Trading Update & New Revolving Credit Facility
The information contained in this announcement is restricted and is not for publication, release or distribution in the United States of America, any member state of the European Economic Area (other than the Republic of Ireland or the Netherlands), Canada, Australia, Japan or the Republic of South Africa.
6 April 2020
Impact Healthcare REIT plc
("Impact" or the "Company" or, together with its subsidiaries, the "Group")
TRADING UPDATE
&
NEW REVOLVING CREDIT FACILITY
The Board of Directors of Impact Healthcare REIT plc (ticker: IHR), the real estate investment trust which gives investors exposure to a diversified portfolio of UK healthcare real estate assets, in particular care homes, is pleased to announce a trading update and that the Group has signed a new revolving credit facility of £50 million (the "Facility") with HSBC UK Bank plc ("HSBC").
Trading update
The Group confirms that, as at 3 April 2020, it had received 100% of the rent due in respect of the forthcoming period from its tenants who operate care homes, which represents 98.3% of the Group's total rent roll. The rent due from NHS Cumbria, which represents the remaining 1.7% of the Group's total rent roll, is expected to be paid later in the month as usual.
Of the total rent due this month, 90.5% is rent paid quarterly in advance and 9.5% is rent paid monthly in advance. The Group's total annualised rent roll as at 1 April 2020 is £24.9 million.
New bank facility
The £50m Facility is for an initial term of three years with an option to extend, subject to lender approval, for up to a further two years. The Facility has a margin of 195 basis points per annum over three-month LIBOR. £34.5 million can be immediately drawn down under the Facility, and £15.5 million is conditional on security registration of Scottish assets and the completion of transactions which have exchanged.
The Facility takes the Group's total committed facilities to £125 million, of which £26 million is currently drawn.
This Facility will help to ensure that the Group continues to be well capitalised and increases balance sheet resilience:
· As at 6 April 2020 the Group has cash of £27 million and headroom on its undrawn debt facilities of £98.9 million, of which £84.4 million is available immediately.
· The Group has £54.6 million of outstanding commitments to acquisitions and asset management initiatives, and a further £7.2 million contingent commitment to deferred payments based on future financial performance, all of which are expected to deliver incremental rental returns.
· The Group has no debt refinancing requirements before 2023.
· Debt drawn at 6 April 2020 is £26 million, giving an LTV of 7.0%, based on net asset values at 31 December 2019.
· Once facilities have been drawn to finance the outstanding commitments outlined above, drawn debt will be circa £75 million and the Group's LTV will be circa 18%, well below the Group's maximum permitted LTV of 35%.
· Once £75 million has been drawn, the Company's asset values would need to fall by more than 50% from its most recent valuations before there would be any potential breaches of its banking LTV covenants.
The Facility will help the Group to continue to manage its capital structure in line with its investment policy in a flexible manner and will support the Group with its future growth plans. However, the Group has no plans to drawdown more debt than is required to finance the existing outstanding commitments outlined above until the impact of the COVID-19 pandemic is clearer.
The Company is continuing to monitor carefully the development of COVID-19 and will keep shareholders updated with material developments as they affect the Company as the situation evolves.
FOR FURTHER INFORMATION, PLEASE CONTACT:
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Impact Health Partners LLP Mahesh Patel Andrew Cowley |
via Maitland/AMO |
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Winterflood Securities Limited Joe Winkley Neil Langford |
Tel: 020 3100 0000 |
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RBC Capital Markets Rupert Walford Matthew Coakes |
Tel: 020 7653 4000 |
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Maitland/AMO (Communications Adviser) James Benjamin |
Tel: 020 7379 5151 Email: impacthealth-maitland@maitland.co.uk |
The Company's LEI is 213800AX3FHPMJL4IJ53.
Further information on Impact Healthcare REIT is available at www.impactreit.uk .
NOTES:
Impact Healthcare REIT plc is a real estate investment trust ("REIT") which aims to provide shareholders with an attractive return, principally in the form of quarterly income distributions and with the potential for capital and income growth, through exposure to a diversified portfolio of UK healthcare real estate opportunities, in particular care homes for the elderly. The Group's investment policy is to acquire, renovate, extend and redevelop high quality healthcare real estate assets in the UK and lease those assets primarily to healthcare operators providing residential healthcare services under full repairing and insuring leases.
The Company has a progressive dividend policy with a target to grow its annual aggregate dividend in line with the inflation-linked rental uplifts received by the Group under the terms of the rent review provisions contained in the Group's leases in the prior financial year.
The Group's Ordinary Shares were admitted to trading on the main market of the London Stock Exchange, premium segment, on 8 February 2019. The Company is a constituent of the FTSE EPRA/NAREIT index.
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