22 November 2022
Assura plc
Delivering continued growth
Assura plc (“Assura”), the leading primary care property investor and developer, today announces its results for the six months ended 30 September 2022.
Jonathan Murphy, CEO, said:
“This has been another period of strong performance for Assura. Further enhancements to our high-quality portfolio and good progress against our strategic priorities have resulted in an increase of 15% in net rental income and 13% growth in EPRA EPS.
“We have a strong balance sheet – characterised by long-term fixed rate debt at a weighted average rate of 2.3%. Given the current macro-economic uncertainty, we will proceed cautiously with deploying capital in the short term and continue to carefully manage our operating costs.
“More broadly, we see growing and consistent demand for high-quality community healthcare buildings that is not linked to the economic cycle. The need to invest in primary care has widespread cross-party political support – given it is cheaper for the NHS to deliver services in this setting and as pressure on hospital resources becomes increasingly unsustainable.
“Looking ahead, our proven strategy, specialist expertise, track record of delivery and a predictable, growing income stream – the majority underpinned by the NHS – means we are well placed to continue delivering attractive returns for shareholders over the long term.”
Sustained strong growth across portfolio, EPRA earnings and dividend
| · | Passing rent roll increased 3% to £139.3 million (March 2022: £135.7 million) with WAULT of 11.5 years |
| · | Net rental income up 15% to £70.0 million (2021: £61.1 million) |
| · | Portfolio value rose 5% to £2,879 million (March 2022: £2,752 million), Net Initial Yield (“NIY”) widened 4 basis points to 4.52% (March 2022: 4.48%) |
| · | IFRS profit before tax £30.9 million (2021: £69.3 million) and EPS 1.0p (2021: 2.6p), reflecting negative valuation movement in the period |
| · | EPRA earnings up 20% to £49.0 million (2021: £40.9 million) and EPRA EPS of 1.7p (2021: 1.5p) |
| · | Quarterly dividend increased 5% to 0.78p (March 2022: 0.74p) |
Continued track record of disciplined investment and proactive capital recycling
| · | Portfolio of 603 high-quality primary care properties serving 6.5 million people across the UK |
| · | Invested £141 million on additions (yield on cost 5.0%, WAULT 12 years): six development completions, 13 acquisitions and three assets in co-investment arrangements |
| · | Five asset enhancement capital projects completed (total spend £2.2 million) and on site with a further six (total spend £8.9 million) |
| · | Completed disposal of portfolio of 61 properties for £73 million as small premium to book value |
| · | Lease re-gears completed on £1.1 million existing rent roll with further £6.4 million in the pipeline |
| · | Rent reviews generated weighted average annual rent increase of 4.5%1 (absolute increase of 7.7% on rent roll reviewed) |
| · | Total contracted rental income stands at £1.77 billion (March 2022: £1.81 billion) |
Pipeline opportunities attractive, but more moderate investment activity expected in the short term
| · | Currently on site with 13 developments; total cost of £154 million (March 2022: 17, £166 million) of which £65 million has been spent to date |
| · | Immediate development pipeline of 10 schemes (total cost £83 million), where we would normally expect to be on site within 12 months notwithstanding delays currently being experienced in construction timetables and start dates |
| · | Pipeline of 18 asset enhancement capital projects (projected spend £10.5 million) over the next two years |
| · | Limited acquisitions expected in the second half given the current macro-economic backdrop |
We Build for Health; sustainability and social impact at the heart of all decision-making
| · | Moved on site with our first net zero carbon development at Fareham, Portsmouth |
| · | All development completions rated BREEAM Very Good or Excellent and EPC B and above |
| · | Assura Community Fund has deployed over £1.3 million since 2020 to community-health related projects |
| · | Targeting net zero carbon across our portfolio by 2040; currently completing net zero carbon building audits across a cross-section of portfolio |
| · | On track for EPC B ratings across our portfolio by March 2026, currently 47% at required level |
Strong and sustainable financial position
| · | LTV of 38%, net debt of £1,092 million on a fully unsecured basis with weighted average debt maturity of 7.5 years |
| · | All drawn debt on fixed rate basis with weighted average interest rate maintained at 2.30% (March 2022: 2.30%) |
| · | Cash and undrawn facilities of £284 million |
| · | A- (stable outlook) rating from Fitch Ratings Ltd reaffirmed in January 2022 |
Summary results
| Financial performance | S eptember 2022 | September 2021 | Change |
| Net rental income | £70.0m | £61.1m | 14.6% |
| I FRS profit before tax | £30.9m | £69.3m | (55.4)% |
| IFRS earnings per share | 1.0p | 2.6p | (61.5)% |
| EPRA earnings per share | 1.7p | 1.5p | 13.3% |
| Dividend per share | 1.52p | 1.45p | 4.8% |
| Property valuation and performance | September 2022 | March 2022 | Change |
| Investment property | £2,879m | £2,752m | 4.6% |
| Diluted EPRA NTA per share | 60.2p | 60.7p | (0.8)% |
| Rent roll | £139.3m | £135.7m | 2.7% |
| Financing | September 2022 | March 2022 | Change |
| Loan to Value (“LTV”) ratio | 38% | 36% | 2ppt |
| Undrawn facilities and cash | £284m | £369m | (23.0)% |
| Weighted average cost of debt | 2.30% | 2.30% | No change |
1 Weighted average annual uplift on all settled reviews
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 plcJayne Cottam, CFODavid Purcell, Investor Relations Director | Tel: 01925 945354Email: Investor@assura.co.uk |
| FGS GlobalGordon SimpsonJames Thompson | Tel: 0207 251 3801Email: Assura@fgsglobal.com |
A presentation for investors and analysts, followed by live Q&A, will be streamed at the link below on 22 November 2022 at 9.00am GMT.
Webcast link: https://stream.brrmedia.co.uk/broadcast/63467a6c9c85f23078e14e3a