OREANDA-NEWS. Cost and funding efficiencies combined with continued asset growth have delivered strong earnings growth in 2015 for Primary Health Properties (PHP). By the year end the progressive dividend was again fully covered (107% in H215 and 98% for the year). There is political and financial support for NHS planning that should soon see an acceleration of new development spending, with good prospects for long-term growth. Property yields have contracted but funding conditions remain strong, maintaining a healthy spread and opportunity for ongoing accretive growth. Meanwhile, PHP is making a limited entry into the Irish market where it can acquire at higher debt-adjusted yields. 

PHP's progressive dividend is attractive and secure, supported by predictable long-term cash flows from mainly government-backed revenues. Healthcare property values (and PHP NAV) are also benefiting from yield compression, but historical performance has shown much less volatility than the broad commercial sector.

 

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