HealthCo Healthcare and Wellness (HCW) H2 2025 earnings summary

Executive summary

• FY25 results were significantly impacted by the receivership of Healthscope at its parent level, which represents 53% of earnings on a look-through basis, leading to suspension of distributions in H2 and an 18% year-over-year decline in FFO per unit.

• Portfolio remains diversified and resilient, with 99% occupancy, 98% contracted rent collection, and 11.5 years WALE.

• Healthscope hospitals continue normal operations, with 100% rent paid under a partial deferral agreement.

• Prudent capital management maintained, with gearing at 31%, at the lower end of the target range.

• Conditional agreements reached with alternative operators for all Healthscope assets if needed.

Financial highlights

• FY25 FFO per unit was 6.6 cents, down 18% year-over-year; DPU was 4.2 cents, with no distributions declared in H2.

• NTA per unit at $1.44 as of June 2025, reflecting a 4% gross decrease in portfolio valuation due to 37bps cap rate expansion.

• Like-for-like net income growth was 5.2% year-over-year, driven by market rent reviews and leasing spreads.

• Statutory loss for FY25 driven by fair value movements on investment properties and share of loss of equity accounted investees.

• 11.5m units bought back at an average 32% discount to NTA in FY25.

Outlook and guidance

• No FY26 guidance will be issued until the Healthscope situation is resolved; distributions expected to recommence once resolved.

• Focus remains on continuity of services, securing well-capitalized tenants, and maintaining long-term value.

• Long-term growth underpinned by demographic megatrends and a stretched public healthcare system.