Financial and operational gains with improved rent cover
Impact Healthcare REIT plc (ticker: IHR), the real estate investment trust which gives investors exposure to a diversified portfolio of UK healthcare real estate assets, with a focus on care homes, today announces the Company’s annual results for the year ended 31 December 2023.
Summary of 2023
Our tenants continued to improve their performance with higher care home occupancy and increased fees to residents, as inflation peaked in the year. Our rent increases are largely capped at 4%, so this helps tenants’ rent cover, and makes our income more secure. Boosted by an acquisition, our total rent roll grew strongly, and this has flowed through to both earnings and dividend growth.
Statutory profit before tax was up by 189% over the previous year, but this is flattered by revaluation movements. Adjusted earnings per share gives the best view of underlying performance, and it grew by 2.4%. We therefore met our dividend target, whilst still 108% covered by adjusted earnings.
Rental growth from the inflation-linkage in all of our leases drove up the value of our property investments by 4.1% on a like-for-like basis. This in turn grew NAV per share by 4.7% to 115.38 pence. Including the benefit of our dividend meant that total accounting return was 10.8% for the year.
Our dividend target for 2024 is 6.95 pence¹, up 2.7% on 2023.
Strategic Priorities
These are our strategic priorities, with an update on how they have fared in 2023:
Our strategic priorities are supported by our balance sheet with low gearing. We have £250 million of committed debt facilities and a weighted average term of 6.3 years. Drawn debt was £184.8 million at a 4.56% average cost, and 95% of our drawn debt facilities are fixed or hedged against interest rate rises. At the year-end our EPRA (net) LTV was 27.8%.
Simon Laffin, Chair, commented;
“Our aim is to work with our tenants to provide quality, affordable and sustainable care homes. The country needs a thriving and growing care home sector. The private sector can play an even more significant role in providing care for elderly people and helping the NHS, deploying capital and resources to enhance and grow affordable care home provision. By offering more step-down, nursing and residential care for elderly people, the sector has the medium-term potential to take tens of thousands of patients out of hospital beds: freeing up NHS resources and reducing costs.
As the economy recovers from 2023’s high inflation and interest rate rises, and as government begins to recognise the larger role that this sector can play in the health infrastructure we believe that there will be opportunities for Impact. We are well positioned to play a larger role in helping both residents and the NHS, whilst delivering long-term sustainable returns to shareholders.”
Financial Highlights
FOR THE FULL RESULTS, PLEASE SEE THE ATTACHED PDF
ANNUAL RESULTS PRESENTATION
A Company presentation for analysts and investors will take place today at 8.30am (UK) via an in-person meeting and a live webcast and conference call.
To attend the in-person presentation, please contact:
impacthealth-maitland@h-advisors.global
To view the live webcast, please register in advance at:
https://stream.brrmedia.co.uk/broadcast/65e9a4042cbb0478a930d370
The conference call dial-in is available using the below details:
Phone number: +44 (0) 33 0551 0200
Participant access quote: Impact Healthcare – Full Year Results
If you would like to ask your questions verbally, please use the dial in number. Alternatively, you can type questions into the webcast question box.
The presentation will also be accessible on demand later in the day on the Company’s website: www.impactreit.uk
ANNUAL REPORT
We have completely redesigned the Annual Report this year to make it more concise with less duplication, while making the key elements of the Company’s strategy and its performance clearer. It can be accessed here http://www.rns-pdf.londonstockexchange.com/rns/0574I_1-2024-3-24.pdf
A copy of the Annual Report is also available on the Company’s website at https://www.impactreit.uk/investors/reporting-centre/reports/. The Annual Report has also been submitted to the National Storage Mechanism and will shortly be available at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
2024 NOTICE OF ANNUAL GENERAL MEETING
The 2024 Notice of Annual General Meeting is now available to view on the Company’s website at https://www.impactreit.uk/investors/reporting-centre/. The Company’s Annual General Meeting will be held at 9:00 a.m. on Tuesday, 21 May 2024, at the offices of Travers Smith LLP, 10 Snow Hill, London EC1A 2AL.
The formal Notice of the Annual General Meeting will be posted to those shareholders who have requested that the Company should continue with postal correspondence and in accordance with Listing Rule 9.6.1 has been submitted to the Financial Conduct Authority and will shortly be available for inspection from the National Storage Mechanism at https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
The Board encourages Shareholders to vote on any of the matters of business at the AGM in advance by proxy.
FOR FURTHER INFORMATION, PLEASE CONTACT:
Impact Health Partners LLP via Maitland/AMO
Andrew Cowley
David Yaldron
Jefferies International Limited
Tom Yeadon, tyeadon@jefferies.com
Ollie Nott, onott@jefferies.com
Tel: +4420 7029 8000
Winterflood Securities Limited
Neil Langford, neil.langford@winterflood.com
Joe Winkley, joe.winkley@winterflood.com
Tel: +4420 3100 0000
H/Advisors Maitland (Communications Adviser)
James Benjamin, impacthealth-maitland@maitland.co.uk
Rachel Cohen
Tel: +44 7747 113 930
The Company’s LEI is 213800AX3FHPMJL4IJ53.
Further information on Impact Healthcare REIT is available at www.impactreit.uk.