Interim results 2020 - statement

Creating outstanding spaces for health services in our communities

Assura plc ("Assura"), the leading primary care property investor and developer, today announces its interim results for the six months to 30 September 2020.

Jonathan Murphy, CEO, said: 

“The first six months of the year was a period of significant activity across the Group, reflecting Assura’s ongoing resilience and strong market positioning. In April, we raised £185 million from our shareholders, and since then we have been deploying that capital on a number of exciting opportunities to strengthen our portfolio. In the half year, we have delivered ahead of expectations. We made strong progress with developments, completing six schemes with a further 15 on site, and replenishing the pipeline. In addition, we closed 20 acquisitions, the pipeline is another £90 million and our asset enhancement activities continue to generate value. 

“Assura’s predictable business model was again demonstrated by consistent rent collection, with our portfolio of 576 properties achieving a passing rent roll up 4% to £113.3 million in the first half. We made a strong start with our social impact strategy, SixBySix, including the launch with an initial £2.5 million contribution to the Assura Community Fund. In September, we also successfully raised £300 million through our first social bond. 

“Assura’s delivery of ongoing growth during these unprecedented times means we are best-placed to support both the immediate and long-term interests of the NHS, which has been under exceptional pressure over the last six months. As we move into the winter season, we are engaging very closely to ensure we continue to support local NHS systems, the clinicians and patients using our buildings, and the communities which our buildings serve, however we can.”

Portfolio of scale well set to continue providing stable, long-term cash flows

• Strong portfolio of 576 properties with passing rent roll up 4% to £113.3 million (March 2020: £108.9 million) and WAULT of 11.9 years (March 2020: 11.7 years)
• Profit before tax up 20% to £43.8 million (2019: £36.4 million), reflecting higher net rental income following portfolio additions and positive valuation movement and after £2.5 million donation to the Assura Community

Fund

• Adjusted EPRA earnings increase by 9% to £35.8 million, adjusted EPRA EPS of 1.4 pence per share (2019: £32.9 million, 1.4 pence per share)
• Portfolio is up 6% to £2,259 million as at 30 September 2020 (March 2020: £2,139 million).
• Portfolio Net Initial Yield (“NIY”) at 4.68% (March 2020: 4.68%)
• Current quarterly dividend of 0.71 pence per share

Investment activity delivers growth and replenished pipelines

• Maintained strong progress with developments: six schemes completed in six months (four in previous year), a further 15 on site at a total cost of £77 million
• Completed 20 acquisitions for consideration of £80 million; 26 disposals with proceeds of £23 million
• Asset enhancement delivering growth: one project completed, three more on site; 13 lease re-gears (£1.1 million existing rent roll) and 129 rent reviews completed (1.2% uplift on OMR reviews)
• Total contracted rental income increased to £1.47 billion (March 2020: £1.43 billion)
• Pipelines: immediate developments totalling £65 million; acquisitions at £90 million in legal hands; asset enhancement capital projects of £14 million
• 42 lease re-gears covering £5.5 million of existing rent roll in the current pipeline

Social impact strategy at the heart of our business model

• We continue to work closely with the NHS and our GP tenants to support the service through the crisis, including utilising vacant space for the NHS and supporting occupiers’ needs with our premises
• Made good initial steps toward our newly launched SixbySix ambition – that by 2026 six million people will have benefitted from improvements to and through our healthcare buildings, maximising our contribution to society and minimising our impact on the environment – as part of our plan to become the UK’s leading listed property business for long-term social impact
• Assura Community Fund launched with an initial contribution of £2.5 million to support health-improving projects in the communities around our buildings, furthering our support for charity partners in place before COVID-19 

Strong financial position boosted by Social Bond

• As at 30 September 2020 gross debt stood at £1,067 million with undrawn facilities of £300 million and cash of £310 million
• Gross proceeds of £185 million from equity raise in April 2020
• £300 million 10-year Social Bond launched in September 2020 at a coupon of 1.5%
• LTV of 33% at 30 September 2020 and weighted average interest rate of 2.68%
• Subsequent to the period end, in October 2020 Assura exercised option to reduce the RCF to £225 million and to repay the £110 million 4.75% unsecured bond due 2021

Summary results

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.