Parkway Life Real Estate Investment Trust (C2PU) Investor Presentation summary

Key highlights

• Gross revenue for YTD 3Q 2024 declined by 2.2% to S$108.5 million, mainly due to JPY depreciation, but DPU grew 2.8% to 11.30 cents, supported by FX hedges and step-up leases.

• Acquisition of a new nursing home in Osaka for JPY2,446.2 million (S$20.7 million) at 9.1% below valuation, strengthening the Japan portfolio.

• Entered France with the acquisition of 11 nursing homes for €111.2 million (S$159.9 million), fully funded by private placement, marking a strategic foray into a third key market.

• Strong balance sheet with gearing at 37.5%, interest cover at 10.2x, and 87% of interest rate exposure hedged as of 30 September 2024.

• No long-term debt refinancing needs until September 2026 after securing two 7-year JPY loans for pre-emptive refinancing.

Financial performance

• Net property income for YTD 3Q 2024 was S$102.4 million, down 2.1% year-on-year, mainly due to JPY depreciation.

• Distributable income increased by 2.8% to S$68.3 million, with DPU rising to 11.30 cents.

• Finance costs rose 7.7% due to new acquisitions and higher interest rates, partially offset by JPY depreciation.

• Net asset value per unit stood at S$2.30, with unit price at S$4.20, representing an 82.6% premium to NAV.

• DPU has grown 133.7% since IPO, with uninterrupted recurring growth.

Property portfolio

• Portfolio comprises 64 properties valued at S$2.25 billion, with 63.5% of gross revenue from Singapore and 36.3% from Japan.

• Singapore portfolio includes three major hospitals with a 20.4-year master lease, providing income certainty and organic growth.

• Japan portfolio consists of 60 nursing homes across 17 prefectures, with 95.9% of revenue downside-protected and long-term leases.

• Recent acquisition in France adds 11 freehold nursing homes with 12-year leases and 100% occupancy, further diversifying the portfolio.

• Top 10 tenants account for 88.3% of gross revenue, with no more than 3% of leases expiring annually over the next five years.