PHP forecasts ‘firmer’ rental growth as profit rises

Primary Health Properties has posted an upbeat outlook on rental growth and underlined “robust” investment appetite for health facilities, with more yield compression on the cards. The value of the REIT’s portfolio grew by 1.8% to £2.9bn during the six months ending 30 June, across 524 health facilities. It generated a 4.6% net initial yield, narrowing slightly from the same period last year. IFRS profit increased to £107.1m year-on-year, up from £71.4m. Net rental income rose by 5% to £71.1m. Adjusted NTA per share stood at 120.8p, up 3.5% on H1 last year. LTV inched up to 43.1%, from 42.9% recorded at the end of December last year. Harry Hyman, chief executive of PHP, said: “We are encouraged by the firmer tone of rental growth experienced in the period from the ongoing rent reviews and asset management projects successfully completed. “Furthermore, with the majority of PHP’s debt either fixed or hedged for a weighted average period of just under eight years the board remains confident that PHP can continue to deliver further earnings and dividend growth. “Notwithstanding the outlook for longer-dated interest rates the investment market has remained robust in the first half of the year and we have continued to see further net initial yield compression in both the UK and Ireland.” To send feedback, e-mail pui-guan.man@eg.co.uk or tweet @PuiGuanM or @EGPropertyNews Photo: Martin Lee/Shutterstock