Parkway Life Real Estate Investment Trust (C2PU) H2 2024 earnings summary

Executive summary

• FY2024 distributable income rose 2.3% year-over-year to S$91.4 million, with DPU up 1.0% to 14.92 cents; excluding equity fund raising, DPU would have increased 2.3% to 15.11 cents.

• Gross revenue and net property income declined 1.5% and 1.8% year-over-year, mainly due to JPY depreciation, partially offset by new acquisitions in Japan and France.

• Major acquisitions included one nursing home in Japan (August 2024) and eleven nursing homes in France (December 2024), fully funded by an oversubscribed S$180m equity fund raising.

• Portfolio expanded to 75 properties across Singapore, Japan, Malaysia, and France, valued at S$2.46 billion as of 31 December 2024.

• 67.2% of rental income tied to CPI-based revisions, providing inflation hedging.

Financial highlights

• FY2024 gross revenue: S$145.3m (-1.5% year-over-year); net property income: S$136.6m (-1.8%).

• 2H2024 DPU: 7.38 cents (-1.3% year-over-year), impacted by enlarged unit base from equity fund raising.

• Net income after tax for FY2024 was S$95.0 million, down from S$100.5 million in FY2023.

• Net asset value per unit: S$2.41 (Group), S$2.54 (Trust); unit price at S$3.75, a 55.6% premium to NAV.

• Gearing at 34.8% with interest cover of 9.8x and all-in debt cost of 1.48%.

Outlook and guidance

• No long-term debt refinancing needs until September 2026; ample debt headroom before regulatory gearing limits.

• 87% of borrowings/interest rate exposure hedged as of year-end; FX risks managed via JPY forward contracts and natural hedges.

• Focus on strengthening existing markets, building a third key market (Europe), and fostering strategic partnerships for mid- to long-term growth.

• Portfolio expected to benefit from resilient healthcare and aged care demand, supported by demographic trends.