Reliable income has become a scarcity for investors in the wake of the Covid-19 pandemic, a fact reinforced by the UK selling negative yielding bonds for the first time this week. So although Assura (AGR) posted only 1.2 per cent growth in rental income from reviews of existing assets last year, management’s decision to raise the first quarter dividend for the 2021 financial year to 0.71p is a rare piece of good news.
Acquisitions were the prime driver of group rental income growth of 9 per cent, but developments will play an increasingly important role in increasing the value of the portfolio. Following the acquisition of healthcare development company GPI last year, 15 schemes are on site at a combined development cost of £81m, of which £50m had been spent at the year-end.
Spending on developments, acquisitions and refurbishments is set to continue this year, with management not intending to hold back any cash raised via the £185m fundraising in April for “any risk scenario”, said chief executive Jonathan Murphy.
Panmure Gordon forecasts an NAV of 56.9p at the end of March 2021, rising to 57.9p in the following year.
| ASSURA (AGR) | ||||
| ORD PRICE: | 78p | MARKET VALUE: | £ 2.07bn | |
| TOUCH: | 77.8-78.1p | 12-MONTH HIGH: | 88p | LOW: 47p |
| DIVIDEND YIELD: | 3.5% | TRADING PROP: | £20.7m | |
| PREMIUM TO NAV: | 44% | |||
| INVESTMENT PROP: | £2.1bn | NET DEBT: | 64% | |
| Year to 31 Mar | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 46.1 | 28.8 | 2.2 | 2.05 |
| 2017 | 49.4 | 95.2 | 5.8 | 2.25 |
| 2018 | 52.5 | 71.8 | 3.7 | 2.46 |
| 2019 | 53.4 | 84.0 | 3.5 | 2.65 |
| 2020 | 54.0 | 78.9 | 3.3 | 2.75 |
| % change | +1 | -6 | -6 | +4 |
| Ex-div: | * | |||
| Payment: | * | |||
| *Dividends paid quarterly, fourth quarter dividend paid on 15 April | ||||
