PHP lifts dividend, swings to profit as demand for healthcare space soars

Primary Health Properties increased its dividend as it returned to profitability driven by strong demand for extra space to relieve pressure on the National Health Service caused by the coronavirus pandemic.

The investor in healthcare facilities reported an interim pre-tax profit of £39.6m, compared to a loss of £106.1m a year ago. The dividend was lifted 5.4% to 2.95p a share.

Net rental income rose 20% to £64.8m and adjusted EPRA earnings, the underlying metric used by the company, rose 29% to £36m.

Chief executive Harry Hyman said the pandemic showed the need for “modern, integrated, local primary healthcare facilities is becoming ever more pressing in order to relieve the pressures being placed on hospitals and A&E departments”.

"As a result of the Covid-19 pandemic, we see strong demand for extra space to help alleviate the backlog of consultations that has arisen as a result of the coronavirus, while facilitating the movement of activity out of hospitals and the continued care of patients that have suffered from Covid-19.”

PHP said it expected to see the backlog of suspended non Covid-19 treatments moved away from hospitals and into primary care facilities.

“This trend will undoubtedly require substantial investment into other areas, most notably primary care that will be able to take on the non-urgent and periphery procedures,” the company added.

"The successful equity placing on 9 July raised £140m of proceeds and was upsized from £120m due to strong investor demand. The funds raised will help further accelerate our growth by funding near-term portfolio expansion, forward funded developments and asset management projects."

"PHP looks forward to delivering further earnings and dividend growth and remains confident of its future outlook."