14 November 2024
Assura plc
Interim results: Significant strategic progress in first half of year
Assura plc (“Assura”), the UK’s leading diversified healthcare REIT, today announces its interim results for the six months ended 30 September 2024.
Jonathan Murphy, CEO, said:
“The first half of this financial year has been transformative for Assura. We delivered significant strategic progress to position us firmly as the UK’s leading diversified healthcare REIT offering an attractive investment opportunity into favourable long-term healthcare trends. We completed two strategically important transactions, diversifying our funding sources and materially increasing our presence in the structurally supported growth market of private healthcare, to lay the foundations for Assura’s long-term future. We’re also delighted to have been certified as the first FTSE 250 B Corp, an achievement which validates our continued focus on prioritising the positive impact we have on all our stakeholders.
“Assura has a proven track record of delivering earnings and dividend growth, and this period has been no exception with a 4% uplift in EPRA earnings and an increased dividend for the 11th consecutive year. At the same time, we have made good progress in our disposals programme post-period to reduce our leverage over the short-term with 12 assets sold for £25 million last month.
“Long-term trends in the UK healthcare market offer considerable growth drivers for Assura owing to the national recognition of a need to shift care into the community; increased focus on preventative services; and the increasing uptake of private healthcare amongst patients. An ageing population, pressure on NHS waiting lists and a forecast demand for beds that the NHS is unlikely to meet all underscore the critical role that Assura’s assets – across both primary care and private health – can play in supporting the structural change that is required.
“The diverse healthcare markets in which Assura operates benefit from long-term, secure and growing income supported by strong underlying demand. With our full suite of property capabilities, strength of our long-term relationships and embedded ESG strategy, Assura is well-placed to take full advantage of these opportunities as the clear leader in our chosen sector.”
A diversified healthcare REIT delivering strong and growing cash flows
· Passing rent roll increased 19% to £179.1 million (March 2024: £150.6 million) with WAULT of 13.1 years (March 2024: 10.8 years)
· Net rental income up 8% to £76.7 million (September 2023: £70.8 million)
· Investment property value £3.1 billion (March 2024: £2.7 billion); valuation uplift of £25.4 million in half year
· Net Initial Yield 5.20% (March 2024: 5.17%)
· EPRA earnings up 4% to £52.7 million (September 2023: £50.8 million); EPRA EPS of 1.7p (September 2023: 1.7p)
· IFRS profit before tax £77.1 million (September 2023: loss of £17.8 million) and EPS 2.5p (September 2023: (0.6)p)
· Increase in EPRA NTA to 49.4p (March 2024: 49.3p); valuation gain in the period more than offset the dilution from shares issued
· 2.4% increase in the quarterly dividend to 0.84 pence per share (3.36 pence on an annual basis) with effect from the July 2024 payment
Delivering against our strategic objectives to answer long-term demand for healthcare capacity
· Portfolio of 14 private hospitals acquired for £500 million: day 1 rental income of £29.4 million, WAULT of 26 years, 100% subject to annual index-linked rent reviews, let to tier 1 private healthcare providers with strong rent cover of 2.3 times
· Announced £250m joint venture with USS to support growth and provide a new source of funding
· Certified as first FTSE 250 B Corp recognising our high standards of social and environmental performance
· Three developments completed with a total combined spend of £46 million adding £1.9 million to rent roll
· 8.2% uplift (£1.7 million, 3.0% on an annualised basis1) on previous passing from rent reviews settled, covering £20.4 million of existing rent
· Seven lease regears and seven asset enhancement capital projects (total spend £3.0 million) completed; on site with a further four capital projects (total spend £5.6 million)
Continued focus on capital recycling
· Targeting net debt to EBITDA below 9 times and LTV below 45% through capital recycling over the next 18 – 24 months
· Strong early progress, with 12 assets sold for £25 million in October 2024 (in line with book value)
· Completed transfer of seven assets2 to the USS joint venture raising £85 million
· Active discussions currently progressing on asset disposals of £110 million, and a further £90 million pipeline has been identified for possible disposal
Pipeline of opportunities for strategic expansion and further growth
· On site with five developments; total cost of £44 million with £27 million remaining to be spent
· Extended development pipeline totalling £447 million; including 33 GP centres, 2 private hospitals and 7 schemes in Ireland
· Pipeline of 14 capital asset enhancement projects (projected spend £8.8 million) over the next two years
· 32 lease re-gears covering £3.9 million of existing rent roll in the current pipeline
Strong and sustainable financial position
· Weighted average interest rate at 3.0% (March 2024: 2.3%); all long-term drawn debt on fixed rate basis
· Weighted average debt maturity of 5.1 years, limited refinancing over the next 3 years. Over 40% of drawn debt matures beyond 2030, with our longest maturity debt at our lowest rates
· Credit rating reaffirmed by Fitch in August following private hospital portfolio acquisition
· Net debt of £1,575 million (March 2024: £1,217 million) on a fully unsecured basis with cash and undrawn facilities of £143 million
· Proceeds of disposals will be used to repay revolving credit facility (which is variable rate linked to SONIA)
Assura is pleased to confirm that the Johannesburg Stock Exchange (“JSE”) has granted approval to Assura for a secondary listing on the Main Board of the JSE. The commencement of trading is expected to take effect on Thursday, 21 November 2024. Assura continues to see opportunities in providing critical healthcare infrastructure and believes that this secondary listing will provide a new potential pool of capital to fund the Assura’s continued growth. For further details, please see the confirmation of secondary listing announcement released.
Summary results
| Financial performance | September 2024 | September 2023 | Change |
| Net rental income | £76.7m | £70.8m | 8.3% |
| IFRS profit/(loss) before tax | £77.1m | £(17.8)m | |
| IFRS earnings/(loss) per share | 2.5p | (0.6)p | |
| EPRA earnings per share | 1.72p | 1.71p | |
| Dividend per share | 1.66p | 1.6p | 3.7% |
| Property valuation and performance | September 2024 | March 2024 | Change |
| Investment property | £3,115m | £2,708m | 15.0% |
| Diluted EPRA NTA per share | 49.4p | 49.3p | 0.2% |
| Rent roll | £179.1m | £150.6m | 18.9% |
| Financing | September 2024 | March 2024 | Change |
| Net debt to EBITDA | 9.7x | 9.4x | |
| Undrawn facilities and cash | £143m | £235m | |
| Weighted average cost of debt | 3.0% | 2.3% | 70bps |
1 Weighted average annual uplift on all settled reviews
2 Five completed in the first half and the remaining two in November
Alternative Performance Measures (“APMs”)
The highlights page and summary results table above include a number of financial measures to describe the financial performance of the Group, some of which are considered APMs as they are not defined under IFRS. Further details are provided in the CFO Review, notes to the accounts and glossary.
For further information, please contact:
| Assura plc Jayne Cottam, CFO David Purcell, Investor Relations Director | Tel: 0161 515 2043 Email: investor@assura.co.uk |
| FGS GlobalGordon Simpson Grace Whelan | Tel: 0207 251 3801 Email: assura@fgsglobal.com |