Vital Healthcare prepared for growth after successful capital raise

Vital Healthcare Property Trust, which raised $160 million in July to help fund its growth strategy, says it's in a strong position.

At its annual meeting, Vital's chief executive David Carr says the company's portfolio is in its "strongest ever position", having expanded into Western Australia and South Australia this year.

In August, Vital reported a 21% gain in full-year profit to $117 million in the year ended June, with net property income up 15% to $68 million.  The trust also recognised a $102 million revaluation gain on investment property following an $84 million gain a year earlier.

At the time, it flagged $A83 million of new brownfield development projects across its Australian private hospital portfolio and said it was targeting $A20 million of strategic acquisitions.

Today, Vital says it has $A77.9 million in six developments across Australia, with five of those in New South Wales and one in South Australia.

It's also recently bought residential aged care properties in WA and NSW for $A44.1 million along with Boulcott Private Hospital in Lower Hutt in Wellington for $NZ30.7 million and a medical office building in Sydney for $A30.7 million.

"Aged care real estate continues to form part of our diversification strategy," Mr Carr says. "The aged care sector remains large and fragmented and is moving into a consolidation and growth phase that will ultimately require significant investment."

The company had a market leading weighted average lease term to expiry (WALE) ratio in Australasia of 18.4 years at September, compared to what Mr Carr says was a 5.5 year sector average.

Chairman Graeme Horsley says since the capital raise and recently announced acquisitions, the company's gearing sat at about 24%.

"This provides ample capacity to keep delivering on our brownfield development programme and any potential acquisition opportunities as they arise."

The company says unitholders will get a first quarter distribution of 2.125c per unit with 0.1320 of imputation credits, payable on December 19, with a December 5 record date.

"Vital's distribution reinvestment plan (DRP) will remain available to investors for this distribution, with a 1% discount being applied when determining the strike price," the company says.

The units last traded at $2.05 and have climbed 11% this year.

(BusinessDesk)