Vital Healthcare Property Trust : HY22 Interim Results Presentation

HY22 interim results presentation

24 FEBRUARY 2022

Contents

Overview	3
HY22 highlights	8
Financial results & capital management	11
Portfolio & acquisitions	18
Developments	24
Future focus	30
Appendices	33

Presenters

Aaron Hockly

Fund Manager

Michael Groth

Chief Financial Officer

Richard Roos

Exec. Director, Portfolio

Chris Adams

Exec. Director, Projects

All amounts are in NZD unless otherwise shown

VITAL HEALTHCARE PROPERTY TRUST  |  INTERIM RESULTS 2022  |  2

Overview of Vital

VITAL IS THE ONLY SPECIALIST HEALTHCARE LANDLORD LISTED ON THE NZX

NORTHERN

TERRITORY

WESTERN

AUSTRALIA

SOUTH

4AUSTRALIA

3

~$2.2bn

31* PROPERTIES (AUS)

QUEENSLAND

6

NEW SOUTH

WALES

12

VICTORIA

6

TASMANIA

17.8 year ~$3bn

WALE	43* PROPERTIES
	(AUS & NZ)

12

~$0.8bn

12* PROPERTIES (NZ)

VITAL HEALTHCARE PROPERTY TRUST (VITAL) IS:

The owner of a ~$3 billion healthcare property portfolio in New Zealand (27% of assets) and Australia (73%);

The only NZX-listed specialist healthcare landlord (NZX ticker: VHP);

Externally managed by a subsidiary of Toronto-listed, global healthcare real estate owner and manager, NorthWest Healthcare Properties REIT (TSX ticker: NWH);

Underpinned by rental income that tracks inflation with ~86% of lease income indexed to CPI in some way; and

Targeting 2-3% AFFO and DPU growth per annum over the medium term, whilst retaining a conservative pay-out ratio.

*Excludes strategic assets held for development

VITAL HEALTHCARE PROPERTY TRUST  |  INTERIM RESULTS 2022  |  3

Vital's 2-year progression despite COVID-19

PORTFOLIO ENHANCEMENTS SUPPORT TARGET OF GROWING AFFO AND DISTRIBUTIONS BY 2-3% PER UNIT PER ANNUM

TOTAL PROPERTY VALUE

~$2bn		~$3bn
(AUS:75%, NZ:25%)		(AUS:73%, NZ:27%)
2019		2021

52.6%

growth

WEIGHTED AVERAGE CAP RATE

5.52%4.67%

20192021

Reduction demonstrates: (1) quality of assets and tenants; and (2) value added by leasing and development undertaken

	WALE
17.9 years		17.8 years
2019		2021

Maintenance of market leading WALE

DEVELOPMENT PIPELINE

~$200m >$1bn2

20192021

Enhance earnings and valuation growth and supports portfolio development

AVERAGE BUILDING AGE1

14.0 years	10.7 years
2019	2021

Younger buildings reduce current and future maintenance capex requirements

LARGEST SINGLE TENANT EXPOSURE

46%20%

20192021

Concentration risk reduced

NET PROPERTY INCOME (ANNUAL)

$98.8m $113.4m

CY19CY21

14.8%

increase

SECTOR SPLIT

	Hospital:86%		Hospital: 82%
Ambulatory Care: 11%		Ambulatory Care: 13%
	Aged Care: 3%		Aged Care: 5%
2019		2021

Diversity of assets reduces risk and enhances earnings

Portfolio enhanced through acquisitions, development and disposals to: (1) increase diversity of assets and tenants,

(2) reduce age of building and (3) maintain long WALE. This helps to reduce income risk for Vital's unitholders

1 Average building age = the later of the date of construction or the last significant capital works
2 Includes $161.4m of committed development spend remaining and ~$1bn of developments being considered. Development	VITAL HEALTHCARE PROPERTY TRUST  |  INTERIM RESULTS 2022  |  4
timing and therefore spend expected to be over a staged and lengthy period (at least 10 years)

Vital's 2-year progression despite COVID-19 (cont'd)

BALANCE SHEET STRENGTHENED

NTA PER UNIT

$2.36$3.12

20192021

32.2%

growth

BALANCE SHEET GEARING

35.1%33.2%

20192021

Conservative gearing maintained

AFFO (PER UNIT)

10.45111.902

FY20FY22

13.9%

growth

AVERAGE DEBT DURATION

1.7 years	4.4 years3
2019	2021

Significantly expanded

DISTRIBUTIONS (PER UNIT)

8.7519.752

FY20FY22

11.4%

growth

Balance sheet strengthened through raising $351m of new equity and extending debt whilst supporting portfolio growth as a means to grow AFFO and distributions

1 FY20 actual
2 FY22 upgraded guidance (annualised)
3 Pro-forma as at 31 December 2021 including terms agreed post- 31 December 2021	VITAL HEALTHCARE PROPERTY TRUST  |  INTERIM RESULTS 2022  |  5