Interim Management Statement

RNS Number : 8347V

Primary Health Properties PLC

09 November 2010

 



PRIMARY HEALTH PROPERTIES PLC

Interim Management Statement

Primary Health Properties PLC ("PHP", the "Group" or the "Company"), one of the UK's largest providers of modern primary healthcare facilities, today issues its Interim Management Statement for the period from 1 July 2010.

Since we reported our results to the 30th June 2010, yields have stabilised with continued strong demand for the Company's asset class.

The achieved increase in rent on those leases reviewed in the period to 30 September 2010 was a portfolio weighted average rate of 3.23%per annum.

The Directors note the initiatives announced on Monday 12 July by Secretary of State for Health, Andrew Lansley, in the Department of Health's White Paper, 'Equity and Excellence: Liberating the NHS'. The Group believes that the greatly enhanced role of the GP in the provision of NHS services will propel significantly the increasing demand for modern, purpose-built premises befitting a modern health service environment, which has the potential to create substantial opportunities for PHP.

At 31 October 2010, Group borrowings totalled £271.4m due to growth in the Group's gross asset base.  Aggregate facilities are £296.7m of which £258.4m is on a term loan basis and £10m is on an overdraft basis. The term facilities are not due for renewal/replacement until 2013. The secured facilities from Aviva totaling £28.3m acquired with Health Investments Limited amortise over 19 years, matching the average length of the underlying leases on the properties acquired.  The £3.0m facility with NatWest Bank is repayable in May 2011.

The Group continues to actively manage its portfolio and is engaged in a number of acquisition and disposal opportunities. Of note, the Group has agreed heads of terms for a new £25 m facility with Aviva Commercial Finance Ltd. This ten year interest only loan is currently being documented and will enable the Group to continue with its policy of acquisitions and the forward funding of new developments. The Group is also examining other options to refinance both its existing facilities and provide expansionary capital.

PHP remains committed to keeping a relatively high level of cover against its variable interest rate borrowings. The Group's fixed rate cover of £198m as at 8 November 2010 included £88m of callable swaps which are reviewed on a quarterly basis. The next possible call date is on 11 November 2010.  At 30 September 2010  (the latest practicable date), the valuation of the swaps was a net liability of £40m, reflecting the continued downward revision of long-term swap rates.

-Ends-

For further information contact:

Harry Hyman

Primary Health Properties PLC

T [phone]

M+44 (0)7973 344768

[e-mail]

David Rydell/Victoria Geoghegan/Samantha Boston

Pelham Bell Pottinger

Tel [phone]

This Interim Management Statement may contain forward looking statements. By their nature, forward looking statements involve risk and uncertainty because they relate to future events and circumstances.

These statements reflect the knowledge and information at the time of the release of this Interim Management Statement.  Nothing in this Interim Management Statement should be construed as a profit forecast or estimate.

Apart from the information contained in this Interim Management Statement there have been no material events or transactions affecting the Group during the period.

 

END

 

 

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