An ageing population and a healthcare budget in peril is providing a favourable marketplace for MedicX Fund (MXF), the specialist primary care infrastructure investor. The government is calling for more purpose-built facilities to house all primary care practices under one roof - including GPs, X-ray machines, physiotherapists and pharmacies - and MedicX is well positioned to deliver potential new schemes, according to Mike Adams, chief executive of the fund's investment adviser Octopus Healthcare.
In the first half, MedicX added three more properties to its portfolio, taking the total up to 151, with seven of these under construction. This helped to boost rental income by 6.6 per cent to £17.7m. However, finance costs incurred during the period were higher, due to a new loan of £50m.
Profit was also dampened by a lower net valuation gain on investment properties, compared with the previous year. The rise in stamp duty in the March 2016 Budget had the one-off impact of reducing the independent property valuer's appraisal by £4.1m. This meant that the overall net valuation gain in the period was restricted to £4.1m, compared with £12.8m in the first half of 2015.
Analysts at Peel Hunt are forecasting adjusted net asset value (NAV) of 77p at the September 2016 year-end, compared with 74p in the prior year.
MEDICX FUND (MXF) | ||||
|---|---|---|---|---|
| ORD PRICE: | 87.3p | MARKET VALUE: | £328m | |
| TOUCH: | 86.8-87.3p | 12-MONTH HIGH: | 91p | 77p |
| DIVIDEND YIELD: | 6.8% | TRADING PROPERTIES: | nil | |
| PREMIUM TO NAV: | 24.6% | NET DEBT: | 119% | |
| INVESTMENT PROPERTIES | £589m | |||
| Half-year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p*) |
|---|---|---|---|---|
| 2015 | 67.8 | 26.6 | 5.2 | 2.93 |
| 2016 | 70.0 | 18.5 | 2.9 | 2.96 |
| % change | +3 | -30 | -44 | +1 |
Ex-div: 19 May Payment: 30 Jun *Dividends of 1.4875p paid quarterly | ||||
