Primary Health Properties PLC (LSE:PHP, OTC:PHPRF) (PHP) has reported 0.9% growth from its rent review and asset management activities in the first-quarter of 2023, generating an extra £1.3mln on a like-for-like basis compared to the first quarter of 2021.
In a trading update. the modern healthcare facilities investor said settled rent reviews generated £1.2mln, primarily driven by the impact of inflation on both indexed-linked and open market value (OMV) reviews, while asset management activities generated an additional £100,000, with three new projects due to start shortly.
Since the acquisition of Axis, the Irish property management business has performed in line with management's expectations and PHP said it has successfully migrated all asset and property management activities in Ireland to the Axis team.
PHP said it continues to adopt “a very disciplined” approach to further investment if accretive to earnings, with future opportunities predominantly focused on Ireland and the group’s existing portfolio through asset management projects.
Rent reviews are expected to generate approximately £4mln in additional income for the whole of 2023.
The group had net debt of £1.3bn as of December 31, 2022.
The group declared a second quarterly interim dividend of 1.675p per share to be paid on May 19 to shareholders who were on the share register at the close of business on March 30. Further dividend payments are planned for August and November.
PHP chief executive Harry Hyman commented: "The first quarter of 2023 has seen a good start to the year for Primary Health and as previously reported, we believe the favourable dynamics of higher inflation and increased build costs combined with a demand for new primary care facilities and the need to modernise the estate will continue to increase future rental settlements.
"We continue to focus on income growth from our existing portfolio and are encouraged by the growth seen in the first quarter of the year.”