Thursday 10 November 2016 02:08 PM
Vital Healthcare prepared for growth after successful capital raise
By Sophie Boot
Nov. 10 (BusinessDesk) - Vital Healthcare Property Trust, the Auckland-based hospital and healthcare property developer and investor which raised $160 million in July to help fund its growth strategy, says it's in a strong position for growth following its $160 million capital raising in July.
At the annual meeting in Auckland this morning, Vital's chief executive David Carr said the company's portfolio was in its "strongest ever position", having expanded into Western Australia and South Australia this year, according to speech notes posted to the NZX.
In August, Vital reported a 21 percent gain in full-year profit to $117 million in the year ended June 30, with net property income up 15 percent to $68 million while the trust recognised a $102 million revaluation gain on investment property following an $84 million gain a year earlier. At the time, it flagged A$83 million of new brownfield development projects across its Australian private hospital portfolio and said it was targeting A$20 million of strategic acquisitions.
Today, Vital said it has A$77.9 million in six current developments across Australia, with five of those in New South Wales and one in South Australia. It's also recently bought residential aged care properties in WA and NSW for A$444 million along with Boulcott Private Hospital in Lower Hutt in Wellington for NZ$30.7 million and a medical office building in Sydney for A$30.7 million.
"Aged care real estate continues to form part of our diversification strategy," Carr said. "The aged care sector remains large and fragmented and is moving into a consolidation and growth phase that will ultimately require significant investment."
The company has a market-leading weighted average lease term to expiry (WALE) ratio in Australasia, Carr said, at 18.4 years as of September, compared to what he said was a 5.5 year sector average.
Chairman Graeme Horsley said since the capital raise and recently announced acquisitions, the company's gearing sat at around 24 percent.
"This provides ample capacity to keep delivering on our brownfield development programme and any potential acquisition opportunities as they arise."
The company today said unitholders will get a first quarter distribution of 2.125 cents per unit with 0.1320 of imputation credits, payable on Dec. 19, with a Dec. 5 record date.
"Vital’s Distribution Reinvestment Plan (DRP) will remain available to investors for this distribution, with a 1 percent discount being applied when determining the strike price," the company said.
The units last traded at $2.05 and have climbed 11 percent this year.