Primary Health Properties Share Discussion Threads

[badtime] 05/10/2015 16:32

Nice rise today

[daveofdevon] 30/9/2015 07:31

30 September 2015

Hardman & Co issues research report on Primary Health Properties

Dividend cover improves to over 100% then more: PHP interim results last month evidence good growth, strong efficiency gains in financing and operating costs and a pleasing revaluation gain. The dividend is progressive and with a cover of 89% H1, we see cover of just over 100% H2 and 104% next year. There have been 19 years' unbroken dividend increases paid since founding. We are encouraged to see operational efficiency improvements slightly ahead of expectations. Cost of debt stands at 4.9% and falling. This is a secure and growing real estate investment.

[bscuit] 19/9/2015 10:17

Odd. AGR had a stellar few days particularly on Friday and PHP has a bad afternoon shortly after USA opens.....switching?

[ygor706] 20/8/2015 09:57

Good numbers from PHP this morning together with an increase in both the divi and the cover plus a move to quarterly dividend payments. Things going very much to plan here.

[badtime] 26/4/2015 12:39

Just read post 641...well he seems to have got it wrong on this and AGR :)

[ygor706] 01/3/2015 11:09

Good recent results has underpinned a higher trending share price here. The long term strategy of the Directors to cover the divi looks to me as if it's working. Am therefore anticipating a better capital as well as income performance over the next 12 months.

[old crow] 13/9/2014 17:34

Tom, yes we love them bringing us nice part retirement income

[tom triple] 12/9/2014 16:18

Primary Health Properties (PHP) research report from Intellisys - Intelligent Analysis - PHP News- Today, 8:06 AM

[old crow] 12/9/2014 11:57

Coming up to ex div now we have high buy ratio to sell and price holding
just plain ridiculous Market makers fiddling.

[bottomfisher] 26/8/2014 14:22

Many thanks Goliard. Your thoughts make a lot of sense and are much appreciated.

[goliard] 26/8/2014 13:20

Yes. Assura was in a mess for many years as they diversified in medical services (in particular), which was heavily loss making and pretty much eclipsed the underlying strong property business. They finally exited all the extra businesses about 3 years ago and replaced the entire board of directors (execs and non-execs) and the business got back to focusing purely on property. It has taken a couple of years for the markets to appreciate the transformation, hence the strong price gains. personally I think Assura is a better option than PHP as the dividend is fully covered, they are internally managed so don't pay fund management fees, and they also make development profits (whereas PHP is just an owner, not a developer), but i don't think there is any real upside in the price for either share going forward and they are just yield plays now and they seem fully valued.

Finally, they seem almost certain to take a hit once interest rates start to rise, as the main attraction of them at the moment is their yield versus bonds and as that starts to narrow there is less reason to hold the shares. probably still safe enough for a year or two yet though.

[bottomfisher] 21/8/2014 13:03

As a newcomer to the medical property sector are there any obvious reasons why Assura's shares have handsomely outperformed PHP's shares on a 1 and 5 year basis. Both companies are fishing in the same marketplace, and their loan to value ratios are similar. PHP has increased its dividend for 17 years in a row which is the sort of discipline I like in a company. Any comments gratefully received.

[scallywagkid] 21/8/2014 09:58

Peel Hunt morning note...

Interims, returning to full dividend cover

PHP's dividend cover has been transformed through the PPP acquisition, a reduced cost base and significantly lower financing costs. The company's super-secure income stream produces a 5.7% dividend yield – one of the highest in the
sector – and cover has improved to 76% in H1 and is set to return rapidly to full cover. Buy.

Adj NAV +2.7% to 308p – already ahead of our Dec 2014E forecast of 306p.

NAV was driven by a property valuation surplus of +1.7%, which offset the
partially uncovered dividend and convertible issue costs. The valuation rise was
driven by 7bps yield compression, with the equivalent yield now 5.64%. We
previously assumed a +1.5% surplus in the full year (increased to +3% today).

Adjusted EPS increased substantially by +54% to 7.4p. This is broadly in line
with our expectations for H1, and the year-on-year increase was driven by:

Lower average cost of debt – PHP announces further revisions and
extensions to loans and, combined with the PPP refinancing, PHP's
average cost of debt fell to just 4.6% in H1, from 5.3% in 2013.

Acquisitions – rent in the period is +50% higher than H1 last year, driven by
purchases, including the £233m acquisition of the PPP property portfolio.

A reduction in the cost base following the switch of admin/accountancy
services to Nexus, saving £1.2m on an annualised basis from May 2014.

The interim dividend (9.75p) and the proposed second interim dividend (also
9.75p) are both as expected and equate to a 5.7% dividend yield. In H1, the
dividend was 76% covered, and this is set to rise following further acquisitions
and as the full benefit of the lower financing and management costs is absorbed.
We now forecast full-year cover of 80%, rising to 92% next year.

PHP has made £23m of acquisitions in H1 and has a "strong pipeline" of
£85m of assets in solicitors' hands or at advanced stages of negotiations. PHP
is optimistic that further assets will be purchased or committed in H2.

The average annualised uplift on rent reviews was +1.9% – a slight reduction
over last year (2.2%), but in line with management guidance and our +2.0%
assumption. Management expects to see reviews continue at this lower level in
the immediate future, but then increase as developments progress.
Dec 2014E forecasts upgraded:

Adjusted NAV increased +3% to 316p (from 306p) for a +9% premium.

Adjusted EPS increased to 15.7p (from 15.4p); this assumes a further £20m in
acquisitions in H2.

DPS unchanged at 19.5p for 5.7% yield.

PHP trades on a 4.6% EPS yield and 5.7% dividend yield, versus Assura on a
4.8% EPS yield and 4.2% dividend yield (as per consensus).

[old crow] 21/8/2014 08:40

Good report remember what the crow said, good buy at 340 on the 8th August.

[ygor706] 21/8/2014 07:33

Good figures this morning..........Harry well on the way to his target of getting the divi covered. At some stage the share price will wake up to what is going on here!

[holts] 20/8/2014 08:18

Surely if the div is uncovered its size is not important as they should never have been in that position , ie not what this type of investment is all about , security.

[old crow] 08/8/2014 11:28

Could be wrong but reckon lots will wish they bought in around 340
when they declare div on the 21st this month.

[diegorodriguez] 14/5/2014 12:42

£75m convertible bond issue interview with Harry Hyman. hxxp://goo.gl/994rUL

[goliard] 13/5/2014 08:58

Yes, but it is convertible at the company's discretion, not the bond holders. Doesn't that change the view?

[edwardt] 13/5/2014 08:53

a convertible is a good thing if the shares do well - you only convert if they are in the money.

[goliard] 13/5/2014 08:30

Unimpressed with the new bond offering. Maybe they will get it away, but it feels like the opposite of what a bond should be, ie risky. The yield just doesn't justify the risk of being forced to take shares at a PREMIUM should the company wish to pay back that way. If / when rates rise next year this becomes even less attractive for investors. I guess they will probably get it away, but wouldn't be for me.

[rik shaw] 14/4/2014 20:00

New Edison note out at



forecasting dividend cover by 2015..