Impact Healthcare REIT (LSE: IHR)

Last close As at 21/05/2024

GBP0.89

0.20 (0.23%)

Market capitalisation

GBP368m

Impact Healthcare REIT (IHR) invests in a diversified portfolio of UK healthcare assets, particularly residential and nursing care homes, let on long leases to high-quality operators. It aims to provide shareholders with attractive and sustainable returns, primarily in the form of dividends.

Care home demand is driven by demographics and care needs, and benefits from supportive demand fundamentals, including increasing requirements from a rapidly ageing population for high-quality care and a need to reduce pressure on high-cost medical care providers in the NHS.

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Impact Healthcare REIT_resized

Sector

Real Estate

Equity Analyst

Martyn King

Martyn King

Director, Financials

Key Management

  • Andrew Cowley

    Managing partner, Impact Health Partners

  • David Yaldron

    FD

  • Rupert Barclay

    Non-executive chairman

Balance Sheet

Forecast net cash (£m)

185.2

Forecast gearing ratio (%)

N/A

Share Price Performance

Price Performance
% 1M 3M 12M
Actual 6.1 9.4 (10.7)
Relative (0.7) 0.3 (17.8)
52 week high/low 101.4p/78.9p

Financials

FY23 results showed a continued strengthening in operational and financial tenant performance, reflected in a record level of rent cover (H2: 2.2x) and a restoration of full rent collection. With cash flow remaining strong, the FY23 DPS of 6.77p (+3.5%) was 1.08x covered by adjusted ‘cash’ earnings (1.23x on an EPRA basis) and a further increase to 6.95p (+2.7%) is targeted for the current year. Contracted rents increased 13% in the year, to £49m, driven by inflation-linked rent reviews and a significant and accretive acquisition early in the period. Tenant operators have benefited from the continuing post-pandemic recovery in occupancy (to 88.2% vs 87.4% a year earlier) and strong fee growth (c 13%). The seven homes that were previously leased to Silverline are showing improved performance under the new operator.

Y/E Dec Revenue (£m) EBITDA (£m) PBT (£m) EPS (p) P/E (x) P/CF (x)
2022A 45.4 38.6 32.6 8.4 10.5 11.7
2023A 53.1 46.0 34.5 8.3 10.7 11.0
2024E 56.2 48.5 34.6 8.3 10.7 8.9
2025E 59.4 51.6 38.4 9.3 9.5 8.6

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