Primary Health Properties rental income, adjusted earnings grow in H1

(Sharecast News) - Care facilities investor Primary Health Properties said on Monday that it was positioned for secure income and valuation growth in FY25, supporting its progressive dividend policy. Primary Health Properties said it had seen improving rental growth and stabilisation in yields in the six months ended 30 June, underpinning valuation growth and further evidencing "an inflexion point" in the cycle. The FTSE 250-listed group said net rental income was up 3.1% at £78.6m in the half, while adjusted earnings were 2.2% stronger at £47.3m and IFRS profits surged from £3.6m in H124 to £59.4m in H125. Dividends rose 2.9% to 3.55p per share.

PHP noted that the UK Government's ten-year plan for the NHS in England, launched on 3 July, would see a move from "hospital to community", delivered through a "neighbourhood health service" that will join up multiple services through local teams to offer predictive and preventitive care that would be capable of "anticipating need rather than reacting to it".

"There is a clear theme of reducing the reliance on hospitals and an accompanying commitment to shift expenditure away from expensive hospital care. Consequently, the plan should be a catalyst for unlocking significant future opportunities in primary care and community diagnostics," PHP said. "PHP is strategically well placed to assist and support the government and NHS with the NHC programme by enhancing its existing estate through both the group's pro-active asset management and development activities."

PHP also said it continues to believe in the "compelling strategic and financial rationale" for its recommended combination with Assura, noting that the transaction was expected to be earnings accretive for both sets of shareholders.

As of 0805 BST, PHP shares were up 0.09% at 96.59p.

Reporting by Iain Gilbert at Sharecast.com