Target Healthcare REIT (THRL) investor relations material

Executive summary

• Delivered a 9.3% total accounting return, with a 3.7% increase in EPRA NTA and a 3% dividend increase year-over-year.

• Portfolio consists of 93 care homes, nearly 6,500 beds, and £930 million in value, with 61 million in contracted, inflation-linked rent.

• Achieved 7.5% annualized total accounting return since launch, consistently outperforming the MSCI healthcare property index by 77% over 11 years.

• Largest disposal since IPO: £86 million at 11.6% premium to book value, supporting NAV valuation.

• Active management and capital recycling have improved portfolio quality and tenant diversification.

Financial highlights

• Rental income increased 3% year-over-year, driven by inflation-linked growth and new developments.

• EPRA earnings per share decreased 0.8% to 6.08p due to exceptional costs from tenant administration.

• Dividend increased 3% and was covered at 103%, down from 107% prior year.

• Portfolio valuation rose 2.4%, with like-for-like increase of 2.6% from rent reviews.

• Ongoing charges stable at 1.51%; adjusted EPRA cost ratio increased due to nonrecurring costs.

Outlook and guidance

• Strong pipeline of over £150 million in accretive investment opportunities at yields above 6%.

• First acquisitions from pipeline expected in November, with efficient reinvestment of disposal proceeds.

• Dividend cover expected to be maintained based on conservative reinvestment modeling.

• EPS accretive acquisitions modeled at yields of 6–6.1%.