Trading update & notice of interim dividend
Summary by AI BETAClose X
13 January 2026
Primary Health Properties PLC
("PHP", the "Group" or the "Company")
Trading update & notice of interim dividend
Company's 30th anniversary of consecutive dividend growth
Primary Health Properties PLC, the UK's leading investor in modern primary healthcare facilities, today publishes a trading update for the year ended 31 December 2025 and announces the first 2026 quarterly interim dividend of 1.825 pence per ordinary share, equivalent to 7.3 pence (2025: 7.1 pence) on an annualised basis, marking the Company's 30th anniversary of consecutive dividend growth.
Highlights
· Transformational combination between PHP and Assura successfully delivered, creating a £6 billion healthcare REIT
· 60% of total annualised synergies of £9 million, identified at time of the deal, already delivered in the c. 2 months since Competition and Markets Authority ("CMA") clearance, as integration moves forward at pace and benefits of the deal are delivered for shareholders
· Rent reviews in the year generated an additional £8.3 million, an increase of 6.8% over the previous passing rent or 3.2% on an annualised basis, which supports our positive rental growth outlook. Annualised contracted rent roll now stands at £342 million
· Enlarged Group is now well placed to take advantage of the improving rental growth outlook across primary care and private hospitals, with six developments on site and an advanced pipeline of 51 asset management projects
· Good progress is being made on expanding the existing joint ventures and establishing a strategic joint venture for our private hospital portfolio where we see exciting growth opportunities
· Strong support from the debt and credit markets for the combination with the refinancing of Assura debt facilities, subject to change of control clauses, now completed providing the enlarged Group with significant undrawn liquidity headroom, after capital commitments, of £552 million, a weighted average cost of debt of 3.7% and debt maturities of just over four years
Mark Davies, CEO of PHP, commented:
"2025 was a transformational year for PHP, obtaining overwhelming shareholder and wider stakeholder support for the combination with Assura plc ("Assura") to create a £6 billion healthcare REIT invested in critical social infrastructure across the UK and Ireland which will deliver financial and strategic benefits to our stakeholders. Our immediate focus is now on delivering the post-transaction objectives of reducing leverage back to our targeted range of 40% to 50%; delivering the £9 million of annualised synergies identified; and integrating the two businesses to achieve the best of both organisations.
"We are delighted to be reporting that, despite only two months since CMA clearance on 29 October 2025, we have made good progress on delivering against the above objectives and we expect to report further progress with the Group's full year results.
"The NHS's 10-year Health Plan published in July 2025 is clearly positive for PHP. We welcome the Government's commitment to strengthening the NHS, particularly its emphasis on shifting more services to modern primary care facilities embedded in local communities, enhanced by the NHS Neighbourhood Rebuild programme announced in the Autumn Budget. This plays directly to our strengths and long-standing partnerships across the NHS give us a strong foundation to support this transition and deliver value to our shareholders.
"We have now achieved PHP's 30-year anniversary of consecutive dividend growth and approach the future with a dedicated determination to continue growing our dividend on a fully covered basis. We are encouraged by the improving rental growth outlook underpinned by the Group's primary care assets along with the solid trading performance from the recently acquired private hospital portfolio."
Combination with Assura
The acquisition of Assura was completed in full on 20 October 2025 when the final 2% of Assura shares were legally acquired and Phase 1 clearance from the CMA was received on 29 October 2025 which enabled integration of the two businesses to commence.
In the short space of time since CMA clearance, we have made strong progress and delivered annualised cost synergies totalling £5.4 million or 60% of the target, which has been achieved primarily through a reduction in people costs and elimination of duplicated professional fees.
The fair value of the total consideration paid for the acquisition of Assura was just over £1.6 billion funded through the issue of 1.26 billion new ordinary shares of 12.5 pence each, at a weighted average price of 93.0 pence per share, equivalent to £1,171 million, cash consideration of £407 million and transaction costs including stamp duty of £42 million.
Strategy and financial framework
The transaction has created a UK REIT of significant scale and liquidity with a combined portfolio of approximately £6 billion of long leased, sustainable infrastructure assets principally let to government tenants and leading UK healthcare providers benefiting from increased income security, longevity, diversity of assets, geography and mix of rent review types.
To support the combined Group's progressive dividend policy, paid on a quarterly basis, we have set out our strategy and financial framework which will focus on:
· 80% to 90% government backed income target with new or regeared leases typically in excess of 20 years
· Organic rental growth greater than 3% to deliver sector leading, risk adjusted total property returns
· Risk controlled and capital light asset management and development projects
· Targeting a strong investment grade credit rating of BBB+ or better
· LTV target of 40% to 50%
· Net debt : EBITDA target of less than 9.5x
· Interest cover target of greater than 2.5x net rental income with more than 90% of debt fixed or hedged
· Strong control on costs and overheads with one of the lowest EPRA cost ratios in the sector at below 10%
Joint ventures and disposals
A full portfolio review is currently ongoing and as previously reported we aim to establish new strategic joint ventures and deliver further disposals to achieve our goal to reduce leverage back to our targeted range of 40-50%.
We continue to make good progress regarding opportunities for both existing joint ventures within primary care real estate and with several highly credible counterparties regarding options for a potential joint venture for the private hospital portfolio. We are excited about the prospect of continuing to build joint ventures of size and scale which will bring financial benefits to all parties while supporting investment in critical healthcare infrastructure and generating positive social impact across the UK.
Following completion of the combination with Assura the enlarged Group has sold four non-core assets for £8.3 million.
Robust portfolio metrics
The security and longevity of our income are important drivers of our secure, long term predictable income stream and enable our progressive dividend policy.
The annualised contracted rent roll of the Group's enlarged portfolio at 31 December 2025 was £342 million and the key portfolio metrics are summarised in the table at Appendix 1.
Rental growth
The enlarged Group's sector-leading metrics remain robust and we continue to focus on delivering the organic rental growth that can be derived from our existing assets. This growth arises mainly from rent reviews and asset management projects (extensions, refurbishments and lease re-gears). These initiatives provide an important opportunity to increase income, extend lease terms and avoid obsolescence whilst ensuring that our properties continue to meet their communities' healthcare needs, improve their ESG credentials and ensure they also play a crucial role in helping the Government fulfil its 10-year Health Plan.
In the year ended 31 December 2025, both the PHP and Assura portfolios have continued to see strong organic rental growth on a like-for like basis with total income increasing by £9.1 million or 2.7% (PHP: £4.1 million or 2.6%; Assura: £5.0 million or 2.8%) continuing the improving rental growth outlook seen over recent years.
Rent review performance
In the year ended 31 December 2025, the enlarged Group generated an additional £8.3 million of extra rental income from its rent review activities, both in the UK and in Ireland.
Importantly, the Company continues to see an improving open market rent review performance for primary care assets with an additional £2.7 million an increase of 6.5% over the previous passing rent completed across 324 reviews.
The growth from rent reviews completed by both PHP and Assura in 2025 is summarised below:
1 - includes 36 reviews where no uplift was achieved. |
Asset management performance
The Group continues to progress an advanced pipeline of 51 projects across the enlarged Group which highlight the improving rental growth outlook with the current weighted average rent of £189 psm due to increase by around 15% to £218 psm post completion. These projects provide important evidence for future rent review settlements across the wider portfolio.
In the UK, across both the PHP and Assura portfolios we exchanged on eight new asset management projects, 21 lease re-gears and 20 new lettings during the year. These initiatives will increase rental income by £0.8 million, investing £5.0 million and extending the leases back to an average of 17 years for the asset management projects.
The Company will continue to invest capital in a range of physical extensions or refurbishments through asset management projects which help avoid obsolescence, including improving energy efficiency, and which are key to maintaining the longevity and security of our income through long-term occupier retention, increased rental income and extended occupational lease terms, adding to both earnings and capital values.
Development
During the year, PHP completed two net zero carbon developments at Croft, West Sussex and South Kilburn, London. Assura completed three schemes in 2025 including a net zero carbon development of an NHS children's therapy centre at Fareham, Hampshire, a GP medical centre development in Winchester, Hampshire and a primary care centre in Ballybay, Ireland.
The enlarged Group has an improved development capability at a time the sector needs new buildings and is currently on site with six developments which are summarised in the table below:
|
|
Est. practical completion |
Total cost |
Cost to complete |
Yield on cost |
|
Birr primary care centre, Ireland |
Q2 2026 |
£13.0m (€15.0m) |
£2.9m (€3.3m) |
5.1% |
|
Castlebar primary care centre, Ireland |
Q4 2026 |
£13.6m (€15.7m) |
£6.3m (€7.2m) |
5.3% |
|
Youghal primary care centre, Ireland |
Q1 2027 |
£13.9m (€16.0m) |
£10.5m (€12.0m) |
4.6% |
|
Private hospital, Peterborough |
Q1 2027 |
£20.8m |
£17.2m |
6.1% |
|
Tetbury Primary Care Centre |
Q4 2026 |
£1.0m1 |
£0.8m1 |
5.5% |
|
Weston-super-Mare PCC |
Q3 2027 |
£2.3m1 |
£1.8m1 |
5.1% |
|
Total |
|
£64.6m |
£39.5m |
5.4% |
1 - Joint ventures at share
We continue to monitor a number of potential development opportunities with a pipeline across primary care in both the UK and Ireland and private hospitals. These will only be progressed if accretive to earnings and they deliver the appropriate risk adjusted returns.
Financing
We received strong support for the combination with Assura from the debt and credit markets highlighted by the record amount of financing activity in the year including:
· The transaction was funded by way of a new £1.225 billion unsecured bridging loan provided by Citibank, N.A., London Branch, Lloyds Bank plc and The Royal Bank of Scotland Plc. We have subsequently cancelled £225 million of this facility due to the refinancing work noted below with £1.0 billion of the facility now remaining
· Change of control waivers obtained plus term extensions to the unsecured Assura £266 million term-loan and £200 million revolving credit facility
· £357 million of Assura private placement debt, subject to change of control clauses, has been refinanced since completion of the acquisition, through a combination of a new unsecured euro denominated private placement debt and re-couponing of an existing unsecured loan note, as follows:
o A new €120 million (£105 million) private placement loan, maturing in November 2032, has been issued at an all-in fixed rate of 3.89% providing a natural currency hedge for the Assura Irish property portfolio and the Laya Healthcare Facility, Cork acquired for €22 million in February 2025
o £60 million tranche maturing October 2034 has been refinanced and re-couponed at an all-in rate of 5.60%
o The balance of the private placement debt, including £70 million that matured in October 2025, has been repaid from the bridging facility put in place to finance the acquisition of Assura
· Total debt facilities at 31 December 2025 of £4.0 billion comprising £1.5 billion (37%) of PHP secured facilities and £2.5 billion (63%) of unsecured facilities including the bridging loan provided to finance the combination with Assura
· Net debt drawn at 31 December 2025 of £3.4 billion, with an average weighted maturity of just over four years, providing significant liquidity headroom with cash and collateralised undrawn loan facilities totalling £552 million after capital commitments of £56 million across the development and asset management projects currently on site.
· Weighted average interest rate of 3.7% at 31 December 2025
· Fitch confirmed Assura's credit rating as BBB+ (negative outlook) from A- following completion of the merger reflecting the execution risk of the planned asset disposals
Notice of interim dividend
The Company announces the first quarterly interim dividend in 2026 of 1.825 pence per ordinary share, equivalent to 7.3 pence on an annualised basis, which represents an increase of 2.8% over the dividend per share distributed in 2025 of 7.1 pence and will mark the 30th year of consecutive dividend growth for PHP.
The 1.825 pence dividend will be paid by way of a Property Income Distribution ("PID") of 1.325 pence and an ordinary dividend of 0.500 pence on 13 March 2026 to shareholders on the register on 30 January 2026.
The Company intends to maintain its strategy of paying a progressive dividend, paid in equal quarterly instalments, that is covered by adjusted earnings in each financial year. Further dividend payments are planned to be made on a quarterly basis in May, August and November 2026 which are expected to comprise a mixture of both PID and normal dividend.
The Company also confirms that shareholders may participate in a dividend reinvestment plan ("DRIP") in respect of the current interim dividend and any future dividends. The DRIP is provided by Equiniti Financial Services Limited ("Equiniti FS") and administered by PHP's registrars, Equiniti Limited ("Equiniti"), and provides shareholders with the opportunity to reinvest dividend payments to purchase additional ordinary shares in PHP in the market.
Shareholders who hold their ordinary shares in certificated form and who wish to participate in the DRIP will need to ensure that a completed DRIP Application Form is received by Equiniti no later than 5:00pm on 20 February 2026 (the "Election Date"). Shareholders who hold their ordinary shares in CREST and who wish to participate in the DRIP must do so by submitting an election by CREST input message by the Election Date.
The key dates for the dividend are detailed in the timetable below:
|
Timetable |
|
|
Ex-dividend date |
29 January 2026 |
|
Record date |
30 January 2026 |
|
Latest date for receipt by Equiniti of DRIP Application Forms and input of CREST elections |
5.00 p.m. on 20 February 2026 |
|
Dividend payment date/CREST credit date |
13 March 2026 |
|
Estimated DRIP purchase date |
13 March 2026 |
|
DRIP shares credited/certificates posted |
18 March 2026 |
A separate announcement with additional information concerning shares held on the Johannesburg Stock Exchange has been published via the SENS system.
Board changes
As previously reported, Jonathan Davies was appointed as an independent Non-executive Director effective from 1 December 2025. Jonathan brings a deep understanding of Assura, having served as its Senior Independent Director and, latterly, Chair providing the Company's stakeholders with continuity during the integration period and beyond.
Jonathan Murphy, Jayne Cottam and the other non-executive directors of Assura have left the business.
Appointment of Shore Capital as broker
The Company has appointed Shore Capital as corporate broker acting alongside existing brokers Deutsche Numis and Peel Hunt. JP Morgan Cazenove are no longer a retained broker.
Analyst webcast and conference call:
A live webcast and conference call facility for analysts will be held today, at 10.00am (12.00pm SAST) via.
Webcast: https://brrmedia.news/PHP_TU
Telephone: +44 (0) 33 0551 0200 / quote PHP if prompted by the operator.
If you would like to register your interest in attending the meeting, please contact Sodali & Co at PHP@client.sodali.com.
Appendix 1 - Key portfolio metrics
|
|
Primary care UK |
Primary care Ireland |
Private hospitals |
Joint ventures1 / other |
Total |
|
Number of assets |
1,059 |
28 |
33 |
22 |
1,142 |
|
Value (approx.) |
£4.9bn |
£0.3bn |
£0.7bn |
£0.1bn |
£6.0bn |
|
Rent roll (£m) |
275.0 |
20.1 |
44.1 |
2.7 |
341.9 |
|
WAULT (years) |
8.4 |
16.1 |
22.0 |
19.5 |
11.0 |
|
Review type |
|
|
|
|
|
|
OMV |
75% |
2% |
2% |
6% |
60% |
|
Indexed |
20% |
97% |
87% |
73% |
34% |
|
Fixed |
5% |
1% |
11% |
21% |
6% |
|
Total |
100% |
100% |
100% |
100% |
100% |
|
Covenant type |
|
|
|
|
|
|
GP / Government |
87% |
90% |
- |
95% |
76% |
|
Pharmacy |
9% |
6% |
- |
4% |
7% |
|
Nuffield |
- |
- |
38% |
- |
5% |
|
Circle |
- |
- |
16% |
- |
2% |
|
Spire |
- |
- |
14% |
- |
2% |
|
Ramsay |
- |
- |
13% |
- |
2% |
|
Genesis |
- |
- |
7% |
- |
1% |
|
HCA |
- |
- |
5% |
- |
1% |
|
PPG |
- |
- |
3% |
- |
0% |
|
Laya (Ireland) |
- |
- |
3% |
- |
0% |
|
Other |
4% |
4% |
1% |
1% |
4% |
|
Total |
100% |
100% |
100% |
100% |
100% |
|
Income expiry |
|
|
|
|
|
|
Holding over (£m) |
15.8 |
- |
- |
- |
15.8 |
|
< 3 years (£m) |
41.5 |
- |
0.4 |
- |
41.9 |
|
4 - 5 years (£m) |
45.0 |
- |
0.4 |
- |
45.4 |
|
5 - 10 years (£m) |
80.9 |
- |
0.5 |
0.1 |
81.5 |
|
10 - 15 years (£m) |
47.7 |
4.5 |
3.3 |
0.9 |
56.4 |
|
15 - 20 years (£m) |
29.5 |
8.6 |
2.8 |
0.6 |
41.5 |
|
20 - 25 years (£m) |
12.1 |
5.2 |
18.3 |
0.4 |
36.0 |
|
> 25 years (£m) |
2.5 |
1.8 |
18.4 |
0.7 |
23.4 |
|
Total (£m) |
275.0 |
20.1 |
44.1 |
2.7 |
341.9 |
1 - Joint ventures at share
- Ends -
For more information, please contact:
|
PHP Mark Davies, CEO Richard Howell, CFO David Purcell, Investor Relations |
Via Sodali & Co
|
|
Sodali & Co Elly Williamson Louisa Henry Saskia Bottomley |
Email: PHP@client.sodali.com Tel: +44 (0)207 250 1446 |
Further information is available at www.phpgroup.co.uk
Primary Health Properties PLC LEI code: 213800Y5CJHXOATK7X11
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