Primary Health Properties PLC
Interim results for the six months ended 30 June 2026
Combination with Assura delivering a strong operational performance and earnings growth
Primary Health Properties PLC (“PHP”, the “Group” or the “Company”), a leading investor in critical healthcare infrastructure in the UK and Ireland, announces its interim results for the six months ended 30 June 2026.
Mark Davies, CEO of PHP, commented:
“We have delivered strong earnings growth in the first half of the year, reflecting the integration of Assura and the robust underlying operational performance of the portfolio.
“We continue to make clear progress against the strategic objectives identified following the combination; 92% of the cost synergies identified have now been delivered, supporting a further reduction in our cost ratios, we continue to progress joint venture discussions to reduce leverage, and are well advanced with refinancing plans. PHP is well placed to continue delivering shareholder returns as the Assura combination has brought deeper capabilities, larger pipeline and broader opportunities for growth.
“PHP’s portfolio of critical healthcare infrastructure delivers secure, long-term and growing income which underpins our long track record of maintaining progressive dividend policy in a structural growth sector.”
FINANCIAL AND OPERATIONAL HIGHLIGHTS
| Income statement metrics | Six months to30 June2026 | Six months to30 June2025 | Change |
| Net rental income1 | £176m | £79m | +123% |
| Rental growth1 | +3.2% | +3.0% | |
| EPRA cost ratio1 | 8.7% | 9.8% | -110bps |
| Adjusted earnings1,2 | £98m | £47m | +109% |
| Adjusted earnings per share1,2 | 3.8p | 3.5p | +9% |
| IFRS profit after tax for the period | £99m | £59m | +68% |
| IFRS earnings per share2 | 3.8p | 4.4p | -14% |
| Dividends | |||
| Dividend per share4 | 3.65p | 3.55p | +3% |
| Dividend cover1 | 103% | 100% | +3ppts |
| Balance sheet and operational metrics | 30 June2026 | 31 December2025 | |
| Property portfolio | |||
| Investment portfolio valuation (including JVs at share) | £6.0bn | £6.0bn | |
| Contracted rent roll (annualised)1 | £345m | £342m | |
| Government-backed income1 | 76% | 76% | |
| Weighted average unexpired lease term (“WAULT”)1 | 10.4 years | 10.8 years | |
| Occupancy1 | 99% | 99% | |
| Net initial yield (“NIY”)1 | 5.4% | 5.4% | |
| Balance sheet | |||
| Adjusted NTA per share1,3 | 104p | 104p | |
| IFRS NTA per share1,3 | 99p | 98p | |
| Debt | |||
| Average cost of debt1 | 3.8% | 3.7% | |
| Loan to value ratio1 | 57% | 57% | |
| Weighted average debt maturity – drawn facilities | 4.0 years | 4.1 years | |
| Total undrawn loan facilities and cash5 | £301m | £571m |
1 Items marked with this footnote are alternative performance measures. Refer to the Glossary of Terms for a description of these measures and a reconciliation to the nearest statutory metric where appropriate. EPRA cost ratio excluding Axis PHP overheads and direct vacancy costs.
2 See note 6, earnings per share, to the financial statements. Per share figures are presented on a basic basis.
3 See note 6, net asset value per share, to the financial statements.
4 See note 7, dividends, to the financial statements.
5 After deducting the remaining cost to complete contracted acquisitions, properties under development and committed asset management projects.
JOINT VENTURE PROGRESS
· We have agreed exclusive terms for the establishment of a 50/50 joint venture with a global long-term institutional investor that will be seeded with £0.7 billion of private hospital assets. PHP is expected to retain a 50% interest, as well as acting as asset manager. Due diligence is well advanced and on track for summer completion
· Agreed transfer of £103 million of assets to existing primary care joint venture with USS, expecting to realise net proceeds of £82 million when complete
POST-COMBINATION OBJECTIVES ON TRACK TO COMPLETE AHEAD OF SCHEDULE
· Annualised synergies of £9 million identified at the time of the combination have been substantially delivered, with 92% realised to date and the remainder on track to be delivered in the second half of the year
· “Best-of-both” approach to talent management now flowing through to pipeline of rent review, asset management and development opportunities, which remain central to PHP’s future strategy
· Following completion of the proposed private hospital joint venture, the Group will repay the remaining acquisition bridging facility (as at today only £260 million of the £1.2 billion remains) and seek to publish an investment grade credit rating from Fitch covering the full PHP Group
· £1.2 billion of new unsecured debt facilities were completed in the period to enhance the Group’s capital structure and reduce our cost of capital, with credit margins 40bps cheaper than the facilities being replaced
EARNINGS AND DIVIDENDS
· Combination with Assura delivering strong earnings growth with adjusted earnings per share up 9% at 3.8 pence (H1 2025: 3.5 pence) and IFRS earnings per share of 3.8 pence (H1 2025: 4.4 pence)
· Annualised contracted rent roll now stands at £345 million (31 December 2025: £342 million) with rent reviews and asset management in the six months generating an additional £4 million of annualised income, offset by £1 million relating to disposals. Rent reviews generated an increase of 5.7% over the previous passing rent or 3.2% on an annualised basis, which supports our positive rental growth outlook
· EPRA cost ratio 8.7% (H1 2025: 9.8%), excluding Axis overheads and direct vacancy costs, representing one of the lowest in the UK REIT sector and a reduction reflecting the benefit of increased portfolio scale
· First three quarterly dividends totalling 5.475 pence distributed or declared in the year-to-date, equivalent to 7.3 pence per share on an annualised basis, a 2.8% increase over 2025 (7.1 pence per share) and marking the Company’s 30th consecutive year of dividend growth
· The Company intends to maintain its strategy of paying a progressive, fully covered dividend
NET ASSET VALUE AND PORTFOLIO MANAGEMENT
· Adjusted NTA per share maintained at 104 pence per share (31 December 2025: 104 pence), with the positive revaluation in the period offset by a small reduction in the fair value of fixed rate debt
· IFRS NTA per share increased by 1% to 99 pence (31 December 2025: 98 pence)
· Property portfolio valued at £6.0 billion at 30 June 2026 (31 December 2025: £6.0 billion) valued at a net initial yield of 5.4% (31 December 2025: 5.4%), reflecting the resilience of our asset class, and a modest uplift in value due primarily to the rental growth we have generated
· Revaluation surplus in the period of £18 million (H1 2025: £20 million), driven by a £29 million gain from rental growth and asset management
· The portfolio’s metrics continue to reflect the Group’s secure, long-term and predictable income stream characterised by high occupancy at 99% (31 December 2025: 99%); long WAULT of 10.4 years (31 December 2025: 10.8 years); and 76% (31 December 2025: 76%) of income funded by government bodies
· The reversionary potential of the enlarged Group’s primary care portfolio remains strong with a current low average rent of c.£200 psm (c.£20 psf) capable of being increased over time through rent reviews
· New asset management and development projects are starting to see rents being rebased to an average of £218 psm and £279 psm respectively, which make these schemes economically viable, providing crucial evidence to support our rent review activities across the wider portfolio in the future
· One pre-let development project (Birr, Ireland) reached practical completion in the period and five pre-let new build developments are currently on site to enhance our portfolio; two in Ireland, one private hospital in the UK and two UK primary care centres funded through our existing joint venture with USS
· Private hospitals and Ireland now comprise 13% and 6% respectively of the enlarged Group’s portfolio with both markets offering strong and attractive growth opportunities. This complements the continued need for significant investment in healthcare infrastructure to support the NHS’s 10-year plan objectives, including the delivery of neighbourhood health centres
FINANCIAL MANAGEMENT
· Refinancing completed in June 2026 for a new £800 million club term loan and multi-currency revolving credit facility to consolidate a number of short-term facilities across the PHP and Assura debt portfolio and cancel £335 million of the acquisition bridging facility. This marked an important step on the Group’s journey to being a fully unsecured borrower, and the margin on the new facility will be, on average, 40bps cheaper than the facilities replaced when leverage is returned to our target range
· Subsequent to the balance sheet date, a new £400 million two-year facility has been agreed to refinance and cancel a corresponding amount of the acquisition bridging facility with just £260 million now outstanding that will be repaid in full following completion of our deleveraging initiatives
· Weighted average cost of debt of 3.8% (31 December 2025: 3.7%) and weighted average debt maturity of four years (31 December 2025: 4.1 years)
· Net debt drawn at 30 June 2026 of £3.4 billion out of total debt facilities of £3.7 billion comprising £2.7 billion (74%) of unsecured facilities and £1.0 billion (26%) of secured facilities
· Current undrawn liquidity headroom of £301 million, after capital commitments
· LTV ratio 57% (31 December 2025: 57%), temporarily above the Group’s targeted range of between 40% to 50% due to the combination, continuing with our clear plan to reduce this during the second half of 2026