News & Media

Trading Update February 2017

08.02.2017

Assura plc

Trading Update

For the third quarter to 31 December 2016

Assura plc (“Assura”), the UK’s leading primary care property investor and developer, today publishes a trading update for the third quarter to 31 December 2016.

 Value enhancing investment activity

Assura continued to make good progress in the third quarter, completing the acquisition of 22 medical centres for a gross consideration of £48.8 million with a passing rent roll of £2.5 million and a weighted average unexpired lease length of 13.8 years.

Assura has a further pipeline of individual asset acquisitions and developments currently in solicitors’ hands worth approximately £103 million.

Rental income increased

Assura now owns 385 medical centres with a total annualised rent roll of £72.7 million (30 September 2016: £70.1 million), with growth in the financial year to date driven primarily by acquisitions.

The weighted average annual rent increase was 1.72% on the basis of 84 reviews settled in the nine months to 31 December 2016, of which open market rent reviews were 1.15%.

Secure and growing dividend

A key part of Assura’s strategy is providing a secure, fully covered and growing dividend stream for investors.  The quarterly dividend was increased by 9% for the January 2017 payment to 0.6 pence per share equivalent to 2.4 pence per share on an annualised basis.

Strong financing and debt position

As highlighted in the interim results, in October Assura issued £100 million of unsecured ten-year notes at a fixed rate of 2.65%. This was Assura’s first issue in the US private placement market and demonstrates the Company’s ability to attract a new source of long-term funding at an attractive rate. This unsecured funding increases operational flexibility and reduces transaction costs associated with financing the expanding property portfolio.

At 31 December 2016 Assura’s undrawn facilities were £130 million.

Market Background

The NHS has identified over 200 new build primary care schemes for investment under the Estates and Technology Transformation Fund (“ETTF”) as part of its plans to support the increase in services available in the primary care setting.   This investment will be a very positive step as the NHS looks to relieve the pressures in the secondary care healthcare system, although the timescale is uncertain and the funding announced to date is insufficient for full implementation of all of the schemes identified.

Jonathan Murphy, Interim CEO, commented:

“Assura made good progress in the third quarter, completing further investment activity and delivering improved primary care space into the market. The long-term solution to the challenges facing the NHS is widely agreed to include more healthcare being provided in the primary care sector, by GPs. This in turn will require investment in GP premises. We are pleased that the Government has shown its support for this by the ETTF. Firm timetables and funding to turn these plans into reality are now essential if the benefits to the NHS are to be achieved within the five-year timeframe of the GP Forward View.”

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For more information, please contact:

 Assura plc  Tel: 01925 420660
Jonathan Murphy
 Finsbury  Tel: 0207 251 3801
Gordon Simpson