Primary Health Properties : Financial Document

Primary Health Properties PLC

Annual Results Presentation 2022

DELIVERING LONG TERM SUSTAINABLE INCOME

AGENDA

KEY HIGHLIGHTS DIVIDEND TRACK RECORD STRONG RELATIVE PERFORMANCE FINANCIAL REVIEW

PROPERTY REVIEW PIPELINE AND OUTLOOK APPENDICES

Primary Health Properties PLC Annual Results Presentation 2022

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KEY HIGHLIGHTS

RECORD YEAR FOR RENTAL

GROWTH DRIVING

PERFORMANCE

Primary Health Properties PLC Annual Results Presentation 2022

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(2021: 100%)

2022 KEY HIGHLIGHTS

Security and longevity of our income drives our progressive dividend policy

Long-term demographic, macro and political trends supportive across UK and Ireland

• Populations are growing, ageing and suffering more instances of chronic illness
• Increasing patient demand for services affecting service provision, patient care and outcomes
• Obsolete estate (c.40%) and COVID-19 added to increasing strain being put on healthcare systems
• NHS strategic move of transferring services away from hospital settings to modern primary care premises
• Impact of digital being outweighed by increasing demand for services (consultations back to 70% F2F post C-19)

Disciplined approach to shareholder returns and capital deployment

• Entering 27th year of consecutive dividend growth: 6.7p per share +3.1% (2022: 6.5p +4.8%)
• Dividend cover at 102% (2021: 101%)
• Total property return +2.8% (2021: +9.5%); valuation declines partially offset by firmer rental growth
• Strategic acquisition of Axis, post period end, gives permanent presence in Ireland to source new opportunities
• Limited development exposure and future investment only if accretive to earnings
• Disciplined pipeline, focused on Ireland, across investment, development and asset management opportunities
• Disposal of 13 smaller assets for £27.7m, 13% above Dec.21 book values representing 60bps of yield compression
  Focus on income growth
• Firmer tone of rental growth, limited exposure to rising interest rates and strong control on costs
• L4L rental growth in 2022: £3.3m +2.4% (2021: £2.4m +1.8%)
• Refinancing's in 2021 and early part of 2022 delivering significant interest cost savings

Entering 27th year of consecutive dividend growth

Portfolio

£2.8 billion (2021: £2.8 billion)

Rent roll

£145 million (2021: £141 million)

Government backed income

89% (2021: 90%)

Index linked income

25% (2021: 25%)

Occupancy

99.7% (2021: 99.7%)

WAULT

11.0 years (2021: 11.6 years)

Net debt: fixed or hedged 94%

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ENTERING 27TH YEAR OF CONSECUTIVE DIVIDEND GROWTH
8.0																Historic dividend progression CAGR 8.5%1							6.70p2
7.0				Implied PHP 2023 dividend yield2											6.50p
																													6.20p
6.0				Share price3			Yield																		5.60p	5.90p
																									5.40p
				108.8p				6.2%															5.125p	5.25p
																				4.88p	5.00p
5.0																				4.63p	4.75p
																	4.38p	4.50p
																	4.25p
																4.13p
4.0														3.38p	3.75p
3.0												2.75p	3.00p
									2.50p
									2.25p
								2.00p
2.0						1.75p
	1.40p	1.50p
1.0	0.80p																															2023Q1
0.0
1997	1998		1999	2000		2001	2002	2003		2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022	2023

Historic dividend cover

120%
	84%	98%	100%	100%	101%	101%	100%	101%	102%
100%
80%
57%
60%
40%
20%
0%
2013	2014	2015	2016	2017	2018	2019	2020	2021	2022

1. CAGR: 1997 to 2023
2. Based on Q1 2023 dividend of 1.675p declared per share annualised and is illustrative only
3. Share price is the closing mid market price on 21 February 2023

• Q1 2023 dividend of 1.675p per quarter declared (equivalent to 6.7p annualised) a 3.1% increase and 27th year of growth
• Improved dividend cover at 102%
• Total dividends paid increased by 5.2% compared to 2021

Primary Health Properties PLC Annual Results Presentation 2022

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