Takeover Looms as Abacus Storage King Doubles Profit and Expands Portfolio

Solid Financial Performance

Abacus Storage King (ASK) has delivered a standout financial year ending June 2025, posting a statutory net profit of $289 million, more than doubling its FY24 result by $150.8 million. This impressive growth was underpinned by a 4.7% increase in Funds from Operations (FFO) to $85 million and a modest rise in FFO per security to 6.47 cents. The company maintained its distribution guidance at 6.2 cents per security, reflecting confidence in its recurring income streams.

Operational Strength and Portfolio Expansion

ASK’s established portfolio showed broad-based growth across all Australian regions, with Western Australia and Victoria leading revenue per available metre (RevPAM) gains. Occupancy rates improved to 91.2%, driven by strong performances in New South Wales and the Australian Capital Territory. The company invested $84 million acquiring six operating stores and four development sites, adding nearly 20,000 square metres of net lettable area (NLA). Additionally, three new stores were developed, further expanding the portfolio by 20,700 square metres.

Capital Management and Sustainability Initiatives

ASK’s balance sheet remains robust, with gearing at 29.3% comfortably within its 25%-40% target range, and a significant funding capacity exceeding $600 million. The average cost of debt fell to 3.4%, with no debt maturing in FY26, providing financial flexibility. On the sustainability front, the company advanced its net zero emissions goal for 2030 by reducing greenhouse gas emissions by 3% and installing solar panels at 12 additional stores, bringing the total to 88 solar-equipped sites.

Takeover Proposal Update

ASK remains in a holding pattern regarding a potential acquisition. After rejecting an initial $1.47 per security offer from a consortium led by Ki Corporation and Public Storage, the company is now engaged in due diligence following a revised $1.65 per security non-binding proposal. The outcome of this process will be closely watched by investors, as it could significantly impact ASK’s strategic direction and shareholder value.

Looking Ahead

With FY26 distribution guidance steady at 6.2 cents per security and a payout target of 90-100% of FFO, ASK is positioning itself for continued growth through strategic acquisitions, developments, and operational excellence. The company’s investment in technology and data management platforms is expected to enhance margins and competitive positioning over time, while its sustainability commitments align with broader market expectations.