoring.The Board has also performed a specific assessmentforthe purpose ofthis annual report.This assessment considers all significant aspects of risk management and internal control arising during the period covered by the report, including the work carried out by the Group's Store Compliance team.The Audit Committee assists the Board in discharging its review responsibilities.

A formalrisk identification and assessment exercise has been carried outresulting in a risk framework document summarising the key risks, potential impact and the mitigating factors or controls in place.The Board have a stated policy of reviewing this risk framework at least once a year or in the event of a material change.The risk identification process also considered significant non-financial risks.

During the reviews, the Directors:

• > challenged the framework to ensure that the list of significant risks to business objectives is still valid and complete;
• > considered new and emerging risks to business objectives and included them in the framework if significant;
• > ensured that any changes in the impact or likelihood of the risks are reflected in the risk framework; and
• > ensured that there are appropriate action plans in place to address unacceptable risks.

The results of this exercise have been communicated to the Board and the Audit Committee.This was in the form of a summary report which included:

• > a prioritised summary of the key risks and their significance;
• > any changes in the list of significant risks or their impact and likelihood since the last assessment;
• > new or emerging risks that may become significant to business objectives in the future;
• > progress on action plans to address significant risks; and
• > any actual or potential control failures or weaknesses during the period (including "near misses").

During the course of its review of the risk management and internal control systems, the Board has not identified, nor been advised of any failings or weaknesses which it has determined to be significant, consistent with the prior year.Therefore, a confirmation in respect of necessary actions has not been considered appropriate.

GOING CONCERN

The Group's activities, and a fair review of the business, are included in the Strategic Report on pages 16 to 28.The financial position of the Group, including its cash flow, liquidity, and committed debt facilities are discussed in the Financial Review on pages 29 to 38.

The Directors have a reasonable expectation that the Group and Company have adequate resources to continue operations for the foreseeable future. They have therefore continued to adopt the going concern basis in preparing the financial statements.

SHAREHOLDER RELATIONS

The Board aims to achieve clearreporting of financial performance to all shareholders and acknowledges the importance of an open dialogue by both Executive and Non-Executive Directors with its institutional shareholders.The Board believes that the Annual Report and Accounts play an important part in presenting all shareholders with an assessment of the Group's position and prospects.

The Company has an active dialogue with its shareholders through a programme of investor meetings which include formal presentation of the full and half year results.The Executive Directors have participated in investor conferences and meetings during the year throughout the United Kingdom, and also in the United States and the Netherlands. During the year ended 31March 2018,the Chief Executive and other Executive Directors carried out 196 meetings with UK and overseas institutional shareholders and potential investors.These meetings comprised group and individual presentations and tours of our stores.

The Board also welcomes the interest of private investors and believes that, in addition to the Annual Report and the Company's website, the Annual General Meeting is an ideal forum at which to communicate with investors and the Board encourages their participation. At each Board Meeting, the Board is updated on any shareholding meetings that have taken place, and any views expressed or issues raised by the shareholders in these meetings.

Any queries raised by a shareholder, either verbally or in writing, are answered immediately by whoever is best placed on the Board to do so. Directors are introduced to shareholders at the AGM, including the identification of Non-Executive Directors and Committee Chairmen. The number of proxy votes cast in the resolution is announced at the AGM.

Report of the Nominations Committee

Introduction

The Committee is responsible for reviewing the Composition of the Board. It also makes recommendations for membership of the Board and considers succession planning for Directors.The Committee is also responsible for evaluating Board and Committee performance.

Committee members and attendance

Member	Position	Number of meetings attended
Tim Clark	Member
Richard Cotton	Chairman and Senior Independent Director
Georgina Harvey	Member
Steve Johnson	Member
Anna Keay	Member (from 1 March 2018)
Vince Niblett	Member (from 1 June 2017)
Mark Richardson	Member (to 20 July 2017)

attended

absent

The Nominations Committee is responsible for reviewing the structure, size and composition ofthe Board and giving consideration to succession planning for Directors and other senior Executives.Where changes are required, itis also responsible forthe identification, selection and proposalto the Board for approval of persons suitable for appointment orreappointmentto the Board,whether as Executive orNon-Executive Directors and to seek approvalfromthe Remuneration Committee ofthe remuneration and terms and conditions of service of any proposed Executive Director appointment.The Chairman ofthe Committee reports to the Board as appropriate to enable the Board as awhole to agree the appointments of newDirectors.The Committeemeets atleast once a year and otherwise as required and as determined by its members.

The terms and conditions of appointmentforthe Non-Executive Directors is available forinspection atthe Company's Head Office during normalworking hours. They are also available for inspection at the Company's AGM.

During the year, Vince Niblett's and Anna Keay's appointments to the Board were approved by the Nominations Committee.

Board performance evaluation

During the prior year the Board engaged Lomond Consulting to undertake an evaluation of the performance of the Board and its Committees.The aim was to seek to identify areas where the performance and the procedures of the Board may be improved.The scope of the review was agreed between the Chairman of the Committee and the Chief Executive.

Each Director completed a questionnaire on the performance of the Board, its Committees and the Chairman. Each Director was then interviewed in person by Lomond Consulting.The responses were anonymous to enable an open and honest sharing of views. Lomond Consulting then produced a report showing the results of the review.

The key topic discussed as part of the review was succession planning, which is further discussed in the section below, albeit the Committee considered no further action was necessary.

During the current year, the Executive Chairman evaluated the performance of the other Executive Directors, and the performance of the Chairman was evaluated by the Senior Independent Non-Executive Director. It was considered that the individuals, the Committees and the Board as a whole were operating effectively, with appropriate procedures put in place for minor areas identified for improvement.

Succession planning

The Board comprises a team of four Executive Directors,two ofwhom were co-founders ofthe Company, complemented by Non-Executive Directorswho have wide business experience and skills as well as a detailed understanding of the Group's philosophy and strategy. Continuity of experience and knowledge, particularly of self storage, within the executive team is particularly important in a focussed long-term business such as Big Yellow.

It is a key responsibility of the Committee to advise the Board on succession planning. The Committee ensures that any future changes in the Board's composition are foreseen and effectivelymanaged. In the event of unforeseen changes,the Committee ensures thatmanagement and oversight ofthe Group's business and long-term strategy will not be affected.

The Committee also addresses the development and continuity of the Senior Management team below Board level.

Policy on diversity

All aspects of diversity, including gender are considered at every level of recruitment. All appointments to the Board are made on merit. The Board's policy states thatthe Board seeks a compositionwith the right balance of skills and diversity tomeetthe demands ofthe business.The Board considers itis important to increase the representation of women on the Board, and intends to increase the proportion of women on the Board in the medium term, but does not consider that quotas are appropriate and has therefore chosen not to set targets. The Board has recruited a female Non-Executive Director, Anna Keay, to replace Tim Clark who retires from the Board in July.

Gender diversity of the Board and Company is set out below (senior management are defined to be Heads of Department):

	Male	Female	Total
Board	8	2	10
Senior Management	6	6	12
All employees	214	162	376

Directors standing for re-election

All of the Directors will retire in accordance with the UK Corporate Governance Code and, with the exception ofTim Clark, will offer themselves for re-election at the Annual General Meeting.

Following a performance appraisal process,the Board has concluded thatthe Directors retiring are effective, committed to theirroles and operate as effective members of the Board.

The Board, on the advice of the Committee, therefore recommends the re-election of each Director standing for re-election. Full biographical details of each Director are available on page 56.

Richard Cotton

Nominations Committee Chairman

Remuneration Report

Year ended 31 March 2018

INTRODUCTION

This report details the activities of the Remuneration Committee for the period from 1 April 2017 to 31 March 2018.

The report has been prepared by the Remuneration Committee and approved by the Board.

It sets out the proposed Remuneration Policy for which the Committee is seeking approval at the forthcoming AGMand remuneration details for the Executive and Non-ExecutiveDirectors ofthe Company(bothinterms ofhowthe existingPolicyhasbeenoperatedandhowtheproposedPolicywill operate). Ithasbeenprepared in accordancewith Schedule 8 ofthe Large andMedium-size Companies and Groups (Accounts and Report)(Amendment) Regulations 2013 (the "Regulations").

The report is divided into three main sections:

• > The Annual Statement which summarises the remuneration outcomes in the year ended 31 March 2018, the proposed new Remuneration Policy and how it will be operated in the year ending 31 March 2019;
• > The Remuneration Policy Report which sets out the proposed Remuneration Policy for which shareholder approval will be sought at the 2018 AGM; and
• > The Annual Report on Remuneration which sets out how the Committee intends to operate the Remuneration Policy for the year ending 31March 2019, the link between Company performance and remuneration forthe year ended 31March 2018 and payments and awards made to the Directors in respect of the year just ended.

The Companies Act 2006 requires the auditor to report to the shareholders on certain parts of the Remuneration Report and to state whether, in their opinion, those parts of the report have been properly prepared in accordance with the Regulations.The parts of the Annual Report on Remuneration that are subject to audit are indicated in the report.The Annual Statement by the Remuneration Committee Chair and the Remuneration Policy Report are not subject to audit.

The Committee and its Work During the Year

Committee Chair:Tim Clark (to 19 July 2017), Georgina Harvey (from 20 July 2017)

Committee members: Tim Clark (from 20 July 2017), Richard Cotton, Georgina Harvey (until 19 July 2017), Steve Johnson, Mark Richardson (until 20 July 2017), Vince Niblett(from 1 June 2017) and Anna Keay (from 1 March 2018)

Terms of Reference: www.corporate.bigyellow.co.uk/investors/governance/remuneration-policy.aspx

The Committee met four times during the year under review.

The Committee's main activities during the year ended 31 March 2018 (full details are set out in the relevant sections of this report)included:

• > Agreeing Executive Director base salary increases from 1 April 2017 (2%);
• > Agreeing the annual bonus pay-outforthe year ended31March2017and setting the targets forthe annual bonus forthe year ended31March2018;
• > Reviewing the interim performance targets in respect of the Long Term Bonus Performance Plan ("LTBPP") awards which had a three-year performance period ended 31 March 2018;
• > Reviewing the EPS and Total Shareholder Return ("TSR") performance targets and determining the percentage vesting for the 2014 LTIP awards which vested in 2017;
• > Reviewing the Company's Gender Pay calculations and draft disclosures; and
• > Reviewing the Remuneration Policy and consultingwith the Company's major shareholders and representative bodies in respect ofthe proposed Remuneration Policy which will be taken to shareholders for approval at the 2018 AGM.

ANNUAL STATEMENT

Dear Shareholder

I am pleased to present the Directors' Remuneration Report for the year ended 31 March 2018.This is my first report as Chair of the Committee and I would like to thank Tim Clark, who chaired the Committee for nine years, for all of his hard work.

Atthe 2018 AGM,wewill be tabling a binding resolution to seek shareholder approvalto update our existing Directors' Remuneration Policy, forwhich shareholder approval was originally obtained in 2015. A binding resolution will also be tabled to seek approval for the establishment of a Deferred Share Bonus Plan to enable part of the annual bonus to be deferred into shares for a period of time. In addition, the regular advisory resolution to approve the Annual Report on Remuneration will also be tabled.

Performance, Decisions and Reward Outcomes for the year ended 31 March 2018

The business conditions and performance ofthe Group in the year ended 31March 2018 are describedmore fully in the Chairman's Statement and the Operating and Financial Review of this Annual Report. In summary:

• > The business of the Group performed strongly;
• > Big Yellow is the clear UK brand leader in self storage and delivered growth in occupancy, cash flow and earnings for the ninth year in a row;
• > Revenue, cash flow and adjusted profit before tax increased by 7%, 13% and 12% respectively;
• > Like-for-like occupancy increased by 3.9 ppts; and
• > Dividends are being increased by 12%.

This strong performance has been reflected in the annual bonus award and share awards which vested in the year ended 31 March 2018.

Performance, Decisions and Reward Outcomes for the year ended 31 March 2018 (continued)

Payments made to the Executive Directors under the annual bonus plan amounted to 12.9% of salary (out of a maximum of 25% of salary), based on performance against pre-settargets for occupancy, store profitability, store audits and customer satisfaction.The targets set, and the out-turnwere consistent with the average bonus awarded across the stores and head office.

As a result ofthe Long TermBonus Performance Plan (LTBPP) awards reaching the end ofthe three-year performance period to31March2018,93.3% ofthe awards are expected to vestin August 2018 based on strong performance against financial and non-financial performance targets linked to the business plan.

In respect of the Long-Term Incentive Plan (LTIP) awards granted in 2014, which vested in July 2017, three-year EPS and TSR performance resulted in 100% of awards vesting.

Further details ofthe targets, and performance againstthe targets, for annual bonus pay-outs and share award vesting levels are set outin the Annual Report on Remuneration.

Remuneration Policy Review

Big Yellow has sought to offer a remuneration policy for its Executive Directors close to, but generally below market levels. However, packages in practice and salary levels in particular, have been significantly below market levels in recent years. In addition, the Policy has been at the more complicated end of market practice due to the operation of three incentive plans, being an annual bonus, a conventional LTIP granted annually and LTBPP whereby awards have been granted every three years. It is against this background and the sensitivities surrounding the executive pay debate that the Committee has reviewed Big Yellow's Remuneration Policy, which has been in place since it was formally approved by shareholders at the 2015 AGM.

Following the completion of its review,the Committee has concluded thatthe currentincentive arrangements are overly complicated in terms of administration and communication and the current salary positioning is no longer sustainable (and risks creating significant issues in future in respect of both retention and recruitment). As such, the Committee wishes to simplify the Remuneration Policy and align it to a more conventional approach in respect of fixed and variable pay which better reflects Big Yellow (in terms of maturity, size and complexity) and individual contributions (in terms of each individual's relative responsibilities and roles).

The Committee is therefore proposing:(i) a major simplification (and reduction, in percentage of salary terms) of Big Yellow's incentive arrangements;(ii) certain adjustments to Executive Director base salary levels to more appropriate and fair levels;(iii) a reduction to Executive Director pension provision in support of the Investment Association's encouragementfor pension alignmentinternally; and (iv) additional/enhanced shareholder protections to update the Policy.

Summary of the Proposed Changes

While details ofthe proposed changes to the Remuneration Policy and its implementation are set outin detail in the Directors' Remuneration Policy and Annual Report on Remuneration, in summary, the key changes are:

> Simplified incentive arrangements – the LTBPP, whereby awards are granted every three years, with performance targets set annually and reviewed at the end of each financial year and end of the three-year period, will be replaced by a conventional deferred annual bonus arrangement. Rather than enabling a grant of up to 675% of salary every three years (providing the average award level across the four Executive Directors does not exceed 450% of salary award every three years), it is proposed that going forward, subject to shareholder approval, the LTBPP is consolidated into the annual bonus (albeitwith significant deferral). As such,the annual bonuswill be capped at 150% of salarywith the existing 25% of salary continuing to be aligned to the workforce cash annual bonus (measured through occupancy growth, store profitability, store audits and customer satisfaction scores), and the remaining 125% of salary (measured against financial, operational, real estate and strategic targets) deferred into Big Yellow shares for three years (with vesting subject to continued employment).

Full details of the performance targets set, and Big Yellow's performance against those targets with resulting pay-outs, will normally be disclosed in the relevant Remuneration Report for the year just ended. Alternatively, if the targets are considered to be commercially sensitive, they will be disclosed at the point the Committee considers that they have ceased to be so.

> Phased base salary increases – Executive Director base salaries will be increased over three years, to more closely reflect each Executive Director's role and contribution to Big Yellow and Big Yellow's size and complexity, which has increased significantly. While the Committee has operated a policy of targeting base salaries "close to (but generally just below)median"for some time, actual salaries have been set significantly belowmedian levels. Following a review of Executive Director base salary levels as part of the Remuneration Policy review, the Remuneration Committee has concluded that current salary levels are no longer reflective of each individual's role and responsibilities in a company of Big Yellow's size and complexity given the increase in: (i) the number of stores; (ii) the geographical spread, (iii) the employee base; (iv) customers; (v) revenue; and (vi) profits over the last ten years). As such, and in connection with the simplification and de-gearing of incentive potential as part of the Remuneration Policy review, the following base salary increases are proposed:

	Chief Executive (James Gibson)	Executive Chairman (Nicholas Vetch)	Chief Financial Officer (John Trotman)	Operations Director (Adrian Lee)
Current	£302,000	£275,200	£223,700	£223,700
From 1 April 2018	£350,000	£315,000	£260,000	£250,000
From 1 April 2019	£400,000	£350,000	£300,000	£270,000
From 1 April 2020	£440,000	£375,000	£325,000	£285,000

Remuneration Report (continued)

Year ended 31 March 2018

Summary of the Proposed Changes (continued)

The Committee considers the proposed base salary levels to be more appropriate in light of each individual's role and contribution to Big Yellow and Big Yellow's size and complexity (although they remain conservatively positioned against the sector and market more generally). Further, in addition to his Executive Chairman role, it should also be noted that Nicholas Vetch has also taken on executive responsibility for the property team in the past year, covering both property acquisitions and development.

The proposed salary increases are neither post freeze catch-up awards, nor are they benchmarking driven and while the Committee had originally intended to increase salary levels from 1 April 2018 and 1 April 2019, the Committee has decided to phase the salary increases over three years following feedback received from a number of investors during consultation.

Further, in line with best practice, the increases from 1 April 2019 and 1 April 2020 are not guaranteed but will be subject to satisfactory Group and individual performance during the years ending 31 March 2019 and 31 March 2020. Other than for a material role change, subsequent salary increases are expected to be in line with the general workforce increases.

• > Reduced pension provision Reflecting the proposed base salary increases and the Investment Association's recent encouragementfor company pension provision to be aligned to that provided to the general workforce (as a percentage of salary), Executive Director pension provision will be reduced from 15% of salary (with a policy maximum of 20% of salary)to 10% of salary (being the pension provided for the Company's Department Heads).
• > Enhanced shareholder protection A two-year post vesting holding periodwill be introduced on future LTIP awards granted to Executive Directors following the 2018 AGM. Further,withholding and recovery provisions (malus and clawback)will be added to the annual(and deferred) bonus plan and the existing provisions in the LTIP will be updated and enhanced where necessary. Shareholding guidelines will remain at 200% of salary.

Shareholder Consultation Exercise and 2018 AGM Resolutions

The Remuneration Committee has carefully considered the proposed policy on executive remuneration and the implementation of the approach underlying that policy during the year ending 31 March 2019. This has included an extensive consultation exercise with Big Yellow's top 15 investors and the major shareholder representative bodies and I would like to take this opportunity to thank them for their constructive and very positive feedback on the proposals, which the Committee considered and which helped formulate the final policy that is being put to shareholders for approval.

I therefore hope that, at the AGM on 19 July 2018, you will support:

• > the binding resolution on the revised Directors' Remuneration Policy contained within this Remuneration Report;
• > the binding resolution on the establishment of a Deferred Share Bonus Plan to enable a significant part of the annual bonus to be deferred into shares for a period of time; and
• > the advisory resolution on the remuneration paid to the Directors in the last financial year, and implementation of the new Remuneration Policy for the forthcoming year as set out in the Annual Remuneration Report section of this Remuneration Report.

Finally, I would like to extend my thanks to my fellow colleagues on the Committee for their support and work in 2017/18.

Georgina Harvey

Chair of the Remuneration Committee 21 May 2018

REPORT ON DIRECTORS' REMUNERATION POLICY

This section of the Remuneration Report contains details of the Company's Directors' Remuneration Policy (the "Policy") which will govern the Company's approach to remuneration. Following a remuneration review conducted by the Committee, a revised Remuneration Policy is being proposed which will be put to shareholders for approval at the Company's AGM on 19 July 2018.

Itis the policy ofthe Company to ensure thatthe executive remuneration packages are designed to attract, motivate and retain Directors of a high calibre and reward the executives for enhancing value to shareholders.

As a result, a substantial element ofthe remuneration ofthe Executive Directors is structured to be dependent on the performance ofthe Company.The policy aims to support a performance culture where there is appropriate reward for the achievement of strong Company performance without creating incentives which will encourage excessive risk-taking or unsustainable Company performance.

Policy Scope

The Policy applies to the Executive Directors and Non-Executive Directors.

Policy Duration

The newDirectors' Remuneration Policy Reportwill be putto a binding shareholder vote atthe AGMon 19 July 2018 and, subjectto receivingmajority shareholder support,the Policywill apply fromthe date of approval and is intended to remain in place for amaximumofthree years.That said,the Remuneration Committee will keep the Policy under review to ensure that it continues to remain appropriate.

Changes from 2015 Remuneration Policy

The main changes from the 2015 Remuneration Policy are summarised below:

• > Simplified incentive arrangements.The Long Term Bonus Performance Plan ("LTBPP"),whereby awards are granted every three years,with performance targets set annually and reviewed at the end of each financial year and at the end of the three year period, will be consolidated into the annual bonus arrangement albeit with significant deferral. Rather than enabling a grant of up to 675% of salary every three years (providing the average award level across the four Executive Directors does not exceed 450% of salary award every three years), it is proposed that going forward, subject to shareholder approval, the annual bonus will be capped at 150% of salary with:
• > 25% of salary continuing to be aligned to the workforce cash annual bonus (measured against store performance, through occupancy growth, store profitability, store audits and customer satisfaction scores); and
• > the remaining 125% of salary (measured against financial, operational, real estate and strategic targets) deferred into Big Yellow shares for three years, with vesting subject to continued employment.
• > Reduced pension provision. Reflecting the proposed base salary increases explained in the Annual Statement and Annual Report on Remuneration and the Investment Association's recent encouragementfor company pension provision to be aligned to that provided to the generalworkforce (as a percentage of salary), Executive Director pension provision will be reduced from 15% of salary (with a policy maximum of 20% of salary) to 10% of salary (being the pension provided for Big Yellow Department Heads).
• > Enhanced shareholder protection. In addition to the changes above, a two-year post vesting holding period will be introduced on future LTIP awards granted to Executive Directors following the 2018 AGM and withholding and recovery provisions (malus and clawback) will be added to the annual (and deferred) bonus plan and the existing provisions in the LTIP will be updated and enhanced where necessary.

To aid the administration and clarity of its operation, a number of minor changes have also been made to the wording of the Policy where appropriate.

Summary Policy table (Executive Directors)

The main components of the Directors' Remuneration Policy, and how they are linked to and support the Company's business strategy, which will take effect subject to approval from shareholders at the AGM on 19 July 2018, are summarised below:

Executive Directors

	Purpose and link to strategy	Operation	Maximum potential value	Performance conditions and assessment
Base salary	To provide competitive fixed remuneration that will attract and retain key employees and reflect their experience and position in the Company.	Base salary is normally set annually on 1 April. When considering any increases to base salaries in the normal course (as opposed to a change in role or responsibility), the Committee will take into consideration: > level of skill, experience, scope of responsibilities and performance; > business performance, economic climate and market conditions; > pay and employment conditions of employees throughout the Group, including increases provided to staff; and inflation; and > increases provided to Executive Directors in comparable companies (although such data would be used with caution).	Salaries are typically set after considering the salary levels in companies of a similar size and complexity in the FTSE 250. Our overall policy is normally to target salaries at close to median levels. Base salaries are intended to increase in line with inflation and general employee increases in salary. Higher increases may apply if there is a change in role, level of responsibility or experience or if the individual is new to the role. There is no maximum salary cap in place.	None
Annual bonus	The annual bonus aligns reward to key Group strategic objectives and drives short-term performance.	Executive Directors participate in an annual performance-related bonus scheme. Up to 25% of salary will be paid in cash. Up to 125% of salary will be deferred into shares for three years. Dividend equivalents may be payable on deferred share awards. The annual bonus plan rules contain clawback and malus provisions.	Bonus potential: 150% of salary.	Assessed annually and determined by the Committee based on financial, strategic and/or personal performance against the Group's business plan for each financial year.

Remuneration Report (continued)

Year ended 31 March 2018

Summary Policy table (Executive Directors)

	Purpose and link to strategy	Operation	Maximum potential value	Performance conditions and assessment
Long Term Incentive Plan	The Long Term Incentive Plan aligns Executive Director interests with those of shareholders and rewards value creation.	Awards are made annually to the Executive Directors (and certain senior managers who are in a position to influence significantly the performance of the Group)in the form of nil-paid options. The awards granted under the Long Term Incentive Plan are subject to performance conditions to be met over a performance period of three years. Dividend equivalents may be payable on LTIP awards during the vesting period, to the	Maximum annual grant is 100% of base salary, with normal awards of 100% of annual salary for the Executive Directors. Minimum vesting is 25% of salary assuming achievement of threshold performance, and the maximum vesting is 100% of salary.	Vesting under the LTIP is based on financial and share-price related performance measures.
		extent awards vest. The LTIP contains clawback and malus provisions.
		A two year post vesting holding period will be applied to any LTIP award granted to Executive Directors following the 2018 AGM.
Pension	To provide competitive levels of retirement benefit.	Contribution made into Executive Directors personal pension plan, or a cash supplement of equivalent value paid in lieu of pension contribution.	Maximum contribution of 10% of salary.	None
Other benefits	To provide competitive levels of employment benefits.	Benefits include: > Private fuel > Private medical insurance > Permanent health insurance > Life assurance of four times base salary > Relocation allowances (where relevant)	Maximum opportunity is the total cost of providing the benefits.There is no monetary cap on benefits.	None
		Other benefits may be provided where appropriate. The type and level of benefits provided is reviewed annually to ensure they remain market competitive.
Shareholding policy	To ensure that Executive Directors' interests are aligned with those of shareholders over a longer time horizon.	Requirement to build and maintain a holding of shares in the Company, through retaining at least 50% of shares vesting in discretionary share-based incentive plans if this guideline has not been met.	200% of salary.	N/A
All Employee Scheme	To encourage share ownership by all employees.This allows them to align their interests with those of investors and also to share in the long term success of the Company.	Executive Directors may participate in any HMRC tax favoured all employee arrangements.	In line with the prevailing HMRC limits.	None

Notes to the policy table

The key principle forthe short and long-term incentives is to provide a strong link between reward and individual and Group performance to align the interests of Executive Directors with those of shareholders.

1. Annual bonus performance measures and targets

Annual bonuses for the Executive Directors are based on:

• > 25% of salary cash bonus: the average of the stores' performance against their quarterly targets providing direct alignment of the Directors' bonuses to performance (and the bonus levels) of the staff.The four Key Performance Indicators used to assess store performance are occupancy growth, store profitability, store audits and customer satisfaction. Store targets are set every quarter and an average of the four quarters is taken.
• > 125% of salary deferred share bonus: measured against pre-set financial, operational, real estate and strategic targets.

2. Long Term Incentive Plan performance measures and targets

The Committee selected the performance conditions on the LTIP as they provide a direct link between the incentive for the Executive Directors and the value created for shareholders.The two metrics for the outstanding and proposed 2018 awards are:

• > Relative TSR against the FTSE Real Estate Index, as Big Yellow's historic performance has been closely aligned to the performance of this Index; and
• > The adjusted EPS figure is as reported in the audited results ofthe Group forthe last complete financial year ending before the start ofthe performance period and the last complete financial year ending before the end of the performance period.

3. Malus and clawback

The annual bonus, deferred bonus plan and LTIP include malus and clawback provisions.

Malus is the adjustment of outstanding deferred bonus and LTIPawards as a result ofthe occurrence of one ormore circumstances listed below.The adjustment may resultin the value being reduced to zero.Malus will apply for the three year period from grantto vesting for the deferred bonus and LTIP awards.

Clawback is the recovery of payments/vestings under the cash bonus and LTIP as a result of the occurrence of one or more circumstances listed below. Clawback will apply for three years post payment of a cash bonus/grant of deferred share awards and three years post vesting for LTIP awards.

The circumstances in which malus and clawback could apply are as follows:

• > discovery of a material misstatement resulting in an adjustment in the audited consolidated accounts of the Company;
• > the assessment of any performance target or condition in respect of an award was based on error, or inaccurate or misleading information;
• > the discovery that any information used to determine the amount of an award was based on error, or inaccurate or misleading information;
• > action or conduct of an award holder which, in the reasonable opinion of the Board, amounts to fraud or gross misconduct; and
• > events or behaviour which have led to the censure of the Company by a regulatory authority or have had a significant detrimental impact on the reputation of any Group Company.

4. Discretion

The Committee has discretion in several areas of policy as set out in this report. The Committee may also exercise operational and administrative discretions under relevant plan rules approved by shareholders as set out in those rules. In addition, the Committee has the discretion to amend policy with regard to minor or administrative matterswhere itwould be, in the opinion ofthe Committee, disproportionate to seek or await shareholder approval.

In certain circumstances,the Committeewill be required to exercise its discretion,taking into consideration the particular circumstances of an Executive Director's departure and/or the recent performance of the Company in determining the specific level of payments to be made.

In addition to the discretions underthe terms ofthe annual bonus plan (both cash and deferred shares) and LTIP,the Committee has discretion to determine whether an individual is classified as a "good leaver".

It should be noted that it is the Committee's policy to only apply its discretion if the circumstances at the time are, in its opinion, sufficiently exceptional, and to provide a full explanationto shareholderswherediscretionis exercised.TheCommitteedoesnot currentlyintendto amendorwaive anyperformance conditions.

5. Differences in remuneration policy for all employees

All employees are currently entitled to base salary, benefits, pensions and the Sharesave Scheme. Additionally, all employees are eligible for annual bonuses with the maximum opportunity available based on the seniority and responsibility of the role held.

The Company's LTIPs are granted to a number of senior managers within Head Office, the area manager team and also to store managers.

Remuneration Report (continued)

Year ended 31 March 2018

Illustrations of application of Remuneration Policy

The graphs below seek to demonstrate how pay varies with performance for the Executive Directors based on the proposed Remuneration Policy, which is subject to shareholder approval.

The assumptions used in determining the level of pay out under given scenarios are as follows:

Scenario	Description
Fixed Pay		Chief Executive	Executive Chairman	Chief Financial Officer	Operations Director
	Base salary (1 April 2018)	£350,000	£315,000	£260,000	£250,000
	Estimated Benefits	£6,000	£5,000	£2,000	£5,000
	Pension 10% 10% 10% 10% (% of salary)
On-target		50% of annual bonus award being paid and 50% vesting of the LTIP.
Maximum		100% of annual bonus award being paid (i.e. 150% of salary) and 100% vesting of the LTIP.

Summary Policy table (Non-Executive Directors)

	Objective and link to the strategy	Operation	Maximum potential value	Performance conditions and assessment
Fees	To attract Non Executive Directors	Fee levels are normally reviewed annually in March.	Fee levels are normally set at broadly median levels for comparable roles at	N/A
	with the requisite skills and	The Non-Executive Director fee structure is a matter for the full Board.	companies of a similar size and complexity within the FTSE 250.
	experience	Non-Executive Directors may be entitled to benefits relating to travel and office support and such other benefits as may be considered appropriate.	Fees are normally intended to increase in line with inflation.
		The fees may be paid in the form of shares.

Non-ExecutiveDirectors'fees comprises of a base fee,with an additional£5,000for a Committee Chairman and forthe SeniorIndependentNon-ExecutiveDirector.

Approach to recruitment remuneration

The table below summarises our key policies with respect to recruitment remuneration:

Salary and	>	Set by reference to market and taking into account individual experience and expertise in the context of the role.
benefits	>	Salary would also be set with reference to the salary of any departing Executive Director and the remaining Executive Directors.
	>	The Executive Director would be eligible to receive benefits in line with Big Yellow Group's benefits policy as set out in the
		remuneration policy table – this includes either a contribution to a personal pension scheme or cash allowance in lieu of pension
		benefits in line with the policies set out in the policy table.
Maximum variable	>	Annual bonus of up to 150% of base salary.
incentive	>	Long term incentive plan award of equivalent to 100% of base salary.
Sign-on payments	>	The Company does not provide sign-on payments to Executive Directors.
Share buy-outs	>	Any previous outstanding share awards which the Executive Director holds which would be forfeited on cessation of his or her
		previous employment may be compensated.
	>	Where this is the case,the general principle is thatthe outstanding awardwill be valued based on the consideration ofthe following
		factors:
		> The proportion of the performance period completed on the date of the Director's cessation of employment;
		> The performance conditions attached to the vesting of the incentives and the likelihood of them being satisfied; and
		> Any other terms and conditions having a material impact on their value.
	>	The valuation will be conducted using a recognised valuation methodology by an independent party and the equivalent 'fair value'
		may be awarded as a one-off LTIP on date of joining under the Company's existing long term incentive plan.To the extent that this
		is not possible, a bespoke arrangement will be used.
	>	To ensure effective retention of the Executive Director upon recruitment, any new award will be granted subject to performance
		conditions and vesting may be over the same period as those forfeited from the previous employer or a new three year period.
	>	The exacttermswill be determined by the Remuneration Committee on a case-by-case basis taking into account allrelevantfactors.
Relocation policies >		In instances where the new Executive Director is relocating from one work location to another, the Company may provide, as a one
		off or otherwise, a relocation allowance as part of the Director's relocation benefits.
	>	The level of the relocation package will be assessed on a case-by-case basis but will take into consideration any cost of living
		differences, housing allowance and schooling.

Service contracts

The Company's policy on Directors' service contracts is that they should be on a rolling basis without a specific end-date providing for one year's notice. All Executive Directors have contracts which reflect this policy.

The Non-Executive Directors do not have service contracts with the Company.Their appointments are governed by letters of appointment which are available for inspection on request atthe Company's registered office andwhichwill be available for inspection atthe Company's AGM. Each appointmentis for a period of up to three years, although the continued appointment of all Directors is put to shareholders at the AGMon an annual basis. In addition, the appointment is terminable by either party giving notice of three months.

Remuneration Report (continued)

Year ended 31 March 2018

Payments for loss of office

Element	Approach
Salary and benefits	Salary and benefitsmay be paid in lieu of notice. In caseswhere a contractis terminated otherthan on the terms ofthe service contract, the Company will seek to mitigate any damages payable.
	There will be no compensation for normal resignation or in the event of termination by the Company due to misconduct.
Annual bonus	If the individual is a good leaver, bonus will be paid on a pro-rata basis in respect of the period from the start of the financial year. Any pro-rated bonus would normally be payable in cash (i.e. no award of deferred shares would be made).
	Deferred share awards would normally vest at the normal vesting date (although may vest at the date of cessation).
	Good leaver is defined as an individual ceasing employment as a result of ill-health, disability, redundancy or retirement or in any other circumstances which the Committee permits.
	A bad leaver is an Executive Director who does not fall within the category of "good leaver" and bad leavers will forfeit any entitlement to a bonus payment in respect of the current financial year or any completed financial year in respect of which the bonus has not been paid at the cessation date.
Long term incentives (LTIP)	A proportion of the LTIP awards held by good leavers will vest at the Committee's discretion determined by taking into account whether, and to what extent, any performance conditions have been satisfied and the length of time the LTIP award has been held at the date of cessation of employment.
	The LTIP awards will not normally vest until the end of the performance period with performance tested at that time, although exceptionally such awards may, at the discretion of the Committee, vest at cessation of employment.
	Good leaver is defined as an individual ceasing employment as a result of ill-health, injury, disability, redundancy, retirement, or the sale out of the Group of his employing business for any other reason which the Committee in its absolute discretion permits.
	A bad leaveris an Executive Directorwho does notfallwithin the category of good leaver and bad leaverswill forfeit any unvested awards.
Other	The Group may meet relocation and other incidental expenses on termination of employment, the fees of legal or other professional advisers, outplacement, compensation in respect of statutory rights underrelevant employment protection legislation and accrued but untaken holiday. It may also elect to continue to provide certain benefits rather than making payment in lieu of the benefit in question.

Statement of consideration of shareholders' views

The views of our shareholders are very important to the Committee and we have actively consulted with our major shareholders and the main representative bodies to help formulate our amended Remuneration Policy and arrangements proposed in this report.

Any consultations on remuneration with shareholders and representative bodies will usually be led by the Chair of the Remuneration Committee.

The Remuneration Committee considers shareholder feedback received in relation to the AGM each year at its first meeting following the AGM.This feedback, as well as any additional feedback received during any other meetings with shareholders throughout the year, is then considered as part of the Company's annual review of remuneration policy.

The Remuneration Committee notes that shareholders do not speakwith a single voice, butwe engagewith ourlargest shareholders to ensurewe understand the range of views which exist on remuneration issues. When any material changes are proposed to the Remuneration Policy, the Remuneration Committee Chair will inform major shareholders in advance, and will offer a meeting to discuss these.

Shareholder voting

The Group is committed to ongoing shareholder dialogue and takes an active interestin voting outcomes.Where there are substantial votes againstresolutions in relation to Directors'remuneration,the reasons forthat votingwill be sought and any actions in responsewill be detailed here.There have been no significant issues raised by shareholders in respect of remuneration in the year.

The table below shows the advisory vote on the 2017 Remuneration Report and the binding vote on the Remuneration Policy at the AGM held on 21 July 2015.

	Votes for	%	Votes Against	%	Votes withheld
2017 Remuneration Report	120,565,327	99.17	1,006,046	0.83	3,811,797
2015 Remuneration Policy	124,032,466	99.22	979,331	0.78	177,620

ANNUAL REPORT ON REMUNERATION

This section of the Remuneration Report contains details of how the Directors' Remuneration Policy will, subject to shareholder approval, be implemented for the year ending 31 March 2019 and how it was implemented during the year ended 31 March 2018.

Implementing the Policy for the Year Ending 31 March 2019

Base salary

While the Committee has operated a policy oftargeting base salaries "close to (but generally just below) median" for some time, actual salaries have been set significantly below median levels.

Following a reviewof Executive Director base salary levels as part ofthe Remuneration Policy review,the Remuneration Committee has concluded that current salary levels are no longerreflective of each individual's role and responsibilities in a FTSE 250 company of Big Yellow's size and complexity given the increase in (i)the numbers of stores;(ii)the geographical spread;(iii)the employee base;(iv) customers;(v)revenue; and (vi) profits.

As such, and in connection with the simplification and de-gearing of incentive potential as part of the Remuneration Policy review, the following base salary increases are proposed:

	Chief Executive (James Gibson)	Executive Chairman (Nicholas Vetch)	Chief Financial Officer (John Trotman)	Operations Director (Adrian Lee)
Current	£302,000	£275,200	£223,700	£223,700
From 1 April 2018	£350,000	£315,000	£260,000	£250,000
From 1 April 2019	£400,000	£350,000	£300,000	£270,000
From 1 April 2020	£440,000	£375,000	£325,000	£285,000

The Committee considers the proposed base salary levels to be more appropriate in light of each individual's role and contribution to Big Yellowand Big Yellow's size and complexity (although they remain conservatively positioned against the sector and market more generally). Further, in addition to his Executive Chairman role, it should also be noted that Nicholas Vetch has also taken on executive responsibility for the property team in the past year, covering both property acquisitions and development.

The proposed salary increases are neither post freeze catch-up awards, nor are they benchmarking driven and while the Committee had originally intended to increase salary levels from 1 April 2018 and 1 April 2019, the Committee has decided to phase the salary increases over three years following consultation with investors.

Further, in line with best practice, the increases from 1 April 2019 and 1 April 2020 are not guaranteed but will be subject to satisfactory Group and individual performance during the years ending 31 March 2019 and 31 March 2020. Other than for a material role change, subsequent salary increases are expected to be in line with the general workforce increases.

Benefits

No changes will be made to benefit provision (private fuel, private medical insurance, permanent health insurance, life assurance and relocation allowances, where relevant).

Annual bonus

Annual bonus potential will be capped at 150% of salary for the year ending 31 March 2019.

Up to25% of salarywill continue to be aligned to theworkforce annual bonus (measured against store performance,through occupancy growth, store profitability, store audits and customer satisfaction scores). Any bonus earned underthis part will be payable in cash, following the year ending 31March 2019.

The remaining 125% of salary will be measured against financial, operational, real estate and strategic targets measured over the financial year ending 31 March 2019. Any award under this part will be deferred into Big Yellow shares for three years (with vesting subject to continued employment).

Pension

Reflecting the proposed base salary increases and the Investment Association's recent encouragement for company pension provision to be aligned to that provided to the general workforce (as a percentage of salary), Executive Director pension provision was reduced from 15% of salary to 10% of salary (being the pension provided for the Company's Department Heads)from 1 April 2018.

Remuneration Report (continued)

Year ended 31 March 2018

LTIP

LTIP awards will continue to be granted to Executive Directors annually, over shares equal to 100% of salary.The performance conditions for awards intended to be granted to Executive Directors in 2018 are as follows:

• > 70% adjusted EPS adjusted EPS growth of RPI+3% p.a. for 25% of this element of the award to vest with full vesting occurring for adjusted EPS growth of RPI+8% p.a.;
• > 30% relative TSR performance vs. FTSE Real Estate Index with 25% of this element of the award vesting for median TSR comparative performance and full vesting at upper quartile.

Subject to the new Remuneration Policy receiving shareholder approval, a two year post vesting holding period will be applied to any LTIP award granted to Executive Directors following the 2018 AGM.

Shareholding Guidelines

The requirement to build and maintain a holding of at least 200% of salary in shares of the Company, through retaining at least 50% of shares vesting in discretionary share-based incentive plans if this guideline has not been met, will continue to apply.

Non-Executive Directors

Non-Executive Director fees for the year ending 31 March 2019, together with the fees for the year ended 31 March 2018, are as follows:

Non-Executive	2018/19 fee	2017/18 fee
Richard Cotton	£45,100	£44,200
Tim Clark	£45,100	£44,200
Georgina Harvey	£45,100	£44,200
Steve Johnson	£40,000	£39,200
Anna Keay	£40,000	£39,200 1
Vince Niblett	£45,100	£44,200 1

¹ Annual fee from appointment.

How the Policy Was Implemented for the Year Ended 31 March 2018

Single total figure of remuneration (Audited)

The table below sets out the single total figure of remuneration and breakdown for each Executive Director paid in the year ended 31 March 2018.

	Salary £			Taxable benefits1 £	Annual bonus £		Pensions2 Long term incentives £ £		Total £
	2018	2017	2018	2017	2018	2017	2018	2017	2018	2017	2018	2017
Nicholas Vetch	275,200	269,800	5,120	5,313	35,501		26,980 1,328,117	433,011	41,280		40,470 1,685,218	775,574
James Gibson	302,000	296,000	5,120	5,713	38,958		29,600 1,786,688	474,914	45,300		44,400 2,178,066	850,627
Adrian Lee	223,700	219,300	4,313	4,806	28,857		21,930 1,253,430	329,102	33,555		32,895 1,543,855	608,033
John Trotman	223,700	219,300	1,806	2,061	28,857		21,930 1,250,216	329,102	33,555		32,895 1,538,134	605,288
Total		1,024,600 1,004,400	16,359	17,893	132,173			100,440 5,618,451 1,566,129	153,690		150,660 6,945,273 2,839,522

¹ Taxable benefits comprise medical cover, permanent health insurance, life insurance and private fuel usage.

² Nicholas Vetch and James Gibson receive a cash supplement in lieu of their full pension contributions. Adrian Lee and John Trotman receive cash supplements in lieu of pension contributions above £10,000.

The values shown in long term incentives in the current year are as follows:

• > the LTIP award granted in 2014 which vested on 29 July 2017 to 100% of its maximum value and is valued using the share price on that date of 787p. The award granted for 2018 is 100% of salary for each Executive Director;
• > the Long Term Bonus Performance Plan, which vested to 93.33% of its maximum value.The award is exercisable from July 2018; and
• > for James Gibson and John Trotman, Sharesave awards which matured in the financial year.

The average salary increase across the Group in the year was 2%; this increase was also applied to the Executive Directors from 1 April 2017.

Annual Bonus Plan awards

The policy of the Company is that the cash bonus paid to the Executive Directors is the same as the average of the bonus awards (as a % of salary) paid to all the Group's stores on achieving their targets during the course of the year. It is an important part of the Group's culture that the Executive team are rewarded with the same level of annual bonus as the average for all staff.

In respect of the year under review, and in line with the average bonus as a percentage of salary paid across the stores the Executive Directors' received a cash bonus of 12.9% of salary (out of a maximum of 25% of salary).

Overview of the staff (and Executive Director) cash bonus scheme

The staff bonus scheme is designed, on a quarterly basis, to reward each store with a bonus of up to 25% of their quarterly salary, made up of the following four key elements set out below:

Occupancy performance against target

Each store is set a quarterly target for occupancy growth.The weighting of the contribution of these metrics to the bonus varies based on store occupancy, with higher occupied stores having a lower weighting towards their performance against their occupancy target.

The bonus awarded to each store increases as the store moves further ahead of target. No bonus is awarded if the store fails to meet its target.The individual store targets have not been disclosed as it would be impractical and commercially sensitive to disclose the targets for every one of our stores in this report.

However following feedback received from our shareholders on previous remuneration reports to increase the disclosure around the annual bonus, we have shown the average annual distribution of performance against target for each of the bonus measures across our stores and the corresponding average payout as a percentage of salary which directly corresponds to the bonus percentage pay-out for the Executive Directors.

The average performance against the four key targets and the associated reward for the stores were as follows:

1 Occupancy

Performance against target	Below target	0 to 10% ahead of target	10 to 20% ahead of target	20 to 30% ahead of target	30 to 40% ahead of target	> 40% ahead of target	Total
No of stores	37	1	4	3	2	26	73
Average bonus paid	0%	0.8%	2.1%	4.2%	9.0%	12.8%	5.2%

Additionally, twelve stores were awarded bonuses for averaging 85% occupancy and above earning a total weighted average bonus of 0.7%. The weighted average bonus paid to stores for performance against occupancy targets is therefore 5.9% of salary for the year.

2 Profitability

Each store is set a quarterly target for profitability. The weighting of the contribution of these metrics to the bonus varies based on store occupancy, with higher occupied stores having a higher weighting towards their performance against their profitability target.

The bonus awarded to each store increases as the storemoves further ahead oftarget. No bonus is awarded ifthe store fails tomeetits target.The performance distribution of the store's performance against their individual targets are provided below.

Performance against target	Below target	0 to 1% ahead of target	1 to 2% ahead of target	2 to 3% ahead of target	>3% ahead of target	Total
No of stores	29	12	13	9	10	73
Average bonus paid	0.1%	1.3%	3.6%	4.4%	7.7%	2.5 %

The weighted average bonus paid to stores for performance against profitability targets is therefore 2.5% of salary for the year.

3 Store audits

Stores receive a bonus if they receive an audit score of in excess of 85% based on visits carried out by the Group's store compliance team. There were 51 instances of stores receiving an audit score of 85% and above across the year, leading to a weighted average bonus paid to the stores of 1.4% of salary.

Remuneration Report (continued)

Year ended 31 March 2018

Annual Bonus Plan awards (continued)

4 Customer satisfaction

Stores are rewarded based on two elements of customer satisfaction, net promoter scores and individual customer service awards.The awards based on net promoter scores are summarised in the table below.

NPS score	<75	>75	Total
No of stores	22	51	73
Average bonus paid	0%	1.9%	1.4%

The weighted average bonus paid to stores for performance against net promoter scores is therefore 1.4% of salary for the year.

The bonus paid to stores forindividual customer service awards amounted to a further 1.7% of salary,which, combinedwith the net promoter score, amounted to a weighted average bonus paid to the stores for customer satisfaction of 3.1% of salary.

Summary

The bonus received by the stores against their targets in the year is summarised as follows.

Category	Actual % weighting for category	Average % of salary bonus paid across stores
1. Occupancy	46%	5.9%
2. Profitability	19%	2.5%
3. Store audits	11%	1.4%
4. Customer satisfaction	24%	3.1%
Total	100%	12.9%

In line with the Remuneration Policy an award at this level has therefore also been paid to the Executive Directors for the year.

The performance in the year resulted in a bonus of 12.9% of salary, which equated to the following payments for the Executive Directors:

• > Nicholas Vetch £35,501
• > James Gibson £38,958
• > Adrian Lee £28,857
• > John Trotman £28,857

Long Term Incentive Plan ("LTIP") awards (Audited)

The awards granted under the LTIP are subject to performance conditions to be met over a performance period of three years. There is no retesting of performance conditions and, if they are not satisfied, the awards will lapse.

The performance conditions applicable to the LTIP which vested in the year, which relate to EPS and TSR, are set out below.

Vesting is conditional on the achievement of EPS growth of an average of 3% above RPI per annum. This hurdle was met for the 2014 awards, with average annual growth in EPS of 23%, compared to RPI plus 3% of 5% per annum.

The Committee assessed the extent to which the EPS and TSR performance condition has been satisfied for the 2014 award which vested in 2017, with the following results:

Condition	Weighting	Threshold performance required	Maximum performance required	LTIP value for meeting threshold and maximum performance (% salary)	Performance achieved	Vesting %
Relative TSR	100%	Median of comparator group of real estate companies	Upper quartile of the comparator group	25% – 100%	7 out of 31 in comparator group of companies in the FTSE Real Estate Index	100%
Total	100%					100%

The full vesting of the 2014 LTIP award in 2017, equated to the following value for the Executive Directors based on the share price at the date of vesting:

• > Nicholas Vetch £397,680 (50,467 shares)
• > James Gibson £431,674 (55,352 shares)
• > Adrian Lee £322,993 (40,989 shares)
• > John Trotman £306,737 (38,926 shares)

LTIP awards granted in year ended 31 March 2018 (Audited)

The table below sets out the details of the long term incentive awards granted in 2017 in the year ended 31 March 2018 where vesting will be determined according to the achievement of performance conditions that will be tested in future.

Director	Award type	Awards as a % of salary	Face value of award1	Percentage of award vesting at threshold performance	Maximum percentage of face value that could vest	Performance period end date	Performance conditions
Nicholas Vetch			£275,200
James Gibson	Annual cycle of		£302,000				Adjusted EPS
Adrian Lee	awards over nil cost options	100% of salary	£223,700	25%	100%	3 August 2020	growth and relative TSR
John Trotman			£223,700

¹ The face value of the award is calculated using the average share price three days prior to the grant date of 3 August 2017 (average share price of 773.3 pence).

The performance conditions applicable to the awards granted in 2017 are set out below.There are no changes to the performance measures, their weightings and the targets from the awards granted in 2016:

Condition	Weighting	Threshold performance required	Maximum performance required	LTIP value for meeting threshold and maximum performance (% salary)	Basis for measurement
Relative TSR	30%	Median of comparator group of real estate companies	Upper quartile of the comparator group	25% to 100%	The average ofthe Group's closingmid market share price overthe threemonths preceding the start ofthe performance period and preceding the end ofthe performance periodwill be used, including dividends re-invested.
Adjusted EPS	70%	Adjusted EPS growth of RPI+3% per annum	Adjusted EPS growth of RPI+8% per annum	25% to 100%	The adjusted EPS figure reported in the audited results ofthe Group forthe last complete financial year ending before the start ofthe performance period and the last complete financial year ending before the end ofthe performance periodwill be used.
Total	100%

Between threshold and maximum performance, vesting will take place on a straight-line basis.

Long Term Bonus Performance Plan (Audited)

The only outstanding LTBPP awards are those granted in 2015 which are due to vest in 2018:

Director	Award type	Awards as a % of salary at the time of grant	Face value of award	Percentage of award vesting at threshold performance	Maximum percentage of face value that could vest	Performance period end date	Performance conditions
Nicholas Vetch	Granted every three years,	377%	£996,900				Assessed
James Gibson	award converts	496%	£1,440,000				annually on
Adrian Lee	to nil cost	464%	£996,900	0%	100%	31 March 2018	a basket of
John Trotman	options on vesting.	464%	£996,900				measures

Remuneration Report (continued)

Year ended 31 March 2018

Long Term Bonus Performance Plan (Audited) (continued)

The report on the targets for the year ended 31 March 2018 (other than those which remain commercially sensitive)is summarised in the table below:

Objective	Committee Comment
Grow the Group's annual operating cash flow by £4 million for the year to 31 March 2018 compared to the year to 31 March 2017.	The Group's annual operating cash flowgrewby £7.0million in the yearto 31March 2018.
Increase the Group's occupied space by 175,000 sq ftin the year ending 31March 2018 compared to a net growth of 112,000 sq ftin the prior year.	Overall occupied space increased by 179,000 sq ftin the year.
Growthe occupancy ofthe like-for-like stores open at 31March 2017 to 81.7% by 30 September 2017, and following the seasonal occupancy loss in the third quarter,recoverto this level by 31March 2018, compared to an increase of 2.8 ppts last year.	Occupancy ofthe like-for-like stores increased to 83.8% by 30 September 2017, ayearonyearincreaseof5.3ppts.Thethirdquarter sawa slightlylarger seasonal occupancyloss thantheprioryear,duetothestrongsummer's trading,but after a returntogrowthinQ4,theclosingoccupancywas81.9%, ayearonyearincrease of3.9ppts.
Growtheaveragenetrentpersquarefootacrossthestoresfrom£26.03persquare footby1.5%to£26.43by31March2018,comparedtogrowthof0.5%in2017.	Theaveragenetrentacrosstheportfolioat31March2018was£26.74,anincrease of2.7%from1April2017.
Meet budgeted revenue (£114.6 million) and adjusted profit before tax (£59.2 million)targets.	Revenue for the year was £116.7 million, 2% ahead of budget. Adjusted profit before tax was £61.4 million, 4% ahead of budget.
Meet or exceed the budgeted adjusted earnings per share of 37.2 pence.	Adjusted earnings per share were 38.5 pence for the year, 3% ahead of the budgeted amount.
Review potential sites (in London and key target towns outside of London) for store acquisition with a view of acquiring at least one new site in the year.	TheGrouphasacquiredfivedevelopmentsitessince1April2017inWapping (London),Uxbridge(London),Hove,BracknellandSlough,increasingthe developmentpipelineto10sites(includingoneextensionsite).
	TheGroupcontinuestomonitorotheropportunities.
Maintain the Group's online market share measured against the top 35 self storage operators by Connexity Hitwise, at on average greater than 30%.	The Group's online market share for the year as measured by Connexity Hitwise was 31%.
The planning application for Camberwell has been rejected on design grounds. We have submitted an appeal byway of an informal hearing ratherthan a full public inquiry.The objective is to have a planning consent byMarch 2018.	Planning consent has nowbeen granted forthe development of a 72,000 sq ft stores at Camberwell.We are nowstarting detailed designwork.
Obtain planning consent for Manchester.	Planning consent was granted in September 2017 for a 60,000 sq ft store. We have started constructionwith a viewto a store in opening in spring 2019.
Maintain the net promoter score for customer satisfaction from the Customer Experience programme in excess of 70 for move ins and 65 for move out surveys.	The move in NPS score for the year was 86, an increase from 83 in the prior year.The move out NPS score for the year was 70, an increase from 67 in the prior year.
Maintain the Group's brand leadership of unprompted and prompted awareness throughoutthe UK,to bemeasured by third party survey in the year.	The YouGov survey commissioned in April 2018 has shown our prompted awareness to be at 71% in London, over two and half times higher than our nearest competitor and 46% for the rest of the UK, over three times higher than our nearest competitor.
	For unprompted brand awareness, our recall in London is 46%, six and a half times higher than our nearest competitor and for the rest of the UK it is 23%, nearly eight times higher than our nearest competitor.
Reduce the carbon intensity for the year to 31 March 2018 (KgCO2/m2 of occupied space) by 5% from the year to 31 March 2017.	Carbon intensity was reduced by 20% for the year to 31 March 2018.

Long Term Bonus Performance Plan (Audited) (continued)

The other targets, covering areas such as real estate, staffing and certain financial targets, were met in the majority of cases.They have not been disclosed as they are commercially sensitive.

Following careful consideration of the performance targets and actual performance of the Group and the Executive Directors, the Committee has concluded that the award in respect of the financial year ended 31 March 2018 has vested at 100% of its potential amount for the year. For the years ended 31 March 2016 and 31 March 2017, the Committee concluded that the award had provisionally vested as to 90% of its potential amount for each year.

The Committee has also then assessed the vesting for the three years of the plan and has determined an overall vesting of 93.33% for the whole period of the plan. In reaching this determination, the Committee took into account the fact that, over the three years of the plan, substantially all of the annual targets set at the outset of each year (by reference to the relevant business plan) had been met as well as the significant progress which has been made by the Group over the past three years. By way of illustration, over the past three years, the Group's revenue has increased by 38%, with adjusted EPS increasing by 42% and dividends declared increasing by 42%. The Committee believes that this level of vesting is therefore consistent with the Group's performance and the shareholder experience and, as such awards under the plan will formally vest in July 2018. Once vested, part of the award will then be subject to a holding period in line with the current Remuneration Policy.

Sharesave Scheme

The Group's Sharesave Scheme is open to all UK employees (including Executive Directors) with a minimum of six months' service and meets UK HMRC requirements, thus giving all eligible employees the opportunity to acquire shares in the Company in a tax efficient manner.Three of the Executive Directors participated in the scheme during the financial year.The details of the Sharesave scheme options are shown on page 83.

Pension entitlements

The Company pays pension contributions into the Executive Directors' personal pension plans or makes a cash contribution in lieu of pension contributions. They do not participate in any defined benefit scheme. For the year ended 31 March 2018, the Company contribution was 15% of salary for the Executive Directors.

Payments to past Directors (Audited)

No payments of money or any other assetswere made to any former Director ofthe Company in the financial year ended 31March 2018 (2017: no payments).

Payments on loss of office (Audited)

No payments were made to any Directors in respect of loss of office during the financial year ended 31 March 2018 (2017: no payments).

Non-Executive Directors (Audited)

The table below sets out the single total figure of remuneration and breakdown for each Non-Executive Director paid in the year ended 31 March 2018:

	2018	2017
Tim Clark	44,200	43,700
Richard Cotton	44,200	41,000
Georgina Harvey	44,200	38,400
Steve Johnson	39,200	38,400
Anna Keay	3,2671	–
Vince Niblett	36,8332	–
Mark Richardson	13,4423	41,000
Total	225,342	202,500

¹ From appointment on 1 March 2018

² From appointment on 1 June 2017

³ Until retirement on 20 July 2017

Forthe year ended 31March 2018,the Company reviewed the Non-Executive Director base fee and decided to adjustitto £39,200 from£38,400 (2% increase) and to harmonise the fees provided for Committee Chairs and the SeniorIndependent Directorto £44,200. Non-Executive Directors received no taxable benefits for the year ended 31 March 2018.

Remuneration Report (continued)

Year ended 31 March 2018

Fees retained for external non-executive directorships

The Executive Directors' contracts do not allow them to engage in any other business outside the Group except where prior written consent from the Board is received. The Company recognises that Executive Directors may be invited to become Non-Executive Directors of other companies and that this can help broaden the skills and experience of a Director. Executive Directors are normally permitted to accept external appointments with the approval of the Board and may retain the fees for the appointment.

Nicholas Vetch is a Non-Executive Director ofThe Local Shopping REIT plc for which he receives a fee of £30,000 per annum. James Gibson is a Non-Executive Director of AnyJunk Limited and of Moby Self Storage in Brazil; he does not receive any fees for his services.

Statement of Directors' shareholding (Audited)

The Executive Directors are required to build and maintain a holding of two times base salary.These requirements have been met by all Executive Directors throughout the year. Non-Executive Directors are not subject to a shareholding requirement. Details of the Directors' interests in shares are set out below (all interests are beneficial interests).

No changes took place in the interests of the Directors in the shares of the Company between 31 March 2018 and the date of this report.

The table below shows, in relation to each Director, the total number of shares and share options in which they have an interest. LTBPP awards are not shown in the table below as the number of shares awarded is calculated by reference to the total vested award value divided by the Company's share price at the vesting date.

Director	Share ownership requirement (multiple of salary)	Share ownership requirements met	Holding as multiple of March 2018 salary	Beneficially owned shares	LTIP awards subject to performance conditions	Unexercised Sharesave options	Options exercised in the financial year
Nicholas Vetch	2x	Yes	279x	8,988,366	111,120	–	50,467
James Gibson	2x	Yes	70x	2,465,309	121,908	2,812	57,171
Adrian Lee	2x	Yes	33x	854,643	90,324	2,960	40,989
John Trotman	2x	Yes	7x	179,788	90,324	2,665	42,565

Non-Executive Directors' shareholdings (Audited)

Non-Executive	Beneficially owned shares
Richard Cotton	88,485
Tim Clark	20,615
Georgina Harvey	15,293
Steve Johnson	10,000
Vince Niblett	3,000
Anna Keay	–

Directors' share awards (Audited)

To provide further context on the shareholding ofthe Executive Directors, options in respect of ordinary shares for Directorswho served in the year are as below:

Name Nicholas Vetch	Date option granted 29 July 2014	Scheme LTIP	No. of shares under option at 2017 50,467	Granted 31 March during the year –	Exercised during the year (50,467)	Lapsed during the year –	No. of shares under option at 31 March 2018 –	Exercise price nil p	Market price at date of exercise 748.5p	Date from which first exercisable 29 July 2017	Expiry Date 28 July 2024
	21 July 2015	LTIP	38,112	–	–	–	38,112	nil p	–	21 July 2018	20 July 2025
	22 July 2016	LTIP	37,420		–	–	37,420	nil p	–	22 July 2019	21 July 2026
	3 August 2017	LTIP	–	35,588	–	–	35,588	nil p	–	3 August 2020	2 August 2027
James Gibson	29 July 2014	LTIP	55,352	–	(55,352)	–	–	nil p	775.1p	29 July 2017	28 July 2024
	16 March 2015	SAYE	1,819	–	(1,819)	–	–	494.6p	853.0p		31 March 2018 1 October 2018
	21 July 2015	LTIP	41,801	–	–	–	41,801	nil p	–	21 July 2018	20 July 2025
	14 March 2016	SAYE	1,480	–	–	–	1,480	608.0p	–		31 March 2019 1 October 2019
	22 July 2016	LTIP	41,054		–	–	41,054	nil p	–	22 July 2019	21 July 2026
	3 August 2017	LTIP	–	39,053	–	–	39,053	nil p	–	3 August 2020	2 August 2027
	12 March 2018	SAYE	–	1,332	–	–	1,332	675.4p	–		31 March 2021 1 October 2021
Adrian Lee	29 July 2014	LTIP	40,989	–	(40,989)	–	–	nil p	775.1p	29 July 2017	28 July 2024
	21 July 2015	LTIP	30,980	–	–	–	30.980	nil p	–	21 July 2018	20 July 2025
	14 March 2016	SAYE	2,960	–	–	–	2,960	608.0p	–		31 March 2019 1 October 2019
	22 July 2016	LTIP	30,416	–	–	–	30,416	nil p	–	22 July 2019	21 July 2026
	3 August 2017	LTIP	–	28,928	–	–	28,928	nil p	–	3 August 2020	2 August 2027
John Trotman	29 July 2014	LTIP	38,926	–	(38,926)	–	–	nil p	775.1p	29 July 2017	28 July 2024
	16 March 2015	SAYE	3,639	–	(3,639)	–	–	494.6p	853.0p		31 March 2018 1 October 2018
	21 July 2015	LTIP	30,980	–	–	–	30,980	nil p	–	21 July 2018	20 July 2025
	22 July 2016	LTIP	30,416	–	–	–	30,416	nil p	–	22 July 2019	21 July 2026
	3 August 2017	LTIP	–	28,928	–	–	28,928	nil p	–	3 August 2020	2 August 2027
	12 March 2018	SAYE	–	2,665	–	–	2,665	675.4p	–		31 March 2021 1 October 2021

A proportion of the LTIP awards that were exercised in the year by the four Executive Directors were delivered through CSOP approved options. Each Executive Director exercised an option over 5,838 approved shares.The value delivered through these approved options was surrendered in the unapproved LTIPs above.

Performance and pay

The graph belowshows the Group's performance,measured by TSR, comparedwith the performance ofthe FTSE All Share Real Estate Index and the FTSE All Share Index for the period since flotation.The FTSE All Share Real Estate Index is used for the assessment of the Company's LTIP.

Remuneration Report (continued)

Year ended 31 March 2018

CEO Remuneration

The table below sets out the details of remuneration of the CEO over the past nine financial years.

Year	CEO single figure of total remuneration (£)	Annual bonus pay out % against maximum of 25% of salary	Long term incentive weighted average vesting rates against maximum opportunity %
2018	2,178,066	51.6% (12.9% of salary)	95%
2017	850,619	40% (10% of salary)	100%
2016	988,811	48% (12% of salary)	100%
2015	1,756,290	50% (12.5% of salary)	98%
2014	536,262	40% (10% of salary)	53%
2013	335,891	40% (10% of salary)	0%
2012	1,400,570	40% (10% of salary)	89%
2011	325,968	40% (10% of salary)	0%
2010	875,593	40% (10% of salary)	100%

The single figure of remuneration for 2018, 2015 and 2012 are higher than in other years due to the vesting of the three year Long Term Bonus Performance Plan in those years delivering a reward of £1,343,995 (93.33% vesting), £945,750 (97% vesting) and £900,000 (90% vesting)respectively forthe three year period ended in that year.

Percentage increase in the CEO's remuneration

The table below compares the percentage increase in the CEO's remuneration (including salary, fees, benefits and annual bonus) with the remuneration of Big Yellow Group employees.

		% increase in remuneration in 2018 compared with 2017
	CEO	Employees
Salary and fees	2%	2%
All taxable benefits	(10%)	2%
Annual bonuses	29%	29%

Statement of consideration of employment conditions elsewhere in the Group

The Committee reviews the reward and retention of the whole employee population periodically throughout the year to ensure that it can attract and retain top talent. Particular consideration is given to the general basic salary increase, remuneration arrangements and employment conditions. Furthermore, the cash annual bonus awarded to Executive Directors is directly linked to the bonuses awarded to all staff.

The Directors are invited to be present at this review of the proposals for salary increase for the employee population generally and on any other changes to remuneration policy within the Company. The information presented at this review is taken into consideration when setting the pay levels of the executive population. Additionally, the Committee has guidelines for the grant of all LTIP awards across the Company and responsibility for approving the total annual bonus cost of the Company.The Company does not invite employees to comment on the remuneration of Directors.

Relative importance of spend on pay

The graph below sets out the relative importance of spend on pay in the year ended 31 March 2018 and 31 March 2017 compared with other disbursements from profit, being the distributions to shareholders and retained earnings (comprehensive gain for the year less dividends).

Gender pay

The Group has reported on its gender pay gap for 2017.The full report can be found on the investor relationswebsite http://corporate.bigyellow.co.uk/investors.aspx. TheGroup'smeangender pay gapwas26%,withamediangap of10%. Excluding ExecutiveDirectors (three ofwhomwere founders ofthe business),themeangender pay gap falls to 12%with amedian gap of 9%. All staff are paid equally according to job role.

The Group recognises that its success stems from attracting the right people and creating a diverse and gender balanced workforce, which not only reflects the communities in which the Group operates but also ensures a fully motivated and engaged team. The Group will ensure that every policy and practice encourages inclusive ways of working, in line with the Big Yellow culture.

Flexible working is promoted across the organisation, with a number of Head Office employees being home based, others working flexibly from home and all employees being able to work from any location within the business.

The family friendly policies include enhanced maternity, paternity and adoption pay and the Group's parental leave policy encourages both men and women to share childcare commitments.

The Group will continue to recruit based on merit and ensure that recruitment processes are bias free. The Group has recently recruited a female at senior management level to replace a position previously held by a male employee and will continue to endeavour to increase the number of women in all senior positions. In addition, the Group intends to review our recruitment practices to actively increase the representation of women within store management positions, as well as better utilising internal development programmes to encourage a greater number of women to progress within the Group.The Group will also be introducing a specific return to work programme for employees returning from maternity leave.

Advisers to the Remuneration Committee

In undertaking its responsibilities, the committee seeks independent external advice as necessary.To this end, FIT Remuneration Consultants LLP replaced PwC as the principal external advisers to the Committee during the financial year, following a tender process overseen by the Committee.The Committee is comfortable thatthe FITteam provides independentremuneration advice to the Committee and does not have any other connectionswith Big Yellowthat may impair their independence. FIT is a founding member and signatory of the Code of Conduct for Remuneration Consultants, details of which can be found at www.remunerationconsultantsgroup.com.

During the year, FIT provided independent advice on a wide range of remuneration matters including the Remuneration Policy review. FIT provides no other services to the Company.The fees paid to FITin respect of work carried out for the year under review were £55,000.

Attendance at Remuneration Committee meetings

Attendance at meetings of the individual Directors at the Remuneration Committee Meetings that they were eligible to attend is shown in the table below:

Number of meetings attended

attended absent

Approval

This policy report was approved by the Board of Directors on 21 May 2018 and signed on its behalf by

Georgina Harvey

Remuneration Committee Chair

Audit Committee Report

Year ended 31 March 2018

INTRODUCTION

The Audit Committee is appointed by the Board from the Non-Executive Directors of the Group.The Audit Committee's terms of reference include all matters indicated by Disclosure and Transparency Rule 7.1 and the UK Corporate Governance Code. The terms of reference are considered annually by the Audit Committee and are then referred to the Board for approval.

The Audit Committee is responsible for:

• > monitoring the integrity of the financial statements of the Group and any formal announcements relating to the Group's financial performance and reviewing significant financial reporting judgements contained therein;
• > reviewing the Group's internal financial controls and the Group's internal control and risk management systems, including consideration of the need for an internal audit function;
• > making recommendations to the Board, for a resolution to be put to the shareholders for their approval in general meetings, on the appointment of the external auditor and the approval of the remuneration and terms of engagement of the external auditor;
• > reviewing and monitoring the external auditor's independence and objectivity and the effectiveness of the audit process, taking into consideration relevant UK professional and regulatory requirements; and
• > developing and implementing a policy on the engagement of the external auditor to supply non-audit services, taking into account relevant guidance regarding the provision of non-audit services by the external audit firm.

The Audit Committee is required to report its findings to the Board, identifying any matters on which it considers that action or improvement is needed, and make recommendations on the steps to be taken.

This year the Committee has continued to focus on the narrative reporting and corporate governance disclosures in the Annual Report.The Committee was asked by the Board to review the statement by the Directors that the Annual report presents a fair, balanced and comprehensive view of the Group's performance, strategy and business model.

Committee Members and Attendance

Member	Position	Number of meetings attended
Tim Clark	Member
Richard Cotton	Member
Georgina Harvey	Member
Steve Johnson	Member
Anna Keay	Member (from 1 March 2018)
Mark Richardson	Chairman (until 31 May 2017)
Vince Niblett	Chairman (from 1 June 2017)

attended

absent

All Audit Committee members are expected to be financially literate. Furthermore, the Audit Committee structure requires the inclusion of one financially qualified member (as recognised by the Consultative Committee of Accountancy Bodies). Currently Vince Niblett, as a Fellow of the Institute of Chartered Accountants of England and Wales, fulfils this requirement.

The Group provides an induction programme for new Audit Committee members and ongoing training to enable all of the Committee members to carry out their duties.The induction programme covers the role of the Audit Committee, its terms of reference and expected time commitment by members and an overview of the Group's business, including the main business and financial dynamics and risks. New Committee members also meet some ofthe Group's staff.

Ongoing training includes attendance at formal conferences, internal company seminars and briefings by external advisers.

Meetings

The Audit Committee is required tomeetthree times per year and has an agenda linked to events in the Group's financial calendar.The agenda is predominantly cyclical and is therefore approved by the Audit Committee Chairman on behalf of his fellow members. Each Audit Committee member has the right to require reports on matters of interest in addition to the cyclical items.

The Audit Committee invites the Chief Executive, Chief Financial Officer, Financial Controller, and senior representatives of the external auditor to attend all of its meetings in full, although it reserves the right to request any of these individuals to withdraw.The Committee may meet with the external auditor without the Executive Directors or senior management present. Other senior management are invited to present such reports as are required for the Committee to discharge its duties.

Overview of the actions taken by the Audit Committee to discharge its duties

Since the beginning of the financial year the Audit Committee has:

• > reviewed published financial information including the year end results, Annual Report, half year results and the Interim Management Statements;
• > considered whether the Annual Report provides a fair, balanced and comprehensive view of the Group's performance, strategy and business model;
• > assessed and concluded on the Group's viability statement;
• > considered the output from the Group-wide process used to identify, evaluate and mitigate risks;
• > reviewed the effectiveness of the Group's internal controls and disclosures made in the annual report and financial statements on this matter;
• > reviewed and agreed the scope of the audit work to be undertaken by the external auditor;
• > agreed the fees to be paid to the external auditor for their audit of the March 2018 financial statements and September half-yearly report;
• > considered and agreed the approach of performing Directors' valuations of investment properties for the half-year report;
• > undertaken an assessment of the qualification, expertise and resources, and independence of the external auditor and the effectiveness of the audit process;
• > considered the audit partner and audit firm rotation;
• > undertaken an evaluation of the performance of the external auditor;
• > assessed the effectiveness of the external auditor;
• > reviewed the nature and extent of interaction with the FRC's Corporate Reporting Review team.The Company received a letter during the year from the FRC with suggestions for minor areas of improvement of disclosure in the financial statements.These have been addressed in these financial statements.The FRC's review only covered the specific disclosures relating to this review and provides no assurance that the report and accounts are correct in all material respects; the FRC's role is not to verify the information provided but to consider compliance with reporting requirements;
• > considered the need for an internal audit function;
• > reviewed the arrangements for "whistleblowing" by employees to ensure that there is a consistent policy in the Group to enable employees to voice concerns particularly in respect of possible financial reporting improprieties. A whistleblowing policy is included in the employee handbook and during the year an external whistleblowing service was introduced;
• > met the Group's external valuers;
• > met the Group's Store Compliance Manager;
• > reviewed the Audit Committee's Report; and
• > reviewed its own effectiveness.

Financial reporting and significant financial judgements

The Committee reviews all financial information published by the Group in year end and half-yearfinancial statements, including the presentation and disclosure of the financial information. It also considers the appropriateness of the accounting policies adopted by the Group and the accounting judgements made by management in the preparation of the financial information.

The Committee has considered whether the Annual Report for the year ended 31March 2018 provides a fair, balanced and comprehensive view of the Group's performance, strategy and businessmodel andwhetherit provides the necessary information to enable shareholders and prospective shareholders to assess the Group's performance, strategy and business model.The Committee is satisfied that the Annual Report for the year ended 31 March 2018 provides a fair, balanced and comprehensive viewand includes the necessary information as set out above.The Committee has confirmed this to the Board,whose statement is included in the Statement of Directors' Responsibilities on page 90.

The Committee focuses on matters it considers important in their impact on the reported results of the Group, and on matters where there is a high degree of complexity and/or judgement.

The key area of judgement that the Committee focuses on at the reporting date is the valuation of the investment property portfolio. This is carried out by independent external valuers, but by its nature it is subjective, with significant judgement applied to the valuation, particularly given the lack of transactional evidence for prime self storage assets. The Chairman of the Committee met the external valuers to discuss the valuations, review the key judgements and discussed whether there were any disagreements with management.This year the Committee reviewed and challenged the valuers on the cap rates, rental growth assumptions and stabilised occupancy levels,to agree on the appropriateness ofthe assumptions adopted.The Committee also challenged the valuers and satisfied itself on their independence, their quality control processes (including peer partner review) and qualifications to carry out the valuations. Management also have processes in place to review the external valuations. In addition, the external auditors use specialists to review the valuations and report their findings and conclusions to the Audit Committee.

TheCommitteehas also consideredanumber of otherjudgementsmadebymanagementinthepreparationofthe financial statements.Therehavebeennobusiness combinations in the year.The Committee has concluded thatthere is not a significantlevel of judgements involved, otherthan the valuation described above.

Management have reported to the Audit Committee that they are satisfied that they are not aware of any material misstatements in the financial statements. The auditors confirmed in their report to the Audit Committee that they had not found any material misstatements during their audit work.

Based on the above, the Committee concluded that the financial statements appropriately apply the key estimates and critical judgements, in respect of the disclosures and the amounts reported. The Committee also concluded that the annual report and financial statements, taken as a whole, are fair, balanced and comprehensive and provide the information necessary for shareholders to assess the Company's performance, business model and strategy.

Audit Committee Report (continued)

Year ended 31 March 2018

External auditor

The Audit Committee is responsible for the development, implementation and monitoring of the Group's policy on external audit.The policy assigns oversight responsibility for monitoring the independence, objectivity and compliance with ethical and regulatory requirements to the Audit Committee, and day-to-day responsibility to the Chief Financial Officer.The policy states that the external auditor is jointly responsible to the Board and the Audit Committee and that the Audit Committee is the primary contact.

To fulfil its responsibility regarding the independence of the external auditor, the Audit Committee reviewed:

• > the external auditor's plan for the current year, noting the role of the senior statutory audit partner, who signs the audit report and who, in accordance with professional rules, has not held office for more than five years, and any changes in the key audit staff;
• > the arrangements for day-to-day management of the audit relationship;
• > a report from the external auditor describing their arrangements to identify, report and manage any conflicts of interest;
• > the overall extent of non-audit services provided by the external auditor, in addition to its case-by-case approval of the position of non-audit services by the external auditor; and
• > the past service of the auditor who was appointed in the current financial year.

Audit rotation

During the prior yearfollowing a robusttender process,the Committee appointed KPMG LLP as auditors. As part ofthe tender process,the Committee reviewed KPMG's proposals for the audit and determined that they had an appropriate plan in place to carry out an effective audit. KPMG confirmed to the Committee that it maintained appropriate internal safeguards to ensure its independence and objectivity.

The Company is in compliancewith the requirements ofthe Statutory Audit Services for Large CompaniesMarketInvestigation (Mandatory Use of Competitive Tender Processes and Audit Committee Responsibilities) Order 2014 and the Code.

Annual auditor assessment

The Audit Committee has adopted a formal framework in its review of the effectiveness of the external audit process and audit quality which include the following areas:

• > the arrangements for ensuring the external auditor's independence and objectivity;
• > the lead audit engagement partner and the audit team;
• > the external auditor's fulfilment of the agreed audit plan and variations from the plan;
• > the quality of the formal audit report to shareholders;
• > the robustness and perceptiveness of the auditor in his handling of the key accounting and audit judgements; and
• > the content of the external auditor's comments on control improvement recommendations.

Regard is paid to the nature of, and remuneration received, for other services provided by KPMG LLP to the Group and, inter alia, confirmation is sought from them that the fee payable for the annual audit is adequate to enable them to perform their obligations in accordance with the scope of the audit. Where nonaudit services are provided, the fees are based on the work undertaken and are not success related.

Non-audit work

The Group's policy on external audit sets outthe categories of non-audit serviceswhich the external auditorwill andwill not be allowed to provide to the Group, including those that are pre-approved by the Audit Committee and those which require specific approval before they are contracted for, subjectto de minimis levels.They may not provide a service which places them in a position where they may be required to audit their own work. Specifically, they are precluded fromproviding services relating to bookkeeping, financial information systemdesign and implementation, appraisal or evaluation services, actuarial services, any management functions, investment banking services, legal services unrelated to the audit or advocacy services.

In respect of the year ended 31March 2018, the auditor's remuneration comprised £188,000 for audit work and £30,000 for other work, solely relating to the interim review. Over a three year rolling period, the level of non-audit fees is below the audit fee, with non-audit fees representing 45% of audit fees in 2017 and 61% in 2016, in both cases payable to the predecessor auditor Deloitte LLP.

Risk management and internal control

The Committee and the Board reviewed the internal control processes ofthe business and the Group's risk register during the year.The risks and uncertainties facing the Group, and its internal control processes are considered in the Strategic Report on page 34.

Internal audit

The Committee has considered the Board's viewthat, given the relatively straightforward nature ofthe Group's business and the control environmentin place, no formal internal audit function is required.The Group has a store compliance team, which effectively carries out an internal audit role for the Group's stores. Additionally, the Board will appoint external consultants to assess specific business areas of risk and provide a report to the Board and the Committee on this area. For example, the construction programme was assessed by an external consultant in 2016 with satisfactory results. Similarly, the Board intends to appoint a consultant to review the Group's tax procedures during the year ending 31 March 2019.

The Committee concurswithmanagement's viewthat, in viewofthese arrangements, no formal internal auditfunction is necessary forthe business atthis time.

Overview

As a result of its work during the year, the Audit Committee has concluded that it has acted in accordance with its terms of reference and has ensured the independence and objectivity of the external auditor.

The Chairman of the Audit Committee will be available at the Annual General Meeting to answer any questions about the work of the Committee.

Approved by the Audit Committee and signed on its behalf by:

Vince Niblett Audit Committee Chairman 21 May 2018

Statement of Directors' Responsibilities

Directors' responsibilities

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable laws and regulations.

Company law requires the Directors to prepare Group and parent Company financial statements for each financial year. Under that law they are required to prepare the Group financial statements in accordance with International Financial Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU) and applicable law and have elected to prepare the parent Company financial statements on the same basis.

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and parent Company and of their profit or loss for that period. In preparing each of the Group and parent Company financial statements, the Directors are required to:

• > select suitable accounting policies and then apply them consistently;
• > make judgements and estimates that are reasonable, relevant and reliable;
• > state whether they have been prepared in accordance with IFRSs as adopted by the EU;
• > assess the Group and parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and
• > use the going concern basis of accounting unless they either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.

The Directors are responsible for keeping adequate accounting records that are sufficientto showand explain the parent Company's transactions and disclose with reasonable accuracy at any time the financial position of the parent Company and enable them to ensure that its financial statements comply with the Companies Act 2006.They are responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error, and have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.

Under applicable law and regulations, the Directors are also responsible for preparing a Strategic Report, Directors' Report, Directors' Remuneration Report and Corporate Governance Statement that complies with that law and those regulations.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the company's website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Responsibility statement of the Directors in respect of the annual financial report

We confirm that to the best of our knowledge:

• > the financial statements, prepared in accordancewith the applicable set of accounting standards, give a true and fair viewofthe assets, liabilities, financial position and profit or loss of the Company and the undertakings included in the consolidation taken as a whole; and
• > the strategic report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

We consider the annual report and accounts, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group's position and performance, business model and strategy.

This responsibility statement was approved by the Board of Directors on 21 May 2018 and is signed on its behalf by:

James Gibson John Trotman

Chief Executive Officer Chief Financial Officer

1. Our opinion is unmodified

We have audited the financial statements of Big Yellow Group PLC ("the Company") for the year ended 31 March 2018 which comprise the Consolidated Statement of Comprehensive Income, Consolidated and Parent Company Balance Sheets, Consolidated and Parent Company Statements of Changes in Equity, Consolidated and Parent Company Cash Flow Statements, and the related notes, including the accounting policies in notes 2 and 29.

In our opinion:

• > the financial statements give a true and fair viewofthe state ofthe Group's and ofthe parent Company's affairs as at 31March 2018 and ofthe Group's profit for the year then ended;
• > the Group financial statements have been properly prepared in accordancewith International Financial Reporting Standards as adopted by the European Union (IFRSs as adopted by the EU);
• > the parent Company financial statements have been properly prepared in accordance with IFRSs as adopted by the EU; and
• > the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Our responsibilities are described below. We believe that the audit evidence we have obtained is a sufficient and appropriate basis for our opinion. Our audit opinion is consistent with our report to the audit committee.

We were appointed as auditor by the shareholders on 20 July 2017. The period of total uninterrupted engagement is eight months for the financial year ended 31 March 2018. We have fulfilled our ethical responsibilities under, and we remain independent of the Group in accordance with, UK ethical requirements including the FRC Ethical Standard as applied to listed public interest entities. No non-audit services prohibited by that standard were provided.

Overview
Materiality:	£9.5m
Group financial statements as a whole	0.69% ofTotal Assets
Coverage	100% ofTotal Assets
Risks of material misstatement
Recurring Risks	Valuation of Investment Property, including Investment Property under Construction

Parent Company: Amounts owed by Group Undertakings

2. Key audit matters: our assessment of risks of material misstatement

Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of the financial statements and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. We summarise below the key audit matters in decreasing order of audit significance, in arriving at our audit opinion above, together with our key audit procedures to address those matters and, as required for public interest entities, our results from those procedures. These matters were addressed, and our results are based on procedures undertaken, in the context of, and solely forthe purpose of, our audit ofthe financial statements as awhole, and in forming our opinion thereon, and consequently are incidental to that opinion, and we do not provide a separate opinion on these matters.

Independent Auditor's Report to the Members of Big Yellow Group PLC (continued)

	The risk		Our response
Valuation of Investment Property,	Subjective Valuation		Our procedures included:
including Investment Property under Construction	Investment property fair values are calculated using actual and subjective assumptions inputs such as	>	Assessing valuer's credentials: We assessed the external valuer's qualifications and expertise and read
Investment Property £1,245.1m (2017: £1,154.4m)	store occupancy, net rent per square foot, discount rates and exit capitalisation rates. For investment		their terms of engagement with the Group to determine whether there were any matters that might have
Investment Property Under Construction £58.2m	property under construction additional estimates include expected costs to complete and the risk of		affected their objectivity or may have imposed scope limitations upon their work.
(2017: £36.1m)	not obtaining planning permission for non consented sites.	>	Methodology choice: We read the external valuation reports for 100% of the properties and assessed
Refer to page 87 (Audit Committee Report), note 2 (accounting policy) and note 15 (financial disclosures).	The Group employs external valuers to apply professional judgement concerning market conditions and factors impacting individual properties.	>	whether the valuation approach was in accordance with RICS standards and suitable for use in determining the final value for the purpose of the financial statements. Personnel interview: We met with the external valuer and the audit committee chairman with our own internal
	Investment property valuation is a significant and key risk of material misstatement as the valuation process is subjective and inherently judgemental in nature.		real estate specialist to discuss the valuation process, key assumptions such as occupancy, capitalisation and discount rates, and the rationale behind the more significant or unusual valuation movements during the
	The investment market for prime self storage is subject to market uncertainty due to the low volume of comparable transactions.	>	year. Our sector experience: We used our knowledge of the entity, our experience of the real estate industry and observed industry norms when assessing the key assumptions and the significant or unusual valuation movements and for investment property under construction we considered the judgement made by the directors and external valuers for planning risk for non consented sites.

• > Data provided to the valuer: We performed property visits and tested the current and historical accuracy of information used to generate key inputs to the valuation such as store occupancy and net rental income by physically inspecting a sample of storage units and reviewing a sample of customer storage license agreements.
• > Independent re-performance: Using our own internally produced model and the external valuer and management's inputs we assessed the reasonableness of valuation as produced by the external valuer.
• > Tests of detail: For investment property under construction we tested that the supporting information for construction contracts and budgets, which was also supplied to the valuer, was consistent with the Group's records for example by inspecting original construction contracts. We also obtained evidence that planning permission had been obtained for development sites.
• > Assessing Transparency: We assessed the Group's disclosures discussing the investment property and investment property under construction valuation and their sensitivities.

Our results

> We found the valuation of investment property and investment property under construction to be acceptable.

	The risk	Our response
Amounts owed by Group	Low risk, high value	Our procedures included:
Undertakings £470.6m (2017: £481.2m) Refer to note 29 (accounting policy) and note 31 (financial disclosures).	The carrying amount of the intra-group debtor balance represents 95.3% of the Company's total assets at 31 March 2018. Their recoverability is not at a high risk of significant misstatement or subject to significant judgement. However, due to their materiality in the context of the Company financial statements, this is considered to be the area that had the greatest effect on our overall Company audit.	> Test of details: We assessed 100% of Group debtors to identify, with reference to the relevant debtor's financial statements/draft balance sheet, whether they have a positive net asset value and therefore coverage of the debt owed, aswell as assessingwhetherthose subsidiary companies have historically been profit-making. > Assessing subsidiary audits: We considered the results ofthe work performed on the subsidiary audits, including assessing the liquidity of the assets and therefore the ability of the subsidiaries to fund the repayment of the receivable.
		Our results

> We found the assessment of the recoverability of the Group debtor balance to be acceptable.

3. Our application of materiality and an overview of the scope of our audit

The materiality for the Group financial statements as a whole was set at £9.5m determined with reference to a benchmark of total assets, of which it represents 0.69%.

In addition,we applied materiality of £3.0m to all balances and classes oftransactions impacting adjusted profit before tax (as reconciled to profit before tax in note 10 of the financial statements)for which we believe misstatements of lesser amounts than materiality for the financial statements as a whole could be reasonably expected to influence the Company's members' assessment of the financial performance of the group.

Materiality forthe parent Company financial statements as awholewas set at £4.9m, determinedwith reference to a benchmark of Company total assets of £493.8m, of which it represents 0.99%.

We agreed to report to the Audit Committee any corrected or uncorrected identified misstatements relating to line items above group profit before tax exceeding £475,000 and those relating to Balance Sheet classification exceeding £1.0m, in addition to other identified misstatements that warranted reporting on qualitative grounds.

Of the Group's 22 reporting components, we subjected six to audits for group reporting purposes These group procedures covered 99% of total group revenue; 99% of the total profits and losses that made up group profit before tax; and 100% of total group assets.

The remaining 1% total group revenue, 1% of the total profits and losses that made up group profit before tax and 0% of total group assets is represented by 16 reporting components, none of which individually represented more than 1% of any of total group revenue, group profit before tax or total group assets. For the residual components, we performed analysis at an aggregated Group level to re-examine our assessment that there were no significant risks of material misstatement within these.

The work on all the components, including the audit of the parent Company, was performed by the Group team at the head office in Bagshot, Surrey.

The Group team used component materialities, which ranged from £0.5m to £7.1m, having regard to the mix of size and risk profile of the Group across the components.

4. We have nothing to report on going concern

We are required to report to you if:

• > we have anything material to add or draw attention to in relation to the Directors' statement in note 2 to the financial statements on the use of the going concern basis of accounting with no material uncertainties that may cast significant doubt over the Group and Company's use of that basis for a period of at least twelve months from the date of approval of the financial statements; or
• > the related statement under the Listing Rules set out on page 38 is materially inconsistent with our audit knowledge.

We have nothing to report in these respects.

5. We have nothing to report on the other information in the Annual Report

The Directors are responsible forthe otherinformation presented in the Annual Reporttogetherwith the financial statements. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except as explicitly stated below, any form of assurance conclusion thereon.

Ourresponsibility is to read the otherinformation and, in doing so, considerwhether, based on ourfinancial statements auditwork,the information therein is materially misstated or inconsistent with the financial statements or our audit knowledge. Based solely on that work we have not identified material misstatements in the other information.

Strategic report and Directors' report

Based solely on our work on the other information:

• > we have not identified material misstatements in the strategic report and the Directors' report;
• > in our opinion the information given in those reports for the financial year is consistent with the financial statements; and
• > in our opinion those reports have been prepared in accordance with the Companies Act 2006.

Directors' remuneration report

In our opinion the part of the Directors' Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006.

Disclosures of principal risks and longer-term viability

Based on the knowledge we acquired during our financial statements audit, we have nothing material to add or draw attention to in relation to:

• > the Directors' confirmation within the Viability statement on page 38 that they have carried out a robust assessment of the principal risks facing the Group, including those that would threaten its business model, future performance, solvency and liquidity;
• > the Principal Risks and Uncertainties disclosures describing these risks and explaining how they are being managed and mitigated; and
• > the Directors' explanation in the Viability statement of how they have assessed the prospects of the Group, over what period they have done so and why they considered that period to be appropriate, and their statement as to whether they have a reasonable expectation that the Group will be able to continue in operation andmeetits liabilities as they fall due overthe period oftheir assessment, including any related disclosures drawing attention to any necessary qualifications or assumptions.

Under the Listing Rules we are required to review the Viability statement. We have nothing to report in this respect.

Corporate governance disclosures

We are required to report to you if:

• > we have identified material inconsistencies between the knowledge we acquired during our financial statements audit and the Directors' statement thatthey considerthatthe annualreport and financial statements taken as awhole is fair, balanced and understandable and provides the information necessary for shareholders to assess the Group's position and performance, business model and strategy; or
• > the section ofthe annualreport describing thework ofthe Audit Committee does not appropriately address matters communicated by us to the Audit Committee.

We are required to reportto you ifthe Corporate Governance Report does not properly disclose a departure from the eleven provisions ofthe UK Corporate Governance Code specified by the Listing Rules for our review.

We have nothing to report in these respects.

6. We have nothing to report on the other matters on which we are required to report by exception

Under the Companies Act 2006, we are required to report to you if, in our opinion:

• > adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us; or
• > the parent Company financial statements and the part of the Directors' Remuneration Report to be audited are not in agreement with the accounting records and returns; or
• > certain disclosures of Directors' remuneration specified by law are not made; or
• > we have not received all the information and explanations we require for our audit.

We have nothing to report in these respects.

7. Respective responsibilities

Directors' responsibilities

As explained more fully in their statement set out on page 90, the Directors are responsible for: the preparation of the financial statements including being satisfied that they give a true and fair view; such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement,whether due to fraud or error; assessing the Group and parent Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern; and using the going concern basis of accounting unless they either intend to liquidate the Group or the parent Company or to cease operations, or have no realistic alternative but to do so.

Auditor's responsibilities

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or other irregularities (see below), or error, and to issue our opinion in an auditor's report. Reasonable assurance is a high level of assurance, but does not guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud, other irregularities or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

A fuller description of our responsibilities is provided on the FRC's website at www.frc.org.uk/auditorsresponsibilities.

Irregularities – ability to detect

We identified areas of laws and regulations that could reasonably be expected to have a material effect on the financial statements from our sector experience, and through discussion with the Directors and other management (as required by auditing standards), and from inspection of the group's regulatory and legal correspondence.

We had regard to laws and regulations in areas that directly affect the financial statements including financial reporting (including related Company legislation) and taxation legislation. We considered the extent of compliance with those laws and regulations as part of our procedures on the related financial statement items.

We communicated identified laws and regulations throughout our team and remained alert to any indications of non-compliance throughout the audit.

As with any audit, there remained a higher risk of non-detection of non-compliance with relevant laws and regulations, as these may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls.

8. The purpose of our audit work and to whom we owe our responsibilities

This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditor's report and for no other purpose.To the fullest extent permitted by law,we do not accept or assume responsibility to anyone otherthan the Company and the Company'smembers, as a body, for our audit work, for this report, or for the opinions we have formed.

Steve Masters (Senior Statutory Auditor)

for and on behalf of KPMG LLP, Statutory Auditor Chartered Accountants Arlington Business Park,Theale, RG7 4SD 21 May 2018

Consolidated Statement of Comprehensive Income

Year ended 31 March 2018

	Note	2018 £000	2017 £000
Revenue	3	116,660	109,070
Cost of sales		(35,674)	(34,075)
Gross profit		80,986	74,995
Administrative expenses		(10,065)	(9,679)
Operating profit before gains on property assets		70,921	65,316
Gain on the revaluation of investment properties	14a,15	71,635	43,706
Gain on part disposal of investment property	14a	650	–
Operating profit		143,206	109,022
Share of profit of associates	14d	1,370	1,442
Investment income – interest receivable	7	244	356
– fair value movement on derivatives	7, 18	1,294	719
Finance costs	8	(11,975)	(11,756)
Profit before taxation		134,139	99,783
Taxation	9	(597)	(272)
Profit for the year (attributable to equity shareholders)	5	133,542	99,511
Total comprehensive income for the year (attributable to equity shareholders)		133,542	99,511
Basic earnings per share	12	85.0p	63.6p
Diluted earnings per share	12	84.4p	63.1p

EPRA earnings per share are shown in Note 12.

All items in the consolidated statement of comprehensive income relate to continuing operations.

Consolidated Balance Sheet

Year ended 31 March 2018

Note	2018 £000	2017 £000
Non-current assets
Investment property 14a	1,245,142	1,154,390
Investment property under construction 14a	58,157	36,115
Interests in leasehold property 14a	22,929	23,601
Plant, equipment and owner-occupied property 14b	3,092	3,216
Intangible assets 14c	1,433	1,433
Investment in associates 14d	9,276	7,452
Capital Goods Scheme receivable 16	2,385	4,091
Derivative financial instruments 18c	1,704	–
	1,344,118	1,230,298
Current assets
Inventories	283	283
Trade and other receivables 16	18,586	18,042
Cash and cash equivalents	6,853	6,906
	25,722	25,231
Total assets	1,369,840	1,255,529
Current liabilities
Trade and other payables 17	(36,828)	(36,935)
Borrowings 19	(2,474)	(2,356)
Obligations under finance leases 21	(2,061)	(2,005)
	(41,363)	(41,296)
Non-current liabilities
Derivative financial instruments 18c	–	(2,964)
Borrowings 19	(326,461)	(299,323)
Obligations under finance leases 21	(20,868)	(21,596)
	(347,329)	(323,883)
Total liabilities	(388,692)	(365,179)
Net assets	981,148	890,350
Equity
Share capital 22	15,857	15,788
Share premium account Reserves	46,362 918,929	45,462 829,100
Equity shareholders' funds	981,148	890,350

The financial statements were approved by the Board of Directors and authorised for issue on 21 May 2018.They were signed on its behalf by:

James Gibson John Trotman Director Director Company Registration No. 03625199

Consolidated Statement of Changes in Equity

Year ended 31 March 2018

	Share capital £000	Share premium account £000	Other non- distributable reserve £000	Capital redemption reserve £000	Retained earnings £000	Own shares £000	Total £000
At 1 April 2017	15,788	45,462	74,950	1,795	753,374	(1,019)	890,350
Total comprehensive income for the year	–	–	–	–	133,542	–	133,542
Issue of share capital	69	900	–	–	–	–	969
Dividend	–	–	–	–	(46,183)	–	(46,183)
Credit to equity for equity-settled
share based payments	–	–	–	–	2,470	–	2,470
At 31 March 2018	15,857	46,362	74,950	1,795	843,203	(1,019)	981,148

The other non-distributable reserve arose in the year ended 31 March 2015 following the placing of 14.35 million ordinary shares.

Year ended 31 March 2017
	Share capital £000	Share premium account £000	Other non- distributable reserve £000	Capital redemption reserve £000	Retained earnings £000	Own shares £000	Total £000
At 1 April 2016	15,737	45,227	74,950	1,795	692,697	(1,019)	829,387
Total comprehensive income for the year	–	–	–	–	99,511	–	99,511
Issue of share capital	51	235	–	–	–	–	286
Dividend	–	–	–	–	(41,158)	–	(41,158)
Credit to equity for equity-settled
share based payments	–	–	–	–	2,324	–	2,324
At 31 March 2017	15,788	45,462	74,950	1,795	753,374	(1,019)	890,350

Consolidated Cash Flow Statement

Year ended 31 March 2018

Note	2018 £000	2017 £000
Cash generated from operations 26	73,457	67,209
Interest paid	(9,724)	(10,980)
Interest received	13	16
Tax paid	(769)	(271)
Cash flows from operating activities	62,977	55,974
Investing activities
Sale of surplus land	–	300
Acquisition of Lock and Leave (net of cash acquired)	–	(14,239)
Purchase of non-current assets	(41,959)	(6,338)
Proceeds on part disposal of investment property	650	–
Receipts from Capital Goods Scheme	2,786	2,917
Investment in associate 14d	(900)	–
Dividend received from associates 14d	446	396
Cash flows from investing activities	(38,977)	(16,964)
Financing activities
Issue of share capital	969	286
Payment of finance lease liabilities	(1,109)	(1,196)
Equity dividends paid 11	(46,183)	(41,158)
Payment to cancel interest rate derivative	(3,374)	–
Increase/(decrease) in borrowings	25,644	(7,243)
Cash flows from financing activities	(24,053)	(49,311)
Net decrease in cash and cash equivalents	(53)	(10,301)
Opening cash and cash equivalents	6,906	17,207
Closing cash and cash equivalents	6,853	6,906

Notes to the Financial Statements

Year ended 31 March 2018

1. GENERAL INFORMATION

Big YellowGroup PLC is a Company incorporated in the United Kingdomunderthe Companies Act 2006.The address ofthe registered office is 2 The Deans, Bridge Road, Bagshot, Surrey, GU19 5AT.The nature of the Group's operations and its principal activities are set out in note 4 and in the Strategic Report on pages 16 to 28.

2. SIGNIFICANT ACCOUNTING POLICIES

Basis of preparation of financial statements

The financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted for use in the European Union in accordancewith EU law(IAS regulation EC1606/2002) and those parts ofthe Companies Act 2006 applicable to companies reporting underIFRS, and therefore the Group financial statements comply with Article 4 of the EU IAS Regulation.

The financial statements are presented in Sterling, being the currency ofthe primary economic environmentinwhich the Group operates. Unless otherwise stated, figures are rounded to the nearest thousand.

The accounting policies adopted are consistent with those of the previous financial year, except as described in the following sections.

Amendments to IFRSs that are mandatorily effective for the current year

In the current year,the Group has applied a number of amendments to IFRSs issued by the International Accounting Standards Board (IASB).Their adoption has not had any material impact on the disclosures or on the amounts reported in these financial statements.

Amendments to IAS 7	Statement of Cash Flow
Amendments to IAS 12	Income Taxes
IFRS 12	Disclosure of interests in other entities

New and revised IFRSs in issue but not yet effective

At the date of authorisation of these financial statements, the Group has not applied the following new and revised IFRSs that have been issued but are not yet effective:

IFRS 9	Financial Instruments
IFRS 15	Revenue from Contracts with Customers
IFRS 16	Leases
IFRS 2 (amendments)	Classification and Measurement of Share-based PaymentTransactions
IAS 7 (amendments)	Disclosure Initiative
IAS 12 (amendments)	Recognition of Deferred Tax Assets for Unrealised Losses
IFRS 10 and IAS 28 (amendments)	Sale or Contribution of Assets between an Investor and its Associate or Joint Venture

None ofthese standards not yet effective are expected to have a significantimpact on the Financial Statements ofthe Group or Company. Certain Standards which might have an impact are discussed below.

IFRS 9 – Financial Instruments

IFRS 9 covers the classification, measurement and derecognition of financial assets and liabilities. It also introduces a newimpairment model forfinancial assets and new rules for hedge accounting. The standard is applicable for financial years commencing on or after 1 January 2018, and hence the year ending 31 March 2019 will be the first applicable year for the Group.

There will be no impact on the Group's accounting for financial liabilities, as the new requirements only affect the accounting for financial liabilities that are designated at fair value through the income statement and the Group does not have any such liabilities.

The impairment model under IFRS 9 requires the recognition of impairment provisions based on expected credit losses ("ECL")rather than only incurred credit losses as is the case under IAS 39. The significant financial assets held by the Group that will be impacted by the impairment losses recognised under IFRS 9 are trade receivables.

Trade receivables in the balance sheet at 31 March 2018 were £3.7 million with an impairment provision recognised under IAS 39 of £0.01 million. As described in note 16, the Group's exposure to credit risk is low. The Directors have assessed the impact of impairment losses recognised for trade receivables under IFRS 9 at 31 March 2018 based on actual losses experienced over the past five years. Following this assessment, the impact and volatility on impairment losses recognised under IFRS 9 is estimated to be immaterial.

The Company holds intercompany loan and receivables balanceswith the subsidiaries ofthe Group as disclosed in Note 31.The Directors do not estimate there to be a material impact on the Company only Financial Statements from the recognition of impairment provisions for the loans and receivables under IFRS 9 compared to accounting for it held under IAS 39.

The new standard introduces enhanced disclosure requirements and changes in presentation.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

IFRS 15 – Revenue Recognition

IFRS 15 replaces IAS 18 and governs the recognition of revenue. The standard is applicable for financial years commencing on or after 1 January 2018, and hence the year ending 31March 2019 will be the first applicable year for the Group.The standard is based on the principle that revenue is recognised when control of a good or service transfers to a customer.

The Group's assessment is that IFRS 15 will apply to all its streams of revenue, although it is estimated that there will not be a material change in the amounts and timing of revenue recognised following the adoption of the standard. Each customer license agreement is terminable on seven days' notice by the customer at any time and in specific circumstances by the Group. This is an indicator IFRS 16 would not apply. Each licence has a discrete performance obligationwith revenue recognised from day one.The opening offer discountwas also assessed underIFRS 15 and the Group has concluded thatthe accounting forthiswill be unchanged following the introduction of IFRS 15 thatis to spread it evenly overthe period ofthe opening offer discount.

The standard also introduces enhanced disclosure requirements and changes in presentation.

IFRS 16 – Leases

IFRS 16 results in almost all leases being recognised on the balance sheetfor a lessee, as the distinction between operating and finance leases is removed. The standard is applicable forfinancial years commencing on or after 1 January 2019, and hence the year ending 31March 2020will be the first applicable year for the Group.

Under the standard, an asset, representing the right to use the leased item, and a financial liability to pay rentals are recognised.The only exceptions are short-term and low-value leases. The new standard changes the allocation of the finance lease payments over the length of the lease, resulting in the rental payments paid being more front ended in the income statement.The accounting for lessors will not significantly change.

The Group already classifies its leasehold stores as finance leases.The income statement charge forthese leases in the yearwas £2.1million. On adopting IFRS 16, the changes in the way the standard allocates the finance lease payments, would, we estimate, increase the rent charge in the first year of adoption by £0.3 million to £2.4 million.The Group has a limited number of operating leases, with non-cancellable future lease payments of £1.1 million at 31 March 2018.These will be brought onto balance sheet on adoption of the standard.

Basis of accounting

The financial statements have been prepared on the historical cost basis, except for the revaluation of investment properties and derivative financial instruments. Historical cost is generally based on the fair value of the consideration given in exchange for the assets.The principal accounting policies adopted, which have been applied consistently to the results, other gains and losses, assets, liabilities and cash flows of entities included in the consolidated financial statements in the current and preceding year, are set out below:

Going concern

A review of the Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Strategic Report. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are shown in the balance sheet, cash flow statement and accompanying notes to the financial statements. Furtherinformation concerning the Group's objectives, policies and processes formanaging its capital; its financialriskmanagement objectives; details of its financial instruments and hedging activities; and its exposures to creditrisk and liquidity risk can be found in the Strategic Report and in the notes to the financial statements.

After reviewing Group and Company cash balances, borrowing facilities, forecast valuation movements and projected cash flows, the Directors believe that the Group and Company have adequate resources to continue operations for the foreseeable future. In reaching this conclusion the Directors have had regard to the Group's operating plan and budget for the year ending 31March 2019 and projections contained in the longer term business plan which covers the period to March 2022. The Directors have carefully considered the Group's trading performance and cash flows as a result of the uncertain global economic environment and the other principal risks to the Group's performance, and are satisfied with the Group's positioning. For this reason, they continue to adopt the going concern basis in preparing the financial statements.

Basis of consolidation

The consolidated financial statements incorporate the financial statements ofthe Company and entities controlled by the Companymade up to31March each year. Control is achieved where the Company has the powerto directthe relevant activities of an investee entity so as to obtain benefits from its activities.

The Group consolidates the financial results and balance sheets of Big Yellow Group PLC and all of its subsidiaries at the year end using acquisition accounting principles. All intra-group transactions, balances, income and expenses are eliminated on consolidation. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by the Group.The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive income from the effective date of acquisition or up to the effective date of disposal, as appropriate.

The acquisition of subsidiaries is accounted for using the purchase method.The cost of the acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control ofthe acquiree. Any costs directly attributable to the business combination are recognised in the income statement. The acquiree's identifiable assets, liabilities and contingentliabilities that meetthe conditions for recognition under IFRS 3 are recognised attheir fair value atthe acquisition date, exceptfor non-current assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-Current Assets Held for Sale and Discontinued Operations, which are recognised and measured at the lower of their carrying amount and fair value less costs to sell (excluding investment property which is measured at fair value).

Notes to the Financial Statements (continued)

Year ended 31 March 2018

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Goodwill

Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business combination over the Group's interestin the netfair value ofthe identifiable assets, liabilities and contingentliabilities recognised. If, afterreassessment,the Group's interest in the net fair value of the acquiree's identifiable assets, liabilities and contingent liabilities exceeds the cost of the business combination, the excess is recognised immediately in the statement of comprehensive income. Goodwill is reviewed forimpairment atleast annually. Any impairmentis recognised immediately in the statement of comprehensive income and is not subsequently reversed.

Intangible assets

Intangible assets acquired in a business combination and recognised separately fromgoodwill are initially recognised attheirfair value attheir acquisition date (which is typically regarded as their cost). Subsequent to their initial recognition, intangible assets with indefinite useful lives are carried at cost less accumulated impairment losses. Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation and accumulated impairment losses. Amortisation is recognised on a straight line basis over their estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each reporting period with the effect of any changes in estimate being accounted for on a prospective basis.

Investment in associates

An associate is an entity over which the Group is in a position to exercise significant influence, but not control or joint control, through participation in the financial and operating policy decisions of the investee. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.

The results and assets and liabilities of associates are incorporated in these financial statements using the equity method of accounting except when classified as held for sale. Investments in associates are carried in the balance sheet at cost as adjusted by post-acquisition changes in the Group's share of the net assets of the associate, less any impairment in the value of individual investments. Losses of an associate in excess of the Group's interest in that associate (which includes any long-term interests that, in substance, form part of the Group's net investment in the associate) are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate. Where necessary, adjustments are made to the financial statements of associates to bring the accounting policies used into line with those used by the Group. Where a Group Company transacts with an associate of the Group, profits and losses are eliminated to the extent of the Group's interest in the relevant associate. Losses may provide evidence of an impairment of the asset transferred in which case appropriate provision is made for impairment.

Revenue recognition

Revenue represents amounts derived from the provision of services which fall within the Group's ordinary activities after deduction of trade discounts and any applicable value added tax. Self storage income is recognised overthe period forwhich the storage roomis occupied by the customer on a straightline basis.The opening offer discount of 50% off for up to 8 weeks is spread evenly over the term of the discount period.

Other storage related income comprises:

• > insurance income which is recognised on a straight line basis over the period a customer occupies their room; and
• > packing material sales are recognised at the point of sale, as there is no further ongoing performance obligation beyond the point of sale.

The Group recognises non-storage income, which is principally rental income from tenants of properties awaiting development, on a straight-line basis over the period in which it is earned.

Management fees earned are recognised on a straight-line basis over the period for which the services are provided. Fees earned from associates are recognised in full in the income statement through revenue with the proportionate debit shown in the share of profit of associate.

Operating leases

Rentals payable under operating leases are charged to the statement of comprehensive income on a straight-line basis overthe termofthe relevantlease. In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Borrowings

Interest-bearing loans and overdrafts are measured at fair value, net of direct issue costs. Premiums payable on settlement or redemption and direct issue costs are accounted for on an accruals basis in the statement of comprehensive income using the effective interest rate method and are added to the carrying value amount of the instrument to the extent that they are not settled in the period in which they arise. Borrowings are subsequently held at amortised cost.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Finance costs and income

All borrowing costs are recognised in the statement of comprehensive income in the period in which they are incurred, unless the costs are incurred as part ofthe development of a qualifying asset,when theywill be capitalised. Commencement of capitalisation is the datewhen the Group incurs expenditure for the qualifying asset, incurs borrowing costs and undertakes activities that are necessary to prepare the assets for their intended use when it is probable that they will result in future economic benefits to the entity and the costs can be measured reliably. In the case of suspension of activities during extended periods, the Group suspends capitalisation. The Group ceases capitalisation of borrowing costs when substantially all of the activities necessary to prepare the asset for use are complete, typically when a store opens.

Interest income is accrued on a time basis, by reference to the principal outstanding and the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's net carrying amount.

Debt modification

A change in debt carried at amortised cost that is considered substantial is accounted for as an extinguishment, which means that the original debt is derecognised, with a gain or loss is recorded in the income statement, and a new financial liability recorded based on the new terms. If the change is not considered to be substantial (substantial is defined as a change in the net present value of the cash flows of more than 10%), the original debt remains on the books and there is no current income statement impact.

Non-recurring items of income and expenditure

Non-recurring items of income and expenditure are recognised on the basis that they are unusual in nature and large in scale.

Operating profit

Operating profit is stated after gains and losses on surplus land, movements on the revaluation of investment properties and before the share of results of associates, investment income and finance costs.

Taxation

The tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the year.Taxable profit differs from the net profit as reported in the statement of comprehensive income because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible.The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary differences arise fromgoodwill orfromthe initialrecognition (otherthan in a business combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates substantively enacted at the balance sheet date that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the statement of comprehensive income, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

Deferred tax assets and liabilities are offset as there is a legally enforceable right to set off current tax assets against current tax liabilities.

Plant, equipment and owner occupied property

All property, plant and equipment, not classified as investment property, is carried at historic costless depreciation and any recognised impairmentloss.

Depreciation is charged so as to write off the cost or valuation of assets, other than land and investment properties, less any residual value over their estimated useful lives, using the straight-line method, on the following bases:

Freehold property	50 years
Leasehold improvements	over period of the lease
Plant and machinery	10 years
Motor vehicles	4 years
Fixtures and fittings	5 years
Computer equipment	3 to 5 years

The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in the income statement.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

Investment property

The criteria used to distinguish investment property from owner-occupied property is to consider whether the property is held for rental income and/or for capital appreciation.Where this is the case, the Group recognises these owned or leased properties as investment properties. Investment property is initially recognised at cost and revalued at the balance sheet date to fair value as determined by professionally qualified external valuers. In accordance with IAS 40, investment property held as a leasehold is stated gross of the recognised finance lease liability.

Gains or losses arising from the changes in fair value of investment property are included in the statement of comprehensive income for the period in which they arise. In accordance with IAS 40, as the Group uses the fair value model, no depreciation is provided in respect of investment properties including integral plant.

Leasehold properties that are leased under operating leases are classified as investment properties and included in the balance sheet at fair value.The obligation to the lessor for the buildings element of the leasehold is included in the balance sheet at the present value of the minimum lease payments at inception, and is shown within note 21. Lease payments are apportioned between finance charges and a reduction of the outstanding lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability.

Investment property under construction

Investment property under construction is initially recognised at cost and revalued atthe balance sheet date to fair value as determined by professionally qualified external valuers.

Gains or losses arising from the changes in fair value of investment property under construction are included in the statement of comprehensive income in the period in which they arise.

Impairment of assets

At each balance sheet date, the Group reviews the carrying amounts of its assets (excluding investment property and derivative financial instruments which are carried at fair value) to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).The recoverable amount is the higher of an asset's net selling price and its value-in-use (i.e. the net present value of its future cash flows discounted at the Group's average pre-tax interest rate that reflects the borrowing costs and risk for the asset).

Inventories

Inventories, representing the cost of packing materials, are stated at the lower of cost and net realisable value.

Financial instruments

Financial assets and financial liabilities are recognised on the Group's balance sheet when the Group becomes a party to the contractual provisions of the instrument. Financial assets at FVTPL are stated atfair value,with any gains orlosses arising on re-measurementrecognised in the income statement. The net gain or loss recognised in the income statement incorporates any dividend or interest earned on the financial asset and is included in the 'other gains and losses' line item in the income statement.

A – Derivative financial instruments and hedge accounting

The Group's activities expose it primarily to the financial risks of interest rates. The Group uses interest rate swap contracts to hedge these exposures. The Group does not use derivative financial instruments for speculative purposes. The use of financial derivatives is governed by the Group's policies approved by the Board of Directors.The policy in respect of interestrates is to maintain a balance between flexibility and the hedging of interestrate risk.

Derivatives are initially recognised at fair value and are subsequently reviewed at each balance sheet date.The fair value of interest rate derivatives at the reporting date is determined by discounting the future cash flows using the forward curves at the reporting date and the credit risk inherent in the contract.

Changes in the fair value of derivative financial instruments are recognised in the statement of comprehensive income as they arise.The Group has not adopted hedge accounting. Derivatives embedded in other financial instruments or other host contracts are treated as separate derivatives when their risks and characteristics are not closely related to those of host contracts and the host contracts are not carried at fair value with unrealised gains or losses reported in the statement of comprehensive income.

B – Loans and receivables

Trade receivables, loans, and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method, less any impairment. Interestincome is recognised by applying the effective interestrate, exceptfor short-termreceivableswhen the recognition of interest would be immaterial.

2. SIGNIFICANT ACCOUNTING POLICIES (continued)

C – Impairment of financial assets

Financial assets are assessed for indicators of impairment at each balance sheet date. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted.The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in the income statement.

D – Cash and cash equivalents

Cash and cash equivalents comprises cash on hand and demand deposits, and other short term highly liquid investments that are readily convertible to a known amount of cash and are subjectto an insignificantrisk of changes in value.The carrying amounts ofthese assets approximates to the fair value.

E – Financial liabilities and equity

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into.

F – Equity instruments

Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.

G – Trade payables

Trade payables are not interest bearing and are initially stated at fair value and subsequently recorded measured at amortised cost.

Retirement benefit costs

Pension costs represent contributions payable to defined contribution schemes and are charged as an expense to the statement of comprehensive income as they fall due.The assets of the schemes are held separately from those of the Group.

Share-based payments

The Group issues equity-settled share-based payments to certain employees. These are measured at fair value at the date of grant. The fair value determined at the grant date of the share-based payment is expensed on a straight-line basis over the vesting period, based on the Group's estimate of shares that will eventually vest.

Fair value is measured by use of the Black-Scholes model and excludes the effect of non-market based vesting conditions.The expected life used in the model has been adjusted, based onmanagement's best estimate, forthe effects of non-transferability, exercise restrictions, and behavioural considerations. At each balance sheet date, the Group revises its estimate of the number of equity instruments expected to vest as a result of the effect of non-market based vesting conditions. The impact of the revision of the original estimates, if any, is recovered in the income statement such that the cumulative expenses reflects the revised estimate with a corresponding adjustment to equity reserves.

For cash-settled share-based payments, a liability is recognised for the goods or services acquired, measured initially at the fair value of the liability. At each balance sheet date until the liability is settled, and at the date of settlement, the fair value of the liability is re-measured, with any changes in fair value recognised in the income statement for the year.

Critical accounting estimates and judgements

In the application ofthe Group's accounting policies,which are described above,the Directors are required tomake judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Estimate of fair value of Investment Properties and Investment Property under Construction (critical accounting estimate)

The Group's self storage centres and stores under development are valued using a discounted cash flow methodology which is based on projections of net operating income.The Group employs expert external valuers, Cushman&Wakefield LLP,who report on the values ofthe Group's stores on an annual basis. The stores within the Armadillo Partnerships are valued by Jones Lang LaSalle.The principal assumptions underlying the estimation of the fair value are those related to: stabilised occupancy levels; expected future growth in storage rents; capitalisation rates; and discount rates. A more detailed explanation of the background and methodology adopted in the valuation of the Group's investment properties is set out in note 15 to the financial statements.

Judgement of business combinations

The Directors assess whether the acquisition of property through the purchase of a corporate vehicle should be accounted for as an asset purchase or a business combination.Where the acquired corporate vehicle is an integrated set of activities and assets thatis capable of being conducted and managed to provide a return to investors, the transaction is accounted for as a business combination.Where there are no such significant items, the transaction is treated as an asset purchase.The Directors assess when the risks and rewards associated with an acquisition or disposal have transferred.There have been no business combinations in the year.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

3. REVENUE

Analysis of the Group's operating revenue can be found below and in the Portfolio Summary on page 20.

	2018 £000	2017 £000
Open stores
Self storage income	97,717	91,600
Other storage related income	16,494	15,189
Ancillary store rental income	524	526
	114,735	107,315
Other revenue
Non-storage income	950	885
Management fees earned	975	870
Total revenue	116,660	109,070

Non-storage income derives principally from rental income earned from tenants of properties awaiting development.

4. SEGMENTAL INFORMATION

IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the Chief Executive to allocate resources to the segments and to assess their performance. Given the nature of the Group's business, there is one segment, which is the provision of self storage and related services.

Revenue represents amounts derived fromthe provision of self storage and related serviceswhich fallwithin the Group's ordinary activities after deduction of trade discounts and value added tax.The Group's net assets, revenue and profit before tax are attributable to one activity, the provision of self storage and related services.These all arise in the United Kingdom in the current year and prior year.

5. PROFIT FOR THE YEAR

a) Profit for the year has been arrived at after charging/(crediting):

	2018 £000	2017 £000
Depreciation of plant, equipment and owner-occupied property	729	738
Depreciation of finance lease capital obligations	1,109	1,196
Gain on the revaluation of investment property	(71,635)	(43,706)
Profit on part disposal of investment property	(650)	–
Cost of inventories recognised as an expense	1,043	1,035
Employee costs (see note 6)	16,306	15,622
Operating lease rentals	127	133

b) Analysis of auditor's remuneration:

	2018 £000	2017 £000
Fees payable to the Company's auditor for the audit of the Company's annual accounts	156	156
Fess payable to the Company's auditor for the subsidiaries' annual accounts	32	30
Total audit fees	188	186
Audit related assurance services – interim review	30	31
Tax advisory services	–	19
Other assurance services – assurance of CSR report	–	22
Other services – planning consultancy	–	11
Other services	–	2
Total non-audit fees	30	85

Fees payable to KPMG LLP and their associates for non-audit services to the Company are not required to be disclosed because the consolidated financial statements are required to disclose such fees on a consolidated basis. Fees charged by KPMG LLP to the Group's associates, Armadillo Storage Holding Company Limited and Armadillo Storage Holding Company 2 Limited in the year amounted to £45,000 which all related to audit services.The prior year audit fees and non-audit fees disclosed were payable to Deloitte LLP.

6. EMPLOYEE COSTS

The average monthly number of full-time equivalent employees (including Executive Directors) was:

	2018	2017
	Number	Number
Sales	284	279
Administration	51	50
	335	329

At 31 March 2018 the total number of Group employees was 375 (2017: 361).

	2018 £000	2017 £000
Their aggregate remuneration comprised:
Wages and salaries	11,377	10,990
Social security costs	1,913	1,783
Other pension costs	546	525
Share-based payments	2,470	2,324
	16,306	15,622

Details of Directors' Remuneration is given on pages 66 to 85.The Directors are the only employees assessed as key management personnel.

7. INVESTMENT INCOME

	2018 £000	2017 £000
Bank interest receivable	13	16
Unwinding of discount on Capital Goods Scheme receivable	231	340
Total interest receivable	244	356
Change in fair value of interest rate derivatives	1,294	719
Total investment income	1,538	1,075

8. FINANCE COSTS

	2018 £000	2017 £000
Interest on bank borrowings	9,817	10,953
Capitalised interest	(360)	(128)
Interest on obligations under finance leases	992	931
Total interest payable	10,449	11,756
Refinancing costs	1,526	–
Total finance costs	11,975	11,756

The refinancing costs relate to the unamortised loan arrangement costs of the previous bank facility which was extinguished, and the write-off of the costs of the new bank facility in accordance with IAS 39.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

9. TAXATION

The Group converted to a REITin January 2007. As a result the Group does not pay UK corporation tax on the profits and gains from its qualifying rental business in the UK provided that it meets certain conditions. Non-qualifying profits and gains of the Group are subject to corporation tax as normal. The Group monitors its compliance with the REIT conditions.There have been no breaches of the conditions to date.

Finance (No.2) Bill 2015 provides that the rate of corporation tax for the 2017 Financial Year (commencing 1 April 2017) would be 19% and that the rate from 1 April 2020 will be 18%. At Budget 2016, the government announced a further reduction to the Corporation Tax main rate (for all profits except ring fence profits) for the year starting 1 April 2020, setting the rate at 17%. This rate was incorporated in Finance Act 2016 which was fully enacted on 15 September 2016.

	2018 £000	2017 £000
UK current tax:
– Current year	546	417
– Prior year	51	(145)
	597	272

A reconciliation of the tax charge is shown below:

	2018 £000	2017 £000
Profit before tax	134,139	99,783
Tax charge at 19% (2017 – 20%) thereon	25,486	19,957
Effects of:
Revaluation of investment properties	(13,734)	(8,741)
Share of profit of associates	(260)	(288)
Other permanent differences	(1,374)	(1,242)
Profits from the tax exempt business	(9,176)	(8,791)
Utilisation of brought forward losses	(11)	–
Movement on other unrecognised deferred tax assets	(385)	(478)
Current year tax charge	546	417
Prior year adjustment	51	(145)
Total tax charge	597	272

At 31 March 2018 the Group has unutilised tax losses of £32.1 million (2017: £32.6 million) available for offset against certain types of future taxable profits. All losses can be carried forward indefinitely.

10. ADJUSTED PROFIT

	2018 £000	2017 £000
Profit before tax	134,139	99,783
Gain on revaluation of investment properties – wholly owned	(71,635)	(43,706)
– in associate (net of deferred tax)	(724)	(756)
Change in fair value of interest rate derivatives – Group	(1,294)	(719)
– in associate	(60)	8
Gain on part disposal of investment property	(650)	–
Prior period VAT recovery	–	(328)
Acquisition costs written off	–	296
Refinancing costs	1,526	–
Share of associate acquisition costs written off	120	63
Adjusted profit before tax	61,422	54,641
Tax	(597)	(272)
Adjusted profit after tax	60,825	54,369

10. ADJUSTED PROFIT (continued)

Adjusted profit before tax which excludes gains and losses on the revaluation of investment properties, changes in fair value of interest rate derivatives, net gains and losses on disposal of investment property, and non-recurring items of income and expenditure have been disclosed as, in the Board's view, this provides a clearer understanding of the Group's underlying trading performance.

The refinancing costs of £1.5 million relate to the unamortised loan arrangement costs of the previous bank facility, and the write-off of the costs of the new bank facility in accordance with IAS 39.

11. DIVIDENDS

	2018	2017
	£000	£000
Amounts recognised as distributions to equity holders in the year:
Final dividend for the year ended 31 March 2017 of 14.1p (2016: 12.8p) per share.	22,107	20,003
Interim dividend for the year ended 31 March 2018 of 15.3p (2017: 13.5p) per share.	24,076	21,155
	46,183	41,158
Proposed final dividend for the year ended 31 March 2018 of 15.5p (2017: 14.1p) per share.	24,417	22,107

Subject to approval by shareholders at the Annual General Meeting to be held on 19 July 2018, the final dividend will be paid on 27 July 2018.The ex-div date is 21 June 2018 and the record date is 22 June 2018.

The Property Income Dividend ("PID") payable for the year is 27.5 pence per share (2017: 24.0 pence per share).

12. EARNINGS PER SHARE

		Year ended 31 March 2018		Year ended 31 March 2017
	Earnings £m	Shares million	Pence per share	Earnings £m	Shares million	Pence per share
Basic	133.5	157.1	85.0	99.5	156.5	63.6
Dilutive share options	–	1.0	(0.6)	–	1.2	(0.5)
Diluted	133.5	158.1	84.4	99.5	157.7	63.1
Adjustments:
Gain on revaluation of investment properties	(71.6)	–	(45.3)	(43.7)	–	(27.7)
Change in fair value of interest rate derivatives	(1.3)	–	(0.8)	(0.7)	–	(0.4)
Gain on part disposal of investment property	(0.6)	–	(0.4)	–	–	–
Acquisition costs written off	–	–	–	0.3	–	0.2
Prior period VAT recovery	–	–	–	(0.3)	–	(0.2)
Refinancing costs	1.5	–	1.0	–	–	–
Share of associate non-recurring gains and losses	(0.7)	–	(0.4)	(0.7)	–	(0.5)
EPRA – diluted	60.8	158.1	38.5	54.4	157.7	34.5
EPRA – basic	60.8	157.1	38.7	54.4	156.5	34.8

The calculation of basic earnings is based on profit after tax for the year.The weighted average number of shares used to calculate diluted earnings per share has been adjusted for the conversion of share options.

EPRA earnings and earnings per ordinary share have been disclosed to give a clearer understanding of the Group's underlying trading performance.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

13. NET ASSETS PER SHARE

The European Public Real Estate Association ("EPRA") has issued recommended bases for the calculation of net assets per share information and this is shown in the table below:

	31 March 2018 £000	31 March 2017 £000
Basic net asset value	981,148	890,350
Exercise of share options	1,105	820
EPRA NNNAV	982,253	891,170
Adjustments:
Fair value of derivatives	(1,704)	2,964
Fair value of derivatives – share of associate	17	77
Share of deferred tax in associates	794	626
EPRA NAV	981,360	894,837
Basic net assets per share (pence)	623.2	568.0
EPRA NNNAV per share (pence)	616.8	562.1
EPRA NAV per share (pence)	616.2	564.4
EPRA NAV (as above) (£000)	981,360	894,837
Valuation methodology assumption (see note 15) (£000)	77,706	68,530
Adjusted net asset value (£000)	1,059,066	963,367
Adjusted net assets per share (pence)	665.0	607.6

	No. of shares	No. of shares
Shares in issue	158,570,574	157,882,867
Own shares held in EBT	(1,122,907)	(1,122,907)
Basic shares in issue used for calculation	157,447,667	156,759,960
Exercise of share options	1,798,494	1,781,652
Diluted shares used for calculation	159,246,161	158,541,612

Net assets per share are equity shareholders' funds divided by the number of shares at the year end.The shares currently held in the Group's Employee Benefit Trust are excluded from both net assets and the number of shares. Adjusted net assets per share include the effect of those shares issuable under employee share option schemes and the effect of alternative valuation methodology assumptions (see note 15).

14. NON-CURRENT ASSETS

a) Investment property, investment property under construction and interests in leasehold property

	Investment property £000	Investment property under construction £000	Interests in leasehold property £000	Total £000
At 31 March 2016	1,092,210	33,945	20,165	1,146,320
Additions	17,817	2,827	1,871	22,515
Adjustment to present value	–	–	2,761	2,761
Revaluation (see note 15)	44,363	(657)	–	43,706
Depreciation	–	–	(1,196)	(1,196)
At 31 March 2017	1,154,390	36,115	23,601	1,214,106
Additions	8,147	33,012	–	41,159
Adjustment to present value	–	–	437	437
Transfer on opening of store	9,710	(9,710)	–	–
Revaluation (see note 15)	72,895	(1,260)	–	71,635
Depreciation	–	–	(1,109)	(1,109)
At 31 March 2018	1,245,142	58,157	22,929	1,326,228

14. NON-CURRENT ASSETS (continued)

a) Investment property, investment property under construction and interests in leasehold property (continued)

During the year the Group sold land at its Richmond store to an adjoining landowner for £650,000. The valuation of the store was not impacted by this disposal, hence the full proceeds have been recorded as profit on part disposal of investment property.This has been eliminated fromthe Group's adjusted profit for the year.

Additions to the interests in leasehold properties in the prior year relate to the lease atTwickenham 2, acquired from Lock and Leave in April 2016.

The income from self storage accommodation earned by the Group from its investment property is disclosed in note 3. Direct operating expenses, which are all applied to generating rental income, arising on the investment property in the year are disclosed in the Portfolio Summary on page 20. Included within additions is £0.4 million of capitalised interest (2017: £0.1 million), calculated at the Group's average borrowing cost for the year of 2.9%. 55 of the Group's investment properties are pledged as security for loans, with a total external value of £1,076.2 million.

b) Plant, equipment and owner occupied property

	Freehold property £000	Leasehold improvements £000	Plant and machinery £000	Motor vehicles £000	Fixtures, fittings & office equipment £000	Total £000
Cost
At 31 March 2016	2,183	101	592	25	1,498	4,399
Retirement of fully depreciated assets	–	(4)	(34)	–	(489)	(527)
Additions	6	–	91	30	422	549
Disposals	–	–	–	(23)	–	(23)
At 31 March 2017	2,189	97	649	32	1,431	4,398
Retirement of fully depreciated assets	–	(30)	(79)	–	(584)	(693)
Additions	8	7	121	–	469	605
At 31 March 2018	2,197	74	691	32	1,316	4,310
Depreciation
At 31 March 2016	(367)	(52)	(197)	(25)	(353)	(994)
Retirement of fully depreciated assets	–	4	34	–	489	527
Charge for the year	(42)	(2)	(102)	(5)	(587)	(738)
Disposals	–	–	–	23	–	23
At 31 March 2017	(409)	(50)	(265)	(7)	(451)	(1,182)
Retirement of fully depreciated assets	–	30	79	–	584	693
Charge for the year	(42)	(2)	(123)	(7)	(555)	(729)
At 31 March 2018	(451)	(22)	(309)	(14)	(422)	(1,218)
Net book value
At 31 March 2018	1,746	52	382	18	894	3,092
At 31 March 2017	1,780	47	384	25	980	3,216

c) Intangible assets

The intangible asset relates to the Big Yellow brand, which was acquired through the acquisition of Big Yellow Self Storage Company Limited in 1999. The carrying value remains unchanged from the prior year as there is considered to be no impairment in the value of the asset. The asset has an indefinite life and is tested annually for impairment or more frequently if there are indicators of impairment.

This was shown as goodwill in the prior year, but this has been restated to treat it as an intangible asset in both years, as this more fairly reflects the nature of the asset.

d) Investment in associates

Armadillo

The Group has a 20% interest in Armadillo Storage Holding Company Limited ("Armadillo 1") and a 20% interest in Armadillo Storage Holding Company 2 Limited ("Armadillo 2"). Both interests are accounted for as associates, using the equity method of accounting. Both companies are incorporated, registered and operate in England and Wales.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

14. NON-CURRENT ASSETS (continued)

d) Investment in associates (continued)

		Armadillo 1		Armadillo 2		Total
	31 March	31 March	31 March	31 March	31 March	31 March
	2018	2017	2018	2017	2018	2017
	£000	£000	£000	£000	£000	£000
At the beginning of the year	5,048	4,173	2,404	2,233	7,452	6,406
Subscription for capital	–	–	900	–	900	–
Share of results (see below)	937	1,093	433	349	1,370	1,442
Dividends	(255)	(218)	(191)	(178)	(446)	(396)
Share of net assets	5,730	5,048	3,546	2,404	9,276	7,452

In March 2018, Armadillo 2 raised £4.5 million of equity, which alongside additional debt from Lloyds, funded the acquisition of 1st Storage Centres. Big Yellow's equity invested was £0.9 million (20% of the total raised), with the balance funded by our partners. The Group's total subscription for partnership capital and advances in Armadillo 1 is £1,920,000 and £2,689,000 in Armadillo 2.

The investment properties owned by Armadillo 1 and Armadillo 2 have been valued at 31 March 2018 by Jones Lang LaSalle.

The figures below show the trading results of the Armadillo Partnerships, and the Group's share of the results and the net assets of the Armadillo Partnerships.

		Armadillo 1		Armadillo 2
	Year ended 31 March 2018 £000	Year ended 31 March 2017 £000	Year ended 31 March 2018 £000	Year ended 31 March 2017 £000
Income statement (100%) Revenue Cost of sales Administrative expenses	8,188 (4,247) (282)	6,324 (3,270) (207)	4,576 (1,919) (136)	4,159 (1,763) (88)
Operating profit Gain on the revaluation of investment properties Net interest payable Acquisition costs written off Fair value movement of interest rate derivatives Deferred and current tax	3,659 3,264 (938) (375) 147 (1,074)	2,847 3,725 (718) (316) 8 (78)	2,521 1,196 (813) (227) 154 (664)	2,308 322 (729) – (49) (109)
Profit attributable to shareholders Dividends paid	4,683 (1,275)	5,468 (1,091)	2,167 (957)	1,743 (890)
Retained profit	3,408	4,377	1,210	853
Balance sheet (100%) Investment property Interest in leasehold properties Other non-current assets Current assets Current liabilities Derivative financial instruments Non-current liabilities	53,176 1,403 1,149 1,177 (2,842) (52) (25,361)	43,375 – 1,125 1,177 (1,895) (199) (18,341)	38,205 3,233 1,989 1,480 (2,367) (34) (24,778)	25,900 3,526 1,487 867 (1,821) (188) (17,753)
Net assets (100%)	28,650	25,242	17,728	12,018
Group share Operating profit Gain on the revaluation of investment properties Net interest payable Acquisition costs written off Fair value movement of interest rate derivatives Deferred and current tax	732 653 (187) (75) 29 (215)	569 745 (144) (63) 2 (16)	504 239 (163) (45) 31 (133)	462 64 (146) – (10) (21)
Profit attributable to shareholders Dividends paid	937 (255)	1,093 (218)	433 (191)	349 (178)
Retained profit	682	875	242	171
Associates' net assets	5,730	5,048	3,546	2,404

15. VALUATION OF INVESTMENT PROPERTY

		Revaluation on
	Deemed cost £000	deemed cost £000	Valuation £000
Freehold stores
At 31 March 2017	583,297	527,613	1,110,910
Transfer from investment property under construction	11,763	(2,053)	9,710
Movement in year	7,780	73,452	81,232
At 31 March 2018	602,840	599,012	1,201,852
Leasehold stores
At 31 March 2017	16,210	27,270	43,480
Movement in year	367	(557)	(190)
At 31 March 2018	16,577	26,713	43,290
Total of open stores
At 31 March 2017	599,507	554,883	1,154,390
Transfer from investment property under construction	11,763	(2,053)	9,710
Movement in year	8,147	72,895	81,042
At 31 March 2018	619,417	625,725	1,245,142
Investment property under construction
At 31 March 2017	45,477	(9,362)	36,115
Transfer to investment property	(11,763)	2,053	(9,710)
Movement in year	33,012	(1,260)	31,752
At 31 March 2018	66,726	(8,569)	58,157
Valuation of all investment property
At 31 March 2017	644,984	545,521	1,190,505
Movement in year	41,159	71,635	112,794
At 31 March 2018	686,143	617,156	1,303,299

The Group has classified the fair value investment property and the investment property under construction within Level 3 of the fair value hierarchy. There has been no transfer to or from Level 3 in the year.

The wholly owned freehold and leasehold investment properties have been valued at 31March 2018 by external valuers, Cushman &Wakefield ("C&W"). The valuation has been carried out in accordance with the RICS Valuation – Global Standards, published by The Royal Institution of Chartered Surveyors ("the Red Book").The valuation of each of the investment properties and the investment properties under construction has been prepared on the basis of either Fair Value or Fair Value as a fully equipped operational entity, having regard to trading potential, as appropriate.

The valuation has been provided for accounts purposes and as such, is a Regulated Purpose Valuation as defined in the Red Book. In compliance with the disclosure requirements of the Red Book, C&W have confirmed that:

• > one of the members of the RICS who has been a signatory to the valuations provided to the Group for the same purposes as this valuation, has done so since September 2004.This is the third occasion on which the other member has been a signatory;
• > C&W have been carrying out this annual valuation for the same purposes as this valuation on behalf of the Group since September 2004;
• > C&W do not provide other significant professional or agency services to the Group;
• > in relation to the preceding financial year of C&W, the proportion of the total fees payable by the Group to the total fee income of the firm is less than 5%; and
• > the fee payable to C&W is a fixed amount per store, and is not contingent on the appraised value.

Market uncertainty

C&W's valuation report comments on valuation uncertainty resulting from low liquidity in the market for self storage property. C&W note that in the UK since Q1 2015 there have only been thirteen transactions involving multiple assets and ten single asset transactions. C&W state that due to the lack of comparable market information in the self storage sector, there is greater uncertainty attached to their opinion of value than would be anticipated during more active market conditions.

Portfolio Premium

C&W's valuation report further confirms that the properties have been valued individually but that if the portfolio was to be sold as a single lot or in selected groups of properties, the total value could differ significantly. C&W state that in current market conditions they are of the view that there could be a material portfolio premium.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

15. VALUATION OF INVESTMENT PROPERTY (continued)

Assumptions

• A. Net operating income is based on projected revenue received less projected operating costs together with a central administration charge of 6% of the estimated annual revenue subject to a cap and a collar.The initial net operating income is calculated by estimating the net operating income in the first 12 months following the valuation date.
• B. The net operating income in future years is calculated assuming either straight-line absorption from day one actual occupancy or variable absorption over years one to four ofthe cash flowperiod,to an estimated stabilised/mature occupancy level. In the valuation the assumed stabilised occupancy level forthe 74 trading stores (both freeholds and leaseholds) open at 31March 2018 averages 83.6% (31March 2017: 82.8%).The projected revenues and costs have been adjusted for estimated cost inflation and revenue growth.The average time assumed for the 74 stores to trade at their maturity levels is 16 months (31 March 2017: 22 months).
• C. The capitalisation rates applied to existing and future net cash flow have been estimated by reference to underlying yields for industrial and retail warehouse property, yields for other trading property types such as student housing and hotels, bank base rates, ten-year money rates, inflation and the available evidence of transactions in the sector. The valuation included in the accounts assumes rental growth in future periods. If an assumption of no rental growth is applied to the external valuation, the net initial yield pre-administration expenses for the 74 stores is 6.5% (31 March 2017: 6.5%) rising to a stabilised net yield pre-administration expenses of 6.9% (31 March 2017: 7.2%). The weighted average exit capitalisation rate adopted (for both freeholds and leaseholds)is 6.3% (31 March 2017: 6.6%).
• D. The future net cash flow projections (including revenue growth and cost inflation) have been discounted at a rate that reflects the risk associated with each asset.The weighted average annual discount rate adopted (for both freeholds and leaseholds)is 9.4% (31 March 2017: 9.7%).
• E. Purchaser's costs in the range of circa 6.1% to circa 6.8% (see below) have been assumed initially, reflecting the progressive SLDTrates brought into force in March 2016 and sale plus purchaser's costs totalling circa 7.1% to 7.8% are assumed on the notional sales in the tenth year in relation to the freehold and long leasehold stores.

Short leasehold

The same methodology has been used as for freeholds, except that no sale of the assets in the tenth year is assumed but the discounted cash flow is extended to the expiry of the lease.The average unexpired term of the Group's seven short leasehold properties is 14.0 years (31 March 2017: 15.0 years unexpired).

Sensitivities

As noted in 'Significant judgements and key estimates' on page 105, self storage valuations are complex, derived from data which is not widely publicly available and involve a degree of judgement. For these reasons we have classified the valuations of our property portfolio as Level 3 as defined by IFRS 13. Inputs to the valuations, some ofwhich are 'unobservable' as defined by IFRS 13, include capitalisation yields, stable occupancy rates, and rental growth rates. The existence of an increase of more than one unobservable input would augment the impact on valuation. The impact on the valuation would be mitigated by the inter-relationship between unobservable inputs moving in opposite directions. For example, an increase in stable occupancy may be offset by an increase in yield, resulting in no net impact on the valuation. A sensitivity analysis showing the impact on valuations of changes in yields and stable occupancy is shown below.

		Impact of a change in capitalisation rates	Impact of a change in stabilised occupancy assumption
	25 bps decrease 25 bps increase		1% increase	1% decrease
Reported group	£48.6m	(£44.9m)	£18.3m	(£19.1m)

A sensitivity analysis has not been provided for a change in the rental growth rate adopted as there is a relationship between this measure and the discountrate adopted. So, in theory, an increase in the rental growth ratewould give rise to a corresponding increase in the discountrate and the resulting value impact would be limited.

Investment properties under construction

C&W have valued the stores in development adopting the same methodology as set out above but on the basis of the cash flow projection expected for the store at opening and after allowing for the outstanding costs to take each scheme from its current state to completion and full fit-out. C&W have allowed for holding costs and construction contingency, as appropriate. Four schemes do not yet have planning consent and C&W have reflected the planning risk in their valuation.

15. VALUATION OF INVESTMENT PROPERTY (continued)

Immature stores: value uncertainty

C&W have assessed the value of each property individually. However, two of the Group's stores are relatively immature and have low initial cash flows. C&Whave endeavoured to reflect the nature of the cash flow profile for these properties in their valuation, and the higher associated risks relating to the as yet unproven future cash flows, by adjustment to the capitalisation rates and discount rates adopted. However, immature low cash flow stores of this nature are rarely, if ever, traded individually in the market, unless as part of a distressed sale or similar situation. Although, there is more evidence of immature low cash flow stores being traded as part of a group or portfolio transaction. Please note C&W's comments in relation to market uncertainty in the self storage sector due to the lack of comparable market transactions and information.The degree of uncertainty relating to the immature stores is greater than in relation to the balance of the properties due to there being even less market evidence that might be available for more mature properties and portfolios. C&W state that in practice, if an actual sale of the properties were to be contemplated then any immature low cash flow stores would normally be presented to the market for sale lotted or grouped with other more mature assets owned by the same entity, in order to alleviate the issue of negative orlowshort-termcash flow.This approachwould enhance themarketability ofthe group of assets and assistin achieving the best price available in the market by diluting the cash flow risk.

C&W have not adjusted their opinion of Fair Value to reflect such a grouping of the immature assets with other properties in the portfolio and all stores have been valued individually. However, they highlight the matter to alert the Group to the manner in which the properties might be grouped or lotted in order to maximise their attractiveness to the market place. C&W consider this approach to be a valuation assumption but not a Special Assumption, the latter being an assumption that assumes facts that differ from the actual facts existing at the valuation date and which, if not adopted, could produce a material difference in value. As noted above, C&W have not assumed that the entire portfolio of properties owned by the entity would be sold as a single lot and the value for the whole portfolio in the context of a sale as a single lot may differ significantly from the aggregate of the individual values for each property in the portfolio, reflecting the lotting assumption described above.

Valuation assumption for purchaser's costs

The Group's investment property assets have been valued for the purposes of the financial statements after deducting notional purchaser's cost of circa 6.1% to 6.8% of gross value, as if they were sold directly as property assets.The valuation is an asset valuation which is entirely linked to the operating performance of the business.The assets would have to be sold with the benefit of operational contracts, employment contracts and customer contracts, whichwould be very difficultto achieve exceptin a corporate structure.This approach follows the logic ofthe valuation methodology in thatthe valuation is based on a capitalisation of the net operating income after allowing a deduction for operational cost and an allowance for central administration costs. Sale in a corporate structurewould resultin a reduction in the assumed Stamp Duty Land Tax but an increase in othertransaction costs reflecting additional due diligence resulting in a reduced notional purchaser's cost of 2.75% of gross value. All the significant sized transactions that have been concluded in the UK in recent years were completed in a corporate structure. The Group therefore instructed C&W to carry out an additional valuation on the above basis, and this results in a higher property valuation at 31 March 2018 of £1,380.3 million (£77.0 million higher than the value recorded in the financial statements).The total valuations in the two Armadillo Partnerships performed by Jones Lang LaSalle are £3.3 million higher than the value recorded in the financial statements, of which the Group's share is £0.7 million. The sum of these is £77.7 million and translates to 48.8 pence per share. We have included this revised valuation in the adjusted diluted net asset calculation (see note 13).

16. TRADE AND OTHER RECEIVABLES

	31 March 2018	31 March 2017
	£000	£000
Current
Trade receivables	3,684	3,174
Capital Goods Scheme receivable	1,876	2,725
Other receivables	287	266
Prepayments and accrued income	12,739	11,877
	18,586	18,042
Non-current
Capital Goods Scheme receivable	2,385	4,091

Trade receivables are net of a bad debt provision of £14,000 (2017: £7,000).The Directors considerthatthe carrying amount oftrade and otherreceivables approximates their fair value.

The Financial Review contains commentary on the Capital Goods Scheme receivable.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

16. TRADE AND OTHER RECEIVABLES (continued)

Trade receivables

The Group does not typically offer credit terms to its customers, requiring them to pay in advance of their storage period and hence the Group is not exposed to significant credit risk. A late charge of 10% is applied to a customer's account if they are greater than 10 days overdue in their payment.The Group provides for receivables on a specific basis.There is a right of lien over the customers' goods, so if they have not paid within a certain time frame, we have the rightto sellthe items they store to recoup the debt owed.Trade receivables that are overdue are provided for based on estimated irrecoverable amounts determined by reference to past default experience.

For individual storage customers, the Group does not perform credit checks, however this is mitigated by the fact that these customers are required to pay in advance, and also to pay a deposit ranging between one week to four weeks' storage income. Before accepting a new business customer who wishes to use a number ofthe Group's stores,the Group uses an external creditrating to assess the potential customer's credit quality and defines credit limits by customer.There are no customers who represent more than 5% of the total balance of trade receivables.

Included in the Group's trade receivable balance are debtors with a carrying amount of £329,000 (2017: £250,000) which are past due at the reporting date for which the Group has not provided as there has not been a significant change in credit quality and the amounts are still considered recoverable. The average age of these receivables is 21 days past due (2017: 19 days past due).

Ageing of past due but not impaired receivables

	2018	2017
	£000	£000
1 – 30 days	264	214
30 – 60 days	30	23
60 + days	35	13
Total	329	250

Movement in the allowance for doubtful debts

	2018 £000	2017 £000
Balance at the beginning of the year	7	11
Amounts provided in year	114	63
Amounts written off as uncollectible	(107)	(67)
Balance at the end of the year	14	7

The concentration of credit risk is limited due to the customer base being large and unrelated. Accordingly, the Directors believe that there is no further credit provision required in excess of the allowance for doubtful debts.

Ageing of impaired trade receivables

	2018 £000	2017 £000
1 – 30 days	–	–
30 – 60 days	2	2
60 + days	12	5
Total	14	7

17. TRADE AND OTHER PAYABLES

	31 March 2018 £000	31 March 2017 £000
Current
Trade payables	12,739	13,279
Other payables	7,710	8,352
Accruals and deferred income	16,379	15,304
	36,828	36,935

The Group has financial risk management policies in place to ensure that all payables are paid within the creditterms.The Directors considerthe carrying amount of trade and other payables and accruals and deferred income approximates fair value.

18. FINANCIAL INSTRUMENTS

The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns while maximising the return to stakeholders through the optimisation of the debt and equity balance.The capital structure of the Group consists of debt, which includes the borrowings disclosed in note 19, cash and cash equivalents and equity attributable to equity holders of the parent, comprising issued capital, reserves and retained earnings. The Group's debt facilities require 40% of total drawn debt to be fixed.The Group has complied with this during the year.

With the exception of derivative instruments which are classified as a financial liability at fair value through the income statement ("FVTPL"), financial liabilities are categorised under amortised cost. All financial assets are categorised as loans and receivables.

Exposure to credit, interest rate and currency risks arises in the normal course of the Group's business. Derivative financial instruments are used to manage exposure to fluctuations in interest rates, but are not employed for speculative purposes.

A. Balance sheet management

The Group's Board reviews the capital structure on an ongoing basis. As part of this review, the Board considers the cost of capital and the risks associatedwith each class of capital.The Group seeks to have a conservative gearing ratio (the proportion of net debtto equity).The Board considers at each review the appropriateness of the current ratio in light of the above.The Board is currently satisfied with the Group's gearing ratio.

The gearing ratio at the year end is as follows:

	2018 £000	2017 £000
Debt	(330,599)	(304,955)
Cash and cash equivalents	6,853	6,906
Net debt	(323,746)	(298,049)
Balance sheet equity	981,148	890,350
Net debt to equity ratio	33.0%	33.5%

B. Debt management

The Group currently borrows through a senior term loan, secured on 25 self storage assets and sites, a 15 year loan with Aviva Commercial Finance Limited secured on a portfolio of 15 self storage assets, and a £70 million seven year loan from M&G Investments Limited secured on a portfolio of 15 self storage assets. Borrowings are arranged to ensure an appropriate maturity profile and to maintain short term liquidity. Funding is arranged through banks and financial institutions with whom the Group has a strong working relationship.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

18. FINANCIAL INSTRUMENTS (continued)

C. Interest rate risk management

The Group is exposed to interest rate risk as entities in the Group borrow funds at both fixed and floating interest rates.The risk is managed by the Group bymaintaining an appropriatemix between fixed and floating rate borrowings, and by the use of interestrate swap contracts. Hedging activities are evaluated regularly to alignwith interestrate views and defined risk appetite; ensuring optimal hedging strategies are applied, by either positioning the balance sheet or protecting interest expense through different interest rate cycles.

At 31 March 2018 the Group had two interest rate derivatives in place; £30 million fixed at 0.4% (excluding the margin on the underlying debt instrument) until October 2021, and £35 million fixed at 0.76% (excluding the margin on the underlying debt instrument) until June 2023.

Under interest rate swap contracts, the Group agrees to exchange the difference between fixed and floating rate interest amounts calculated on agreed notional principal amounts. Such contracts enable the Group to mitigate the risk of changing interest rates on the fair value of issued fixed rate debt held and the cash flowexposures on the issued variable rate debt held.The fair value of interestrate swaps atthe reporting date is determined by discounting the future cash flows using the curves at the reporting date and the credit risk inherent in the contract, and is disclosed below.The average interest rate is based on the outstanding balances at the end of the financial year.

The £30 million interest rate swap settles on a monthly basis.The floating rate on the interest rate swap is one month LIBOR.The Group settles the difference between the fixed and floating interest rate on a net basis.

The £35million interestrate swap settles on a three-monthly basis.The floating rate on the interestrate swap is threemonth LIBOR.The Group settles the difference between the fixed and floating interest rate on a net basis.

The Group does not hedge account for its interest rate swaps and states them at fair value, with changes in fair value included in the statement of comprehensive income. A reconciliation of the movement in derivatives is provided in the table below:

	2018 £000	2017 £000
At 1 April	(2,964)	(3,683)
Fair value movement in the year	1,294	719
Cancellation of interest rate derivative	3,374	–
At 31 March	1,704	(2,964)

The table below reconciles the opening and closing balances of the Group's finance related liabilities.

	Loans	Finance leases	Interest rate derivatives	Total
At 1 April 2017	(304,955)	(23,601)	(2,964)	(331,520)
Cash movement in the year	(25,644)	1,109	3,374	(21,161)
Non-cash movements	–	(437)	1,294	857
At 31 March 2018	(330,599)	(22,929)	1,704	(351,824)

D. Interest rate sensitivity analysis

In managing interest rate risks the Group aims to reduce the impact of short-term fluctuations on the Group's earnings, without jeopardising its flexibility. Over the longer term, permanent changes in interest rates may have an impact on consolidated earnings.

At 31 March 2018, it is estimated that an increase of 0.25 percentage points in interest rates would have reduced the Group's adjusted profit before tax and net equity by £445,000 (2017: reduced adjusted profit before tax by £375,000) and a decrease of 0.25 percentage points in interest rates would have increased the Group's adjusted profit before tax and net equity by £445,000 (2017: increased adjusted profit before tax by £375,000). The sensitivity has been calculated by applying the interest rate change to the variable rate borrowings, net of interest rate swaps, at the year end.

The Group's sensitivity to interest rates has increased during the year, following the increase in the amount of floating rate debt.The Board monitors closely the exposure to the floating rate element of our debt.

E. Cash management and liquidity

Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has built an appropriate liquidity risk management framework for the management of the Group's short, medium and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities. Included in note 19 is a description of additional undrawn facilities that the Group has at its disposal to further reduce liquidity risk.

Short term money market deposits are used to manage liquidity whilst maximising the rate of return on cash resources, giving due consideration to risk.

18. FINANCIAL INSTRUMENTS (continued)

F. Foreign currency management

The Group does not have any foreign currency exposure.

G. Credit risk

The creditriskmanagement policies ofthe Groupwith respectto trade receivables are discussed in note 16.The Group has no significant concentration of credit risk, with exposure spread over 55,000 customers in our stores.

The creditrisk on liquid funds is limited because the counterparties are bankswith high credit-ratings assigned by international credit-rating agencies.

H. Financial maturity analysis

In respect of interest-bearing financial liabilities, the following table provides a maturity analysis for individual elements.

2018 maturity	Total £000	Less than one year £000	One to two years £000	Two to five years £000	More than five years £000
Debt
Aviva loan	87,599	2,474	2,598	8,601	73,926
M&G loan payable at variable rate	35,000	–	–	–	35,000
M&G loan fixed by interest rate derivatives	35,000	–	–	–	35,000
Bank loan payable at variable rate	143,000	–	–	143,000	–
Debt fixed by interest rate derivatives	30,000	–	–	30,000	–
Total	330,599	2,474	2,598	181,601	143,926
2017 maturity	Total £000	Less than one year £000	One to two years £000	Two to five years £000	More than five years £000
Debt
Aviva loan	89,955	2,356	2,474	8,190	76,935
M&G loan payable at variable rate	35,000	–	–	–	35,000
M&G loan fixed by interest rate derivatives	35,000	–	–	–	35,000
Bank loan payable at variable rate	115,000	–	–	115,000	–
Debt fixed by interest rate derivatives	30,000	–	–	30,000	–
Total	304,955	2,356	2,474	153,190	146,935

I. Fair values of financial instruments

The fair values of the Group's cash and short term deposits and those of other financial assets equate to their book values. Details of the Group's receivables at amortised cost are set out in note 16. The amounts are presented net of provisions for doubtful receivables, and allowances for impairment are madewhere appropriate.Trade and other payables, including bank borrowings, are carried at amortised cost. Finance lease liabilities are included at the fair value of their minimum lease payments. Derivatives are carried at fair value.

For those financial instruments held at valuation, the Group has categorised them into a three level fair value hierarchy based on the priority of the inputs to the valuation technique in accordance with IFRS 7.The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure fair value fall within different levels ofthe hierarchy,the category level is based on the lowest priority level inputthatis significantto the fair value measurement ofthe instrument in its entirety.The fair value ofthe Group's outstanding interestrate derivative, as detailed in note 18C, has been estimated by calculating the present value of future cash flows, using appropriate market discount rates, representing Level 2 fair value measurements as defined by IFRS 7.There are no financial instruments which have been categorised as Level 1 or Level 3.The fair value of the Group's debt equates to its book value.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

18. FINANCIAL INSTRUMENTS (continued)

J. Maturity analysis of financial liabilities

The contractual maturities based on market conditions and expected yield curves prevailing at the year end date are as follows:

2018	Trade and other payables £000	Interest rate swaps £000	Borrowings and interest £000	Finance leases £000	Total £000
From five to twenty years	–	(63)	159,548	23,709	183,194
From two to five years	–	(1,139)	207,092	6,285	212,238
From one to two years	–	(381)	11,855	2,095	13,569
Due after more than one year	–	(1,583)	378,495	32,089	409,001
Due within one year	20,449	(195)	11,855	2,095	34,204
Total	20,449	(1,778)	390,350	34,184	443,205

2017	Trade and other payables £000	Interest rate swaps £000	Borrowings and interest £000	Finance leases £000	Total £000
From five to twenty years	–	127	166,652	25,556	192,335
From two to five years	–	1,493	180,928	6,116	188,537
From one to two years	–	692	11,930	2,039	14,661
Due after more than one year	–	2,312	359,510	33,711	395,533
Due within one year	21,631	816	11,930	2,039	36,416
Total	21,631	3,128	371,440	35,750	431,949

K. Reconciliation of maturity analyses

The maturity analysis in note 18J shows non-discounted cash flows for all financial liabilities including interest payments.The table belowreconciles the borrowings column in note 19 with the borrowings and interest column in the maturity analysis presented in note 18J.

2018	Borrowings £000	Interest £000	Unamortised borrowing costs £000	Borrowings and interest £000
From five to twenty years	143,926	13,958	1,664	159,548
From two to five years	181,601	25,491	–	207,092
From one to two years	2,598	9,257	–	11,855
Due after more than one year	328,125	48,706	1,664	378,495
Due within one year	2,474	9,381	–	11,855
Total	330,599	58,087	1,664	390,350

2017	Borrowings £000	Interest £000	Unamortised borrowing costs £000	Borrowings and interest £000
From five to twenty years	146,935	17,806	1,911	166,652
From two to five years	153,190	26,373	1,365	180,928
From one to two years	2,474	9,456	–	11,930
Due after more than one year	302,599	53,635	3,276	359,510
Due within one year	2,356	9,574	–	11,930
Total	304,955	63,209	3,276	371,440

19. BORROWINGS

Secured borrowings at amortised cost	31 March 2018 £000	31 March 2017 £000
Current liabilities
Aviva loan	2,474	2,356
	2,474	2,356
Non-current liabilities
Bank borrowings	173,000	145,000
Aviva loan	85,125	87,599
M&G loan	70,000	70,000
Unamortised loan arrangement costs	(1,664)	(3,276)
Total non-current borrowings	326,461	299,323
Total borrowings	328,935	301,679

The weighted average interest rate paid on the borrowings during the year was 2.9% (2017: 3.3%).

The Group has £37,000,000 in undrawn committed bank borrowing facilities at 31 March 2018, which expire between four and five years (2017: £45,000,000 expiring between four and five years).

The Group has a £100 million 15 yearfixed rate loanwith Aviva Commercial Finance Limited.The loan is secured over a portfolio of 15 freehold self storage centres.The annual fixed interest rate on the loan is 4.9%.The loan amortises to £60 million over the course of the 15 years.The debt service is payable monthly based on fixed annual amounts.

The Group has a £210 million five year revolving bank facility with Lloyds and HSBC expiring in October 2022, with a margin of 1.25%. The Group has an option to increase the amount of the loan facility by a further £60 million during the course of the loan's term, and an option to increase the term of the loan by a further two years.

The Group has a £70 million seven year loan withM&G Investments Limited, with a bullet repayment in June 2023.The loan is secured over a portfolio of 15 freehold self storage centres. Half of the loan is variable and half is subject to an interest rate derivative.

The Group was in compliance with its banking covenants at 31 March 2018 and throughout the year. The main covenants are summarised in the table below:

Covenant	Covenant level	At 31 March 2018
Consolidated EBITDA	Minimum 1.5x	7.9x
Consolidated net tangible assets	Minimum £250m	£981.1m
Bank loan income cover	Minimum 1.75x	14.2x
Aviva loan interest service cover ratio	Minimum 1.5x	4.1x
Aviva loan debt service cover ratio	Minimum 1.2x	2.7x
M&G income cover	Minimum 1.5x	7.5x

Interest rate profile of financial liabilities

	Total £000	Floating rate £000	Fixed rate £000	Weighted average interest rate	Period for which the rate is fixed	Weighted average period until maturity
At 31 March 2018 Gross financial liabilities	330,599	178,000	152,599	2.9%	6.5 years	5.5 years
At 31 March 2017 Gross financial liabilities	304,955	150,000	154,955	3.2%	7.0 years	5.9 years

All monetary liabilities, including short term receivables and payables are denominated in sterling.The weighted average interest rate includes the effect of the Group's interest rate derivatives.The Directors have concluded that the carrying value of borrowings approximates to its fair value.

Narrative disclosures on the Group's policy for financial instruments are included within the Strategic Report and in note 18.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

20. DEFERRED TAX

Deferred tax assets in respect of share based payments (£0.1 million), corporation tax losses (£4.5 million), capital allowances in excess of depreciation (£0.3million) and capital losses (£1.4million)in respect ofthe non-REITtaxable business have not been recognised due to uncertainty overthe projected tax liabilities arising in the short term within the non-REITtaxable business. A deferred tax liability in respect of interest rate swaps (£0.3 million) arising in the non-REITtaxable business has also not been recognised as the relevant entity has the legal right to settle the potential tax amounts on a net basis and these taxes are levied by the same taxing authority.

21. OBLIGATIONS UNDER FINANCE LEASES

	Minimum lease payments		Present value minimum of lease payments
	2018 £000	2017 £000	2018 £000	2017 £000
Amounts payable under finance leases:
Within one year	2,095	2,039	2,061	2,005
Within two to five years inclusive	8,380	8,155	7,390	7,193
Greater than five years	23,709	25,556	13,478	14,403
	34,184	35,750	22,929	23,601
Less: future finance charges	(11,255)	(12,149)
Present value of lease obligations	22,929	23,601

All lease obligations are denominated in sterling. Interestrates are fixed atthe contract date. All leases are on a fixed repayment basis and no arrangements have been entered into for contingent rental payments.The carrying amount of the Group's lease obligations approximates their fair value.

22. SHARE CAPITAL

	Called up, allotted and fully paid
	2018 £000	2017 £000
Ordinary shares of 10 pence each	15,857	15,788
Movement in issued share capital Number of shares at 31 March 2016 Exercise of share options – Share option schemes		157,369,287 513,580
Number of shares at 31 March 2017 Exercise of share options – Share option schemes		157,882,867 687,707
Number of shares at 31 March 2018		158,570,574

The Company has one class of ordinary shares which carry no right to fixed income.

22. SHARE CAPITAL (continued)

At 31 March 2018 options in issue to Directors and employees were as follows:

Date option Granted	Option price per ordinary share	Date first exercisable	Date on which the exercise period expires	Number of ordinary shares 2018	Number of ordinary shares 2017
19 July 2011	nil p **	19 July 2013	19 July 2021	–	2,400
11 July 2012	nil p **	11 July 2015	10 July 2022	5,359	8,559
19 July 2013	nil p **	19 July 2016	19 July 2023	7,059	78,469
25 February 2014	442.6p*	1 April 2017	1 October 2017	–	21,624
29 July 2014	nil p**	29 July 2017	29 July 2024	10,155	485,032
16 March 2015	494.6p*	1 April 2018	1 October 2018	94,654	95,016
21 July 2015	nil p**	21 July 2018	21 July 2025	373,093	379,293
14 March 2016	608.0p*	1 April 2019	1 October 2019	37,489	41,809
22 July 2016	nil p**	22 July 2019	21 July 2026	398,825	402,225
15 March 2017	580.0p*	1 April 2020	1 October 2020	59,550	65,374
2 August 2017	nil p**	2 August 2020	1 August 2027	407,311	–
13 March 2018	675.4p*	1 April 2021	1 October 2021	108,335	–
				1,501,830	1,579,801

* SAYE (see note 23)** LTIP (see note 23)

OWN SHARES

The own shares reserve represents the cost of shares in Big Yellow Group PLC purchased in the market, and held by the Big Yellow Group PLC Employee BenefitTrust, alongwith shares issued directly to the Employee BenefitTrust. 1,122,907 shares are held in the Employee BenefitTrust(2017: 1,122,907), and no shares are held in treasury.

23. SHARE-BASED PAYMENTS

The Company has three equity share-based payment arrangements, namely an LTIP scheme (with approved and unapproved components), an Employee Share Save Scheme ("SAYE") and a Long Term Bonus Performance Plan.The Group recognised a total expense in the year related to equity-settled sharebased payment transactions of £2,470,000 (2017: £2,324,000).

Equity-settled share option plans

Since 2004 the Group has operated an Employee Share Save Scheme ("SAYE") which allows any employee who has more than six months service to purchase shares at a 20% discount to the average quoted market price of the Group shares at the date of grant. The associated savings contracts are three years atwhich pointthe employee can exercise their option to purchase the shares ortake the amount saved, including interest, in cash.The scheme is administered by Yorkshire Building Society.

On an annual basis since 2004 the Group awarded nil-paid options to senior management underthe Group's Long Term Incentive Plan ("LTIP").The awards are conditional on the achievement of challenging performance targets as described on page 76 ofthe Remuneration Report.The awards granted in 2004, 2005 and 2006 vested in full. The awards granted in 2007 and 2009 lapsed, and the awards granted in 2008 and 2010 partially vested. The awards granted in 2011, 2012, 2013 and 2014 fully vested.The weighted average share price at the date of exercise for options exercised in the year was £7.25 (2017: £7.38).

LTIP scheme	2018 No. of options	2017 No. of options
Outstanding at beginning of year	1,355,978	1,444,221
Granted during the year	582,341	455,331
Lapsed during the year	(70,434)	(59,094)
Exercised during the year	(666,083)	(484,480)
Outstanding at the end of the year	1,201,802	1,355,978
Exercisable at the end of the year	22,573	89,428

The weighted average fair value of options granted during the year was £1,219,000 (2017: £1,017,000).

Notes to the Financial Statements (continued)

Year ended 31 March 2018

23. SHARE-BASED PAYMENTS (continued)

Employee Share Save Scheme ("SAYE")	2018 No. of options	2018 Weighted average exercise price (£)	2017 No. of options	2017 Weighted average exercise price (£)
Outstanding at beginning of year	223,823	5.36	205,330	4.87
Granted during the year	108,335	6.75	65,374	5.80
Forfeited during the year	(10,506)	5.89	(17,781)	5.07
Exercised during the year	(21,624)	4.43	(29,100)	3.07
Outstanding at the end of the year	300,028	5.91	223,823	5.36
Exercisable at the end of the year	–	–	–	–

Options outstanding at 31 March 2018 had a weighted average contractual life of 2.0 years (2017: 2.1 years).

The inputs into the Black-Scholes model for the options granted during the year are as follows:

	LTIP	SAYE
Expected volatility	n/a	27%
Expected life	3 years	3 years
Risk-free rate	0.1%	0.1%
Expected dividends	4.6%	4.6%

Expected volatility was determined by calculating the historical volatility of the Group's share price over the year prior to grant.

Long Term bonus performance plan

The Executive Directors receive awards under the Long Term Bonus Performance Plan.This is accounted for as an equity instrument.The plan was set up in July 2015. The vesting criteria and scheme mechanics are set out in the Directors' Remuneration Report. At 31 March 2018 the weighted average contractual life was 0.3 years.

24. CAPITAL COMMITMENTS

At 31 March 2018 the Group had £13.7 million of amounts contracted but not provided in respect of the Group's properties (2017: £8.6 million of capital commitments).

25. EVENTS AFTER THE BALANCE SHEET DATE

On 5 April 2018, the Group exchanged contracts to acquire a property in Uxbridge for a new 55,000 sq ft store.

26. CASH FLOW NOTES

a) Reconciliation of profit after tax to cash generated from operations

Note	2018 £000	2017 £000
Profit after tax	133,542	99,511
Taxation	597	272
Share of profit of associates	(1,370)	(1,442)
Investment income	(1,538)	(1,075)
Finance costs	11,975	11,756
Operating profit	143,206	109,022
Gain on the revaluation of investment properties 14a, 15	(71,635)	(43,706)
Gain on part disposal of investment property	(650)	–
Depreciation of plant, equipment and owner-occupied property 14b	729	738
Depreciation of finance lease capital obligations 14a	1,109	1,196
Employee share options 6	2,470	2,324
Cash generated from operations pre working capital movements	75,229	69,574
Increase in inventories	–	(17)
Increase in receivables	(1,352)	(1,456)
Decrease in payables	(420)	(892)
Cash generated from operations	73,457	67,209

b) Reconciliation of net cash flow movement to net debt

Note	2018 £000	2017 £000
Net decrease in cash and cash equivalents in the year Cash flow from (increase)/decrease in debt financing	(53) (25,644)	(10,301) 7,243
Change in net debt resulting from cash flows	(25,697)	(3,058)
Movement in net debt in the year Net debt at the start of the year	(25,697) (298,049)	(3,058) (294,991)
Net debt at the end of the year 18A	(323,746)	(298,049)

Notes to the Financial Statements (continued)

Year ended 31 March 2018

27. RELATED PARTY TRANSACTIONS

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

Transactions with Armadillo Storage Holding Company Limited

As described in note 14, the Group has a 20% interest in Armadillo Storage Holding Company Limited ("Armadillo 1"), and entered into transactions with Armadillo 1 during the period on normal commercial terms as shown in the table below.

Transactions with Armadillo Storage Holding Company 2 Limited

As described in note 14, the Group has a 20% interest in Armadillo Storage Holding Company 2 Limited ("Armadillo 2"), and entered into transactions with Armadillo 2 during the year on normal commercial terms as shown in the table below.

	31 March 2018 £000	31 March 2017 £000
Fees earned from Armadillo 1	705	574
Fees earned from Armadillo 2	270	253
Balance due from Armadillo 1	89	86
Balance due from Armadillo 2	33	48

The remuneration of the Executive and Non-Executive Directors, who are the key management personnel of the Group, is set out below in aggregate. Further information on the remuneration of individual Directors is found in the audited part of the Directors' Remuneration Report on pages 75 to 85.

	31 March 2018 £000	31 March 2017 £000
Short term employee benefits	1,398	1,325
Post-employment benefits	154	151
Share based payments	5,618	1,566
	7,170	3,042

AnyJunk Limited

James Gibson is a Non-Executive Director and shareholder in AnyJunk Limited and Adrian Lee is a shareholder in AnyJunk Limited. During the year AnyJunk Limited provided waste disposal services to the Group on normal commercial terms, amounting to £37,000 (2017: £36,000).

No other related party transactions took place during the years ended 31 March 2018 and 31 March 2017.

Company Balance Sheet

Year ended 31 March 2018

	Note	2018 £000	2017 £000
Non-current assets
Plant, equipment and owner-occupied property	30a	1,815	1,840
Investment in subsidiary companies	30b	20,490	18,020
		22,305	19,860
Current assets
Trade and other receivables	31	470,716	481,294
Derivative financial instruments	33	751	297
Cash and cash equivalents		1	1
		471,468	481,592
Total assets		493,773	501,452
Current liabilities
Trade and other payables	32	(3,539)	(3,137)
		(3,539)	(3,137)
Non-current liabilities
Bank borrowings	33	(173,000)	(143,635)
		(173,000)	(143,635)
Total liabilities		(176,539)	(146,772)
Net assets		317,234	354,680
Equity
Share capital	22	15,857	15,788
Share premium account Reserves	28	46,362 255,015	45,462 293,430
Equity shareholders' funds		317,234	354,680

The Company reported a profitforthe financial year ended 31March 2018 of £5.3 million (2017: loss of £0.3 million).The financial statements were approved by the Board of Directors and authorised for issue on 21 May 2018.They were signed on its behalf by:

James Gibson	John Trotman
Director	Director

Company Registration No. 03625199

Company Statement of Changes in Equity

Year ended 31 March 2018

	Share capital £000	Share premium account £000	Other non- distributable reserve £000	Capital redemption reserve £000	Retained earnings £000	Own shares £000	Total £000
At 1 April 2017	15,788	45,462	74,950	1,795	217,704	(1,019)	354,680
Total comprehensive income for the year	–	–	–	–	5,298	–	5,298
Issue of share capital	69	900	–	–	–	–	969
Dividend	–	–	–	–	(46,183)	–	(46,183)
Credit to equity for equity-settled
share based payments	–	–	–	–	2,470	–	2,470
At 31 March 2018	15,857	46,362	74,950	1,795	179,289	(1,019)	317,234

The Company's share capital is disclosed in note 22.

The own shares balance represents amounts held by the Employee BenefitTrust(see note 22).

Year ended 31 March 2017

	Share capital £000	Share premium account £000	Other non- distributable reserve £000	Capital redemption reserve £000	Retained earnings £000	Own shares £000	Total £000
At 1 April 2016	15,737	45,227	74,950	1,795	256,877	(1,019)	393,567
Total comprehensive loss for the year	–	–	–	–	(339)	–	(339)
Issue of share capital	51	235	–	–	–	–	286
Dividend	–	–	–	–	(41,158)	–	(41,158)
Credit to equity for equity-settled
share based payments	–	–	–	–	2,324	–	2,324
At 31 March 2017	15,788	45,462	74,950	1,795	217,704	(1,019)	354,680

Company Cash Flow Statement

Year ended 31 March 2018

Note	2018 £000	2017 £000
Cash generated by operations 36	10,156	45,862
Interest paid	(3,307)	(3,572)
Interest received	4,646	3,585
Cash flows from operating activities	11,495	45,875
Investing activities
Purchase of non-current assets	(30)	(3)
Cash flows from investing activities	(30)	(3)
Financing activities
Issue of share capital	969	286
Dividends received	5,749	–
Equity dividends paid	(46,183)	(41,158)
Increase/(decrease) in borrowings	28,000	(5,000)
Cash flows from financing activities	(11,465)	(45,872)
Net movement in cash and cash equivalents	–	–
Opening cash and cash equivalents	1	1
Closing cash and cash equivalents	1	1

Notes to the Financial Statements (continued)

Year ended 31 March 2018

28. PROFIT/(LOSS) FOR THE YEAR

As permitted by section 408 of the Companies Act 2006, the statement of comprehensive income of the Company is not presented as part of these financial statements. The profit for the year attributable to equity shareholders dealt with in the financial statements of the Company was £5.3 million (2017: loss of £0.3 million).

29. BASIS OF ACCOUNTING

The separate financial statements ofthe Company are presented as required by the Companies Act 2006. As permitted by that Act,the separate financial statements have been prepared in accordance with International Financial Reporting Standards as endorsed by the EU.

The financial statements have been prepared on the historic cost basis except that derivative financial instruments are stated at fair value.

The Company's principal accounting policies are the same as those applied in the Group financial statements. See note 23 for details of share based payments affecting the Company.

Going concern

See note 2 for the review of going concern for the Group and the Company.

Investment in subsidiaries

These are recognised at cost less provision for any impairment.

IFRIC 11, IFRS 2 Group and Treasury Share Transactions

The Companymakes equity settled share based payments to certain employees of certain subsidiary undertakings. Equity settled share based payments that aremade to the employees ofthe Company's subsidiaries are treated as increases in equity overthe vesting period ofthe award,with a corresponding increase in the Company's investments in subsidiaries, based on an estimate of the number of shares that will eventually vest.This is the only addition to investment in subsidiaries in the current year.The Company does not have any employees.

30. NON-CURRENT ASSETS

a) Plant, equipment and owner occupied property

	Freehold property £000	Leasehold improvements £000	Fixtures, fittings & office equipment £000	Total £000
Cost
At 31 March 2017	2,186	64	30	2,280
Additions	8	–	23	31
At 31 March 2018	2,194	64	53	2,311
Accumulated depreciation
At 31 March 2017	(408)	(20)	(12)	(440)
Charge for the year	(42)	(1)	(13)	(56)
At 31 March 2018	(450)	(21)	(25)	(496)
Net book value
At 31 March 2018	1,744	43	28	1,815
At 31 March 2017	1,778	44	18	1,840

30. NON-CURRENT ASSETS (continued)

b) Investments in subsidiary companies

	Investment in subsidiary undertakings £000
Cost
At 31 March 2017	18,020
Additions	2,470
At 31 March 2018	20,490

The Group subsidiaries are all wholly-owned, the Group holds 100% of the voting power and the companies are incorporated, registered and operate in England and Wales.The registered office of all subsidiaries is 2 The Deans, Bridge Road, Bagshot, Surrey, GU19 5AT.The subsidiaries at 31 March 2018 are listed below:

Name of subsidiary	Principal activity
.Big Yellow Self Storage (GP) Limited	General Partner
.Big Yellow Self Storage Company Limited	Self storage
Big Yellow (Battersea) Limited	Self storage
The Big Yellow Construction Company Limited	Construction management
The Big Yellow Holding Company Limited	Holding Company
Big Yellow Limited Partnership	Self storage
Big Yellow Nominee No. 1 Limited	Dormant
Big Yellow Nominee No. 2 Limited	Dormant
Big Yellow Self Storage (Chester) Limited	Application to strike off
Big Yellow Self Storage Company 1 Limited	Dormant
Big Yellow Self Storage Company 2 Limited	Dormant
Big Yellow Self Storage Company 3 Limited	Dormant
Big Yellow Self Storage Company 4 Limited	Dormant
Big Yellow Self Storage Company 8 Limited	Self storage
Big Yellow Self Storage Company A Limited	Self storage
Big Yellow Self Storage Company M Limited	Self storage
BYRCo Limited	Property management
BYSSCo A Limited	Dormant
BYSSCo Limited	Self storage
Kator Storage Limited	Self storage
The Last Mile Company Limited	Holding Company
Lock & Leave Limited	Self storage
Lock & Leave (Twickenham) Limited	Self storage

In addition the Group has a 100% interest in Pramerica Bell InvestmentTrust Jersey, a trust registered in Jersey.

Audit exemption statement

Foritsmostrecent year end the companies listed belowwere entitled to exemption fromaudit under section 479A ofthe Companies Act 2006 relating to subsidiary companies.The members ofthese companies have notrequired them to obtain an audit oftheirfinancial statements forthe year ended 31 March 2018.

.Big Yellow Self Storage (GP) Limited Big Yellow Self Storage Company 8 Limited The Big Yellow Construction Company Limited BYRCo Limited Big Yellow Holding Company Limited BYSSCo Limited Big Yellow Nominee No. 1 Limited BYSSCo A Limited Big Yellow Nominee No. 2 Limited Kator Storage Limited Big Yellow Self Storage Company 1 Limited The Last Mile Company Limited Big Yellow Self Storage Company 2 Limited Lock & Leave Limited Big Yellow Self Storage Company 3 Limited Lock & Leave (Twickenham) Limited Big Yellow Self Storage Company 4 Limited

Notes to the Financial Statements (continued)

Year ended 31 March 2018

31. TRADE AND OTHER RECEIVABLES

	31 March 2018 £000	31 March 2017 £000
Amounts owed by Group undertakings Prepayments and accrued income	470,597 119	481,188 106
	470,716	481,294

Amounts owed by Group undertakings are unsecured and are repayable on demand.The Company recharges its external interest cost to its subsidiaries.

32. TRADE AND OTHER PAYABLES

	31 March	31 March
	2018	2017
	£000	£000
Current
Other payables	3,247	2,992
Accruals and deferred income	292	145
	3,539	3,137

33. BANK BORROWINGS AND FINANCIAL INSTRUMENTS

Interest rate derivatives

The Company has one interest rate swap in place at the year end; £30 million fixed at 0.4% (excluding the margin on the underlying debt instrument) until October 2021.The floating rate at 31 March 2018 was paying a margin of 1.25% above one month LIBOR, the fixed rate debt was paying a margin of 1.25%.The Group's policy on risk management is set out in the Report on Corporate Governance on page 62 and in note 18.

	31 March 2018 £000	31 March 2017 £000
Bank borrowings Unamortised loan arrangement fees	173,000 –	145,000 (1,365)
	173,000	143,635

Maturity profile of financial liabilities

	2018	2017
	Financial	Financial
	liabilities	liabilities
	£000	£000
Between one and two years	–	–
Between two and five years	173,000	145,000
Gross financial liabilities	173,000	145,000

The fair value of interest rate derivatives at 31March 2018 was an asset of £751,000 (2017: asset of £297,000). See note 18 for detail of the interest rate profile of financial liabilities.

34. FINANCIAL INSTRUMENTS

The disclosure relating to the Company's financial instruments are detailed in note 18 to the Group financial statements.These disclosures are relevant to the Company's bank borrowings and derivative financial instruments. In addition, the Company has trade and other payables of £3,539,000 in the current year (of which the financial liability is £292,000 (2017: £3,137,000, of which the financial liability was £145,000), which are held at amortised cost in the financial statements.

35. RELATED PARTY TRANSACTIONS

Includedwithin these financial statements are amounts owing from Group undertakings of £470,597,000 (2017: £481,188,000), including intercompany interest receivable of £5,101,000 (2017: £3,585,000) and dividends receivable of £5,749,000 (2017: £nil).

36. NOTES TO THE COMPANY CASH FLOW STATEMENT

Reconciliation of profit after tax to cash generated from operations

	2018 £000	2017 £000
Profit/(loss) after tax	5,298	(339)
Investment income	(10,850)	(3,585)
Finance costs	4,647	2,975
Operating profit	(905)	(949)
Depreciation	56	53
Decrease in receivables	10,578	46,831
Decrease in payables	427	(73)
Cash generated from operations	10,156	45,862

37. GLOSSARY

Adjusted eps	Adjusted profit after tax divided by the diluted weighted average number of shares in issue during the period.
Adjusted NAV	EPRA NAV adjusted for an investment property valuation carried out at purchasers' costs of 2.75%.
Adjusted Profit Before Tax	The Company's pre-tax EPRA earnings measure with additional Company adjustments.
Average net achieved rent per sq ft	Storage revenue divided by average occupied space over a defined period.
BREEAM	An environmental rating assessed under the Building Research Establishment's Environmental Assessment Method.
Carbon intensity	Carbon emissions divided by the Group's average occupied space.
Closing net rent per sq ft	Annual storage revenue generated from in-place customers divided by occupied space at the balance sheet date.
Debt	Long-term and short-term borrowings, as detailed in note 19, excluding finance leases and debt issue costs.
Earnings per share (eps)	Profit for the period attributable to equity shareholders divided by the average number of shares in issue during the period.
EBITDA	Earnings before interest, tax, depreciation and amortisation.
EPRA	The European Public Real Estate Association, a real estate industry body.This organisation has issued Best Practice Recommendationswith the intention of improving the transparency, comparability and relevance ofthe published results of listed real estate companies in Europe.
EPRA earnings	The IFRS profit after taxation attributable to shareholders of the Company excluding investment property revaluations, gains/losses on investment property disposals and changes in the fair value of financial instruments.
EPRA earnings per share	EPRA earnings divided by the average number of shares in issue during the period.
EPRA NAV per share	EPRA NAV divided by the diluted number of shares at the period end.
EPRA net asset value	IFRS net assets excluding the mark-to-market on interestrate derivatives effective cash flowas deferred taxation on property valuations where it arises. It is adjusted for the dilutive impact of share options.
EPRA NNNAV	The EPRA NAV adjusted to reflect the fair value of debt and derivatives and to include deferred taxation on revaluations.
Equity	All capital and reserves of the Group attributable to equity holders of the Company.

Notes to the Financial Statements (continued)

Year ended 31 March 2018

37. GLOSSARY (continued)

Gross property assets	The sum of investment property and investment property under construction.
Gross value added	The measure of the value of goods and services produced in an area, industry or sector of an economy.
Income statement	Statement of Comprehensive Income.
Interest cover	The ratio of operating cash flowexcludingworking capital movements divided by interest paid (before exceptional finance costs, capitalised interest and changes in fair value of interest rate derivatives).This metric is provided to give readers a clear view of the Group's financial position.
Like-for-like occupancy	Excludes the closing occupancy of new stores acquired or opened in the current period.
Like-for-like revenue	Excludes the impact of newstores acquired or opened in the current or preceding financial yearin both the current year and comparative figures. This excludes Nine Elms and Twickenham 2 (both acquired in April 2016) and Guildford Central(opened in March 2018).
LTV (loan to value)	Net debt expressed as a percentage of the external valuation of the Group's investment properties.
Maximum lettable area (MLA)	The total square foot(sq ft) available to rent to customers.
Move-ins	The number of customers taking a storage room in the defined period.
Move-outs	The number of customers vacating a storage room in the defined period.
NAV	Net asset value.
Net debt	Gross borrowings less cash and cash equivalents.
Net initial yield	The forthcoming year's net operating income expressed as a percentage of capital value, after adding notional purchaser's costs.
Net promoter score (NPS)	The Net Promoter Score is an index ranging from -100 to 100 that measures the willingness of customers to recommend a company's products or services to others.The Company measures NPS based on surveys sent to all of its move-ins and move-outs.
Net rent per sq ft	Storage revenue generated from in place customers divided by occupancy.
Occupancy	The space occupied by customers divided by the MLA expressed as a %.
Occupied space	The space occupied by customers in sq ft.
Pipeline	The Group's development sites.
Property Income Distribution (PID)	A dividend, generally subject to withholding tax, that a UK REIT is required to pay from its tax exempt property rental business and which is taxable for UK-resident shareholders at their marginal tax rate.
REIT	Real Estate InvestmentTrust. A tax regime which in the UK exempts participants from corporation tax both on UK rental income and gains arising on UK investment property sales, subject to certain conditions.
REVPAF	Total store revenue divided by the average maximum lettable area in the year.
Store EBITDA	Store earnings before interest, tax, depreciation and amortisation.
Total shareholder return (TSR)	The growth in value of a shareholding over a specified period, assuming dividends are reinvested to purchase additional units of shares.

Ten Year Summary

Year ended 31 March 2018

Results	2018 £000	2017 £000	2016 £000	2015 £000	2014 £000	2013 £000	2012 £000	2011 £000	2010 £000	2009 £000
Revenue	116,660	109,070	101,382	84,276	72,196	69,671	65,663	61,885	57,995	58,487
Operating profit before gains and losses on property assets	70,921	65,316	59,854	48,420	39,537	37,454	35,079	32,058	29,068	30,946
Cash flow from operating activities	62,977	55,974	55,467	42,397	32,752	30,186	27,388	23,534	19,063	10,203
Profit/(loss) before taxation	134,139	99,783	112,246	105,236	59,848	31,876	(35,551)	6,901	10,209	(71,489)
Adjusted profit before taxation	61,422	54,641	48,952	39,405	29,221	25,471	23,643	20,207	16,514	13,791
Net assets	981,148	890,350	829,387	750,914	594,064	552,628	494,500	544,949	547,285	502,317
EPRA earnings per share Declared total dividend per share	38.5p 30.8p	34.5p 27.6p	31.1p 24.9p	27.1p 21.7p	20.5p 16.4p	19.3p 11.0p	18.2p 10.0p	15.5p 9.0p	13.0p 4.0p	11.9p 0p
Key statistics Number of stores open Sq ft occupied (000) Occupancy increase in year 000 sq ft)* Number of customers Average number of employees during	74 3,730 179 55,000	73 3,551 188 52,500	71 3,363 185 50,000	69 3,178 346 47,250	66 2,832 200 41,800	66 2,632 174 38,500	65 2,458 328 36,300	62 2,130 215 32,800	60 1,915 140 30,500	54 1,775 (75) 28,500
the year	335	329	318	300	289	286	279	273	252	239

* The occupancy growth in 2015 and 2017 includes the acquisition of existing stores

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Pureprint Ltd is FSC certified, PEFC certified and ISO 14001 certified showing that it is committed to all round excellence and improving environmental performance is an important part of this strategy. We aim to reduce at source the effect our operations have on the environment, and are committed to continual improvement, prevention of pollution and compliance with any legislation or industry standards.

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bigyellow.co.uk

Big Yellow Group PLC

2 The Deans, Bridge Road, Bagshot, Surrey GU19 5AT

Tel: 01276 470190 Fax: 01276 470191 e-mail: info@bigyellow.co.uk