Interim Results

Primary Health Properties PLC
15 March 2004

Embargoed for release at 7.00am on 15 March 2004



                     PRIMARY HEALTH PROPERTIES PLC ("PHP")
            Modern accommodation for the Provision of Primary Health
                                 Care Services

                    Interim Results for the six months ended
                                31 December 2003


Group Financial Highlights

*Basic earnings per share increased by 16.4% to 6.4p (2002: 5.5p)
*Portfolio revaluation increase of £4m
*Basic NAV per share increased 32.5% to 239.4p (2002: 180.7p)
*Pre-tax profit increased 21% to £1,239,000 (2002: £1,024,000)
*Interim dividend increased 10% to 5.5p (2002: 5.0p)
*Portfolio (including finance leases) increased 27.3% to £106.3m (2002: £83.5m)

Harry Hyman, Managing Director, commented:

"We have made further significant progress in all areas of our business.  All of
our key performance indicators have improved on a comparable basis and I am
particularly pleased to report a 32 per cent increase in gross NAV following the
introduction of a new policy of interim valuation.  This valuation reflects the
quality of our portfolio and the covenant strength for which we have become
recognised.

"Primary care issues are a mainstay of current government policy and the demand
for modern and proper working environments is increasing.  We have made a good
start to the second half of the financial year and look forward to the future
with great confidence."

Enquiries:

Bell Pottinger Corporate & Financial
David Rydell, Director
Tel: [phone]

Primary Health Properties PLC
Harry Hyman
Managing Director
Tel: [phone]
Mobile: [phone]


Chairman's Statement

The Group profit before taxation for the six months to 31 December 2003 totalled
£1,239,000 (2002: £1,024,000), an increase of 21%.

Profit after taxation was £1,116,000 (2002: £913,000), an increase of 22%,
yielding basic earnings per share of 6.4p (2002: 5.5p) and diluted earnings per
share of 5.9p (2002: 5.1p), an increase of 16%.

The Board has decided to undertake a revaluation of the Group's property
portfolio every six months instead of just annually. As a result of this the
value of the property portfolio has increased by £4.0 million, with the basic
net asset value per share increasing to 239.4p per share compared to 226.7p at
30 June 2003. This reflects both rental increases and current yields in the
market. In addition the net asset value was also affected by the issue of
1,386,667 shares following the exercise of management options held by the Joint
Managers and the issue of 22,669 Ordinary Shares pursuant to the scrip dividend
scheme. On a diluted basis the net asset value per share was 216.0p (30 June
2003:200.6p).

The Board proposes to pay an interim cash dividend of 5.5p per share on 20 May
2004, an increase of 10% (2002: 5.0p), to Shareholders on the register of
members on 26 March 2004.

The Board has the authority to offer Ordinary Shares instead of cash in respect
of dividends. A circular offering Shareholders on the register of members on 26
March 2004 the opportunity to elect to receive new Ordinary Shares instead of
the cash dividend in respect of the interim dividend, together with a Form of
Election and/or Notice of Entitlement will be posted to Shareholders with the
interim report on 6 April 2004.  The latest date for receipt of the Forms of
Election is 6 May 2004.

During the six months ended 31 December 2003 we have taken delivery of completed
and fully let properties at Apsley Lane, Nottingham and Hawthorn Medical
Practice, Skegness and entered into new commitments totalling £12.1 million
during the period at Bentley in West Midlands, Dalkeith in Scotland, Llandudno
in North Wales and Burton Latimer in Northamptonshire. Since 31 December 2003 we
have entered into a further £6.7 million of commitments, including a property at
Amwell Street, London, that has completed at a cost of £4.2 million.


The table below sets out the portfolio at 31 December 2003:

                                                           31 December 2003                31 December 2002
                                                           £m                              £m
Investment properties                                                  99.4                            80.2
Properties in the course of development                                 2.6                             0.8
Finance Leases                                                          2.6                             2.5
Development loans                                                       1.7                             0.0
Total owned and leased                                                106.3                            83.5
Deposit paid                                                            0.1                             0.0
Committed                                                              21.0                             2.6
Total owned, leased and committed                                     127.4                            86.1

We have a strong forward pipeline of transactions.

The rent roll has increased from £6.9 million at 30 June 2003 to £7.2 million at
31 December 2003, representing both new deliveries and rental increases. Work
continues on outstanding rent reviews, and we expect to continue to obtain
satisfactory rent reviews.

We have continued to monitor our exposure to interest rates and have entered
into a new £10 million swap arrangement for six years from 2007 to 2013 and a
new £10 million swap arrangement for ten years from 2004 to 2014. For the 2004
calendar year we have covered approximately 72% of our exposure to interest
rates at an average rate before margin of 4.8%, falling gradually to
approximately 48% in 5 years time with an average rate before margin of 5.0%.

During January we agreed a further increase of £20 million in our banking
facilities which now total £95 million. The Board has decided to recommend to
shareholders at the Annual General Meeting an increase in the Group's gearing
level to 75% of Gross Assets. This would enable the Group to expand its
portfolio to £190.7 million based on existing equity and quasi equity resources.
The Board will also be considering the implications of the Treasury's
consultation programme on Real Estate Investment Trusts.

During the period Nexus Property Management Services Limited and J O Hambro
Capital Management Limited exercised management options in respect of 960,000
and 426,667 shares at £1 each. In addition 22,669 Ordinary Shares were issued
pursuant to the scrip dividend alternative. The number of Ordinary Shares in
issue as at 31 December 2003 was 18,126,313.

The share save scheme has 34 members holding 32,403 Ordinary Shares.

The portfolio at the date of this report has 54 properties with a further 11
contracted for delivery. The portfolio has performed well and we believe that
the combination of the high quality property portfolio, long lease lengths and
strong covenant quality make a very desirable portfolio.

G.A.Elliot
Chairman
12 March 2004


CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the six months ended 31 December 2003
                                                       Six months                 Year         Six months
                                                            ended                ended              ended
                                                      31 December              30 June        31 December
                                                             2003                 2003               2002
                                                            £'000                £'000              £'000
                                                      (unaudited)            (audited)        (unaudited)

Turnover                                                    3,641                6,711              3,208
Administrative expenses                                      (823)              (1,399)              (655)

Operating profit                                            2,818                5,312              2,553
Share of operating loss in joint venture                        -                 (178)               (86)

                                                            2,818                5,134              2,467

Interest receivable                                            46                   55                 32
Interest payable                                           (1,625)              (3,010)            (1,475)

Profit on ordinary activities before tax                    1,239                2,179              1,024

Taxation                                                     (123)                (226)              (111)

Profit on ordinary activities after tax                     1,116                1,953                913

Dividend
Interim dividend of 5.5p per share                           (997)              (1,671)              (835)
  (2003: interim 5.0p and final 5.0p)
Additional final dividend 2003*                               (69)                   -                  -

Profit retained for the period                                 50                  282                 78

Earnings per share   - basic                                  6.4p                11.8p               5.5p
                     - diluted                                5.9p                10.8p               5.1p


* Additional final dividend 2003 - as a result of the Joint Managers exercise of
options to purchase 1,386,667 Ordinary shares on 17 September 2003, they were
entitled as Shareholders of these new shares on the register at 26 September
2003 to receive the final dividend in respect of the year ended 30 June 2003.


CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the six months ended 31 December 2003
                                                              Six months                Year        Six months
                                                                   ended               ended             ended
                                                             31 December             30 June       31 December
                                                                    2003                2003              2002
                                                                   £'000               £'000             £'000
                                                             (unaudited)           (audited)       (unaudited)

Profit for the financial period excluding share of loss            1,116               2,131               999
in joint venture
Share of joint venture loss for the period                             -                (178)              (86)

Profit for the financial period attributable to members            1,116               1,953               913
of the Parent Company
Unrealised surplus on revaluation of properties                    4,000               7,497                 -

Total gains and losses relating for the period                     5,116               9,450               913


There were no recognised gains and losses other than those passing through the
profit and loss account.

All activities are continuing


CONSOLIDATED BALANCE SHEET
at 31 December 2003
                                                             At 31                At 30              At 31
                                                          December                 June           December
                                                              2003                 2003               2002
                                                             £'000                £'000              £'000
                                                       (unaudited)            (audited)        (unaudited)

Fixed Assets
Tangible assets                                            103,680               93,710             81,051
Investments                                                      -                  (31)               (39)

                                                           103,680               93,679             81,012
Current assets
Debtors                                                      1,312                  658                602
Net investment in finance leases: amounts                    2,561                2,573              2,556
falling due in more than 1 year
Cash at bank                                                 1,989                  418              2,003

                                                             5,862                3,649              5,161

Creditors: amounts falling due within one year:             (5,048)              (5,219)           (11,993)

Net current assets/(liabilities)                               814               (1,570)            (6,832)

Total assets less current liabilities                      104,494               92,109             74,180

Creditors: amounts falling due after
more than one year:
Term loan                                                  (57,100)             (50,200)           (40,000)
Convertible loan stock 2016                                 (4,000)              (4,000)            (4,000)

                                                           (61,100)             (54,200)           (44,000)

                                                            43,394               37,909             30,180

Capital and reserves:
Called up share capital                                      9,063                8,358              8,349
Share premium account                                        7,419                6,689              6,670
Capital reserve                                              1,618                1,618              1,618
Revaluation reserve                                         24,253               20,253             12,756
Profit and loss account                                      1,041                  991                787

Equity shareholders' funds                                  43,394               37,909             30,180



Net asset value   - basic                                   239.40p              226.77p            180.74p
                  - diluted                                 216.04p              200.61p            164.94p



SUMMARISED CONSOLIDATED CASH FLOW STATEMENT
for the six months ended 31 December 2003
                                                          Six months                Year         Six months
                                                               ended               ended              ended
                                                         31 December             30 June        31 December
                                                                2003                2003               2002
                                                               £'000               £'000              £'000
                                                         (unaudited)           (audited)        (unaudited)

Net cash inflow from operating activities                      2,506               5,916              2,962

Return on investment and servicing of finance

Interest received                                                  6                  10                  4
Interest paid                                                 (1,882)             (2,351)            (1,419)

Net cash outflow from return on investment and                (1,876)             (2,341)            (1,415)
servicing of finance

Taxation
UK Corporation tax recovered                                       -                   3                  3

Capital expenditure
Payments to acquire tangible fixed assets                     (4,820)             (8,536)            (3,079)
Development loan advanced                                     (1,637)                  -                  -
Loan to joint venture                                            (27)               (100)                 -

                                                              (6,484)             (8,636)            (3,079)

Equity dividends paid                                           (857)             (1,544)              (742)

Net cash outflow before financing                             (6,711)             (6,602)            (2,271)

Financing
Ordinary share issue (net of expenses)                         1,382                 209                213
Term bank loan 2008                                            6,900              10,200                  -
Revolving 364 day facility                                         -              (3,750)             3,700

Net cash inflow from financing                                 8,282               6,659              3,913

Increase in cash                                               1,571                  57              1,642



RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT

                                                          Six months                Year         Six months
                                                               ended               ended              ended
                                                         31 December             30 June        31 December
                                                                2003                2003               2002
                                                               £'000               £'000              £'000
                                                         (unaudited)           (audited)        (unaudited)

Increase in cash in the period                                 1,571                  57              1,642
Cash inflow from loans                                        (6,900)             (6,450)            (3,700)

Movement in net debt in the period                            (5,329)             (6,393)            (2,058)

At the beginning of the period                               (53,782)            (47,389)           (47,389)

At the end of the period                                     (59,111)            (53,782)           (49,447)

Net debt comprises:

Cash at bank and in hand                                       1,989                 418              2,003
Term loan                                                    (57,100)            (50,200)           (40,000)
Convertible Loan Stock 2016                                   (4,000)             (4,000)            (4,000)
Revolving 364 day bank loan                                        -                   -             (7,450)

                                                             (59,111)            (53,782)           (49,447)



RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING ACTIVITIES

                                                          Six months                Year         Six months
                                                               ended               ended              ended
                                                         31 December             30 June        31 December
                                                                2003                2003               2002
                                                               £'000               £'000              £'000
                                                         (unaudited)           (audited)        (unaudited)

Operating profit                                               2,818               5,312              2,553
(Increase)/decrease in operating debtors and                    (380)                272                104
prepayments
Increase in operating creditors and accruals                      68                 332                305

Net cash inflow from operating activities                      2,506               5,916              2,962


NOTES:

1.       The interim financial information has been prepared on the basis of the
accounting policies set out in the Group's 2003 statutory accounts.

2.       The freehold properties are included at valuation as at 31 December
2003. Fixed assets consist of:

                                                         31 December             30 June        31 December
                                                                2003                2003               2002
                                                               £'000               £'000              £'000
                                                         (unaudited)           (audited)        (unaudited)

Tangible assets:
Investment properties                                        102,001              93,699             81,037
Development Loans                                              1,679                  11                 14

                                                             103,680              93,710             81,051
Investments:
Investment in joint venture
  Share of gross assets                                           39                  75                  8
  Share of gross liabilities                                     (39)               (106)               (47)

                                                                   -                 (31)               (39)

                                                             103,680              93,710             81,012

JOINT VENTURE

Primary Health Properties plc owns 50% of the issued Ordinary share capital of
Primary Health Solutions Limited, a company created for the purpose of
developing properties for sale and leaseback and to tender for contracts under
the Government's LIFT (Local Improvement Finance Trust) initiative.  The
remaining 50% of the issued Ordinary share capital is owned by Brackley
Investments Limited.

3.       The calculation of earnings per share is based on earnings of
£1,116,000 (30 June 2003: £1,953,000; 31 December 2002: £913,000) and 17,520,993
Ordinary shares (30 June 2003: 16,612,427; 31 December 2002: 16,530,218) being
the weighted average number of shares in issue during the period.  Diluted
earnings per share is calculated in accordance with Financial Reporting Standard
No. 14: Earnings per Share.  It is based on earnings of £1,257,000 (30 June
2003: £2,232,000; 31 December 2002: £1,054,000) and 21,235,898 Ordinary shares
(30 June 2003: 20,694,213; 31 December 2002: 20,629,066) being the weighted
average number of Ordinary shares in issue during the period.

Earnings:                                              Weighted Average Number of Ordinary Shares:

                                                     £                                              Number
Profit on ordinary activities                          Issued share capital*                    17,520,993
 after tax                                   1,116,000 Dilutive effect of options**                236,644
Interest saved on                                      Dilutive effect of convertible
 conversion of loan stock                              loan stock***                             3,478,261
 (including adjustment for tax)                141,000

                                             1,257,000                                          21,235,898


* Weighted average number of ordinary shares in issue during the period

** Excess of the total number of potential shares on option exercise over the
number that could be issued at fair value as calculated in accordance with 
Financial Reporting Standard No. 14: Earnings per share.

*** The total number of potential shares on conversion of the convertible loan
stock.


4.       Diluted net asset value has been calculated as follows:


                                                         31 December             30 June         31 December  
                                                                2003                2003                2002
                                                                £'000              £'000                £'000
                                                          (unaudited)          (audited)          (unaudited)
Net assets:
Per Consolidated Balance Sheet                                 43,394             37,909               30,180
Add - Loan Stock conversion                                     4,000              4,000                4,000
       - Receipts from the exercise of
          options                                               2,736              1,387                1,387

                                                               50,130             43,296               35,567


                                                         No. of shares      No. of shares        No. of shares
Ordinary shares:
Issued share capital                                       18,126,313         16,716,977           16,698,333
Add - Loan Stock conversion into shares                     3,478,261          3,478,261            3,478,261
New shares issued on exercise of options                    1,600,000          1,386,667            1,386,667

                                                           23,204,574         21,581,905           21,563,261

Calculations assume that the dilution takes place on the respective balance
sheet dates.

5.       The financial information herein does not constitute statutory accounts 
as defined in Section 240 of the Companies Act 1985. The financial information 
for the year ended 30 June 2003 is based on the statutory accounts for the year. 
Those accounts, upon which the auditors issued an unqualified opinion, have 
been delivered to the Registrar of Companies.

The Interim report will be posted to shareholders and those on the mailing list
as soon as practicable after printing and will also be available on request from
the Company Secretary, J O Hambro Capital Management Limited, Ground Floor, 
Ryder Court, 14 Ryder Street, London, SW1Y 6QB.


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