A much higher portfolio revaluation lifted profits at MedicX Fund (MXF) in the year to September, and this together with a rise in rental income helped boost adjusted net asset value (NAV) by 6.9 per cent, delivering a total return of 14.8 per cent.
Investment in purpose-built primary healthcare properties totalled £80.3m in the UK and Ireland, and there is a further £144m in the pipeline. Firepower for further investment will be boosted by the planned reduction in the dividend, together with a reduction in investment adviser fees and the abolition of performance fees.
Rent receivable rose by 8.6 per cent to £40.3m and will rise further because of recent acquisitions. Crucially, income growth exceeded the increase in costs. Gearing remained relatively high, with a loan-to-value ratio of 52.6 per cent, but some comfort can be gained from the quality of the rental stream, with nearly 90 per cent paid directly and indirectly by the NHS or the Irish equivalent.
Of the 95 rents reviews completed, the weighted average uplift was 4.84 per cent, well up from 1.02 per cent a year earlier.
Analysts at Peel Hunt are forecasting adjusted NAV of 84p per share at the September 2019 year-end (from 80.7p in 2018).
| MEDICX FUND (MXF) | ||||
| ORD PRICE: | 76p | MARKET VALUE: | £ 337m | |
| TOUCH: | 76-76.6p | 12-MONTH HIGH: | 86p | LOW: 74p |
| DIVIDEND YIELD: | 7.9% | TRADING STOCK: | nil | |
| DISCOUNT TO NAV: | 6% | |||
| INVEST PROPERTIES: | £808m** | NET DEBT: | 120% | |
| Year to 30 Sep | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p)* |
| 2014 | 65.1 | 20.4 | 5.9 | 5.8 |
| 2015 | 69.6 | 39.1 | 9.9 | 5.9 |
| 2016 | 71.7 | 28.2 | 7.1 | 5.95 |
| 2017 | 76.3 | 33.3 | 9.4 | 6 |
| 2018 | 81.0 | 49.1 | 10.7 | 6.04 |
| % change | +6 | +47 | +14 | - |
| Ex-div | 15 Nov | |||
| Payment: | 31 Dec | |||
| *Dividends paid quarterly. XD and pay date refers to 4th quarter dividend of 1.51p per share **Including joint ventures | ||||
