Quarterly Net Asset Valuation

RNS Number : 9957V

The MedicX Fund Limited

11 November 2010

 



For immediate release                                                                                   11 November 2010

MedicX Fund Limited

("MedicX Fund", the "Fund" or the "Company" and together with its subsidiaries the "Group")

Unaudited adjusted net asset value as at 30 September 2010

MedicX Fund Limited (LSE: MXF), the specialist primary care infrastructure investor in modern purpose-built primary healthcare properties in the United Kingdom, today announces the results of its quarterly portfolio valuation.

Valuation

The valuation of the portfolio undertaken by King Sturge LLP, independent valuers to the Company, as at 30 September 2010 stood at £211.0 million, reflecting a net initial yield of 5.88%.  This is broadly unchanged from the net initial yield of 5.87% in June 2010, and a consolidation of the property values further to the uplift reported in the first half from the 30 September 2009 valuation of 6.06%.

Unaudited net asset value

Incorporating the September valuation, the unaudited adjusted net asset value at 30 September 2010 is estimated to be £92.9 million, equivalent to 65.7p per share. This compares with the adjusted net asset value at 30 September 2009 of 62.0p per share.  

Long-term interest rates have decreased since 30 June 2010 and, including the benefit of the Fund's 30-year £100 million interest only debt facility at a fixed rate of 5.008%, the unaudited adjusted net asset value plus the mark to market benefit of fixed rate debt is estimated now to be £100.9 million, equivalent to 71.4p per share.

Discounted cash flow valuation of assets and debt

On the Fund's behalf the Investment Adviser has carried out a discounted cash flow ("DCF") valuation of the Group assets and associated debt at each period end. The basis of preparation is similar to that calculated by infrastructure funds.  The values of each investment are derived from the present value of the property's expected future cash flows, after allowing for debt and taxation, using reasonable assumptions and forecasts based on the predominant lease at each property.  The total of the present values of each property and associated debt cash flows so calculated is then aggregated with the surplus cash position of the Group. 

The discount rates used are 7% for completed and occupied properties and 8% for properties under construction.  These represent 2.5% and 3.5% risk premiums to an assumed 4.5% long-term gilt rate.  The weighted average discount rate is 7.16%.

The discounted cash flows assume an average 2.5% per annum increase in individual property rents at their respective review dates.  Residual values continue to be based upon capital growth at 1% per annum from the current valuation until the expiry of leases, (when the properties are notionally sold), and also assuming the current level of borrowing facilities.

At 30 September 2010, the DCF valuation was £129.3 million or 91.5p per share compared with £93.5 million or 89.5p per share at 30 September 2009.

Rent reviews

During the year to 30 September 2010, 24 leases and rents of £1.8 million were reviewed and the equivalent of a 2.1% per annum increase was achieved.  Of these reviews, 1.8% per annum was achieved on open market reviews, 2.6% on RPI based rental reviews, and 2.5% on fixed reviews.  Following these reviews the cash yield of the portfolio has increased to 5.95%, which compares with a benchmark 20-year gilt rate of 4.01%. Reviews of £4.0 million of passing rent are currently under negotiation.

Dividends

A quarterly dividend of 1.35p per ordinary share in respect of the period 1 April 2010 to 30 June 2010 was paid on 30 September 2010 to ordinary shareholders on the register as at close of business on 20 August 2010.

The Directors have approved a quarterly dividend of 1.35p per ordinary share in respect of the period 1 July 2010 to 30 September 2010.  The dividend will be paid on 31 December 2010 to ordinary shareholders on the register as at close of business on 19 November 2010 (the "Record Date").  The corresponding ex-dividend date will be 17 November 2010.  The dividends total 5.4p per ordinary share in respect of the financial year ending 30 September 2010, an increase from the dividends of 5.33p per ordinary share for the year to 30 September 2009. 

The Company is offering qualifying shareholders the opportunity to take new ordinary shares in the Company, credited as fully paid, in lieu of the cash dividend to be paid on 31 December 2010, by participating in the Scrip Dividend Scheme (the "Scheme") previously put in place by the Company on 5 May 2010.   

The option to participate will be available to shareholders until 10 December 2010 (the "election date").  For further information on the Scheme, together with a copy of the Scheme Document (containing the terms and conditions of the Scheme) and relevant mandate forms, please refer to the Scrip Dividend portal on the Company's website.

Equity issues in the quarter

Pursuant to the block listing application announced by the Company on 26 June 2008, in the quarter ended 30 September 2010 the Company issued for cash new ordinary shares as follows:

	Number of shares	Issue price per share
10 August 2010	500,000	72.5 pence
2 September 2010	750,000	72.5 pence

In addition, on 30 September 2010 the Company issued 172,370 shares pursuant to the Scrip Dividend Scheme, based on a scrip calculation price of 71.65 pence per share.

The total number of ordinary shares of the Company in issue is 141,317,110 with each share holding one voting right, compared with 104,521,215 ordinary shares at 30 September 2009.  No shares are held in treasury.

Issue date of results

MedicX Fund will announce its results for the year ended 30 September 2010 on 8 December 2010.

David Staples

Chairman

End

For further information please contact:

MedicX Group:                                                               [phone]

Keith Maddin, Chairman

Mike Adams, Chief Executive Officer

Mark Osmond, Chief Financial Officer

MedicX Fund:                                                                [phone]

David Staples, Chairman

Buchanan Communications:                                             [phone]

Charles Ryland/Lisa Baderoon

Information on MedicX Fund Limited

MedicX Fund Limited ("MXF", the "Fund" or the "Company", or together with its subsidiaries, the "Group") is the specialist primary care infrastructure investor in modern, purpose-built primary healthcare properties in the United Kingdom, listed on the London Stock Exchange, with a portfolio comprising 57 properties.

The Investment Adviser to the Company is MedicX Adviser Ltd, which is authorised and regulated by the Financial Services Authority and is a subsidiary of the MedicX Group. The MedicX Group is a specialist investor, developer and manager of healthcare properties with 34 people operating across the UK.  

The Company's website address is www.medicxfund.com. Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

 

END

 

 

MSCGGGRAGUPUGBU