Assura Plc · OTC:ARSSF
Assura — FY2010 Earnings Presentation
25 slides from Assura's earnings presentation, Jun 29, 2010
Slide 1: Assura Group Limited Results Presentation
Assura Group Limited Results Presentation Year ended 31 March 2010
Slide 2: Refocused & Streamlined Business
Refocused & Streamlined Business • 75.1% of medical services business sold to Virgin Healthcare Holdings Ltd • Significant cost reductions with payroll alone reduced by £6.5m * • Reorganised management team with excellent property experience and track record * Gross payroll cost reduction between Ma
Slide 3: Significantly Improved Results
Significantly Improved Results • Revenues up 17% to £55.8m (2009: £47.6m) • Group trading profit from continuing operations up 156% to £13.3m (2009: £5.2m) • PBT from continuing operations £4.4m (2009: loss of £99.7m) • Our pharmacy business delivered a maiden full year profit of £3.9m*1 (2009: loss
Slide 4: Strong Property & Pharmacy Group
Strong Property & Pharmacy Group • Investment portfolio increased 12% to £313.7m at 31 March 2010 from £278.9m at 31 March 2009 • Gross rental income receivable at 31 March 2010 increased by 9% to £22.5m*1 • 84% of rent reimbursed by NHS & average lease length is 17.1 years • Property portfolio outp
Slide 5: Summary of Results
Summary of Results 2010 2009 £m £m Contribution - Operating profit before central costs Property Investment Property Development 18.7 (0.5) 13.4 (0.9) • Increased contributions from all divisions Pharmacy 1.0 (1.0) LIFT operations Total 0.0 19.2 0.0 11.5 • Central costs reduced very significantly Ce
Slide 6: Segmental Results
Segmental Results 2010 2009 £m £m Property Investment Gross income 23.4 20.4 • Growing rent roll Direct costs (2.4) (1.7) Gross profit 21.0 18.7 Administrative expenses (2.3) (5.3) • Stable direct property costs – opportunity Net Profit 18.7 13.4 for reduction Property Development Administrative exp
Slide 7: Balance Sheet Summary
Balance Sheet Summary 2010 2009 £m £m • Additions & revaluations in year partially offset Investment Property 313.7 278.9 Under Construction 27.7 54.8 by selected disposals Premises/held for sale/WIP 18.7 21.8 Investment in Assura Medical 5.5 4.8 • The 2009 investment in Assura Medical was that Inve
Slide 8: Property
Assura i Property www.assuragroup.co.uk 8
Slide 9: Medical Centre Investments Growth
Medical Centre Investments Growth • £332m portfolio, £22.5m rent roll*1, average net initial yield 6.02% • 84% PCT/GMS, 17.1 year weighted average lease length • £45m of medical centre developments on site at 31 March or due to commence imminently • Annual increase in rent from 68 reviews settled wa
Slide 10: Portfolio Summary
Portfolio Summary • Initial Yield 6.02% • Rent pa £22.5m • Reversionary Yield 6.61% • Market Rent (ERV) pa £24.8m (inc vacant space) • Equivalent Yield* (EY) 6.46% Capital Value No. of Investment Value Avge EY* Properties £m £0 – £500k 28 £7.6 7.99% £500k – £1m 14 £9.9 7.48% £1m – £5m 59 £135.6 6.72
Slide 11: Portfolio Summary
Portfolio Summary • 117 investment properties with 251 demised leases Income Type (£/pa) • Average property value: £2.8m • Largest property: 5.8% of portfolio value 3% 7% (North Ormesby £19.3m) 6% • Average GMS rent: £166 psm Income/Tenant split: 23% 61% • GPs: 61% • PCTs: 23% • Pharmacy: 6% • Healt
Slide 12: Good Development Pipeline
Good Development Pipeline • 5 on site at year end with an end value of around £38m • 1 commenced post y/e and 1 due to start with a combined end value of £7m • Identified potential pipeline beyond - £83m • Substantially pre-let with debt finance in place in advance • 15 land bank sites with a value
Slide 13: Excellent LIFT Investments
Excellent LIFT Investments • Major position in LIFT with 6 investments of 27% to 54% • £6.5m invested in 12% yielding loan stock • Equity stakes all expected to be profitable • LIFT consultancy generated revenue of £2.6m in 2009/10 and growing • LIFT consultancy separable from core property business
Slide 14: Pharmacy
Assura i Pharmacy www.assuragroup.co.uk 14
Slide 15: Profitable & Growing Pharmacy Business
Profitable & Growing Pharmacy Business • 33 predominantly health centre pharmacies • Expect to buy in 50% of GP Care for nominal consideration next year (7 pharmacies) • Stores maturing and revenue approaching £40m including GP Care • Targeting 5% EBITDA • We have the market-leading licensing team –
Slide 16: Profitable & Growing Pharmacy Business
Profitable & Growing Pharmacy Business • Compatible with Property business and can be valued independently • Steady store opening strategy (4 new health centre pharmacies opened last year and the next store opening in August) • Value growing (significantly enhanced license value growth) • Cash gener
Slide 17: Group Overheads
Assura i Group Overheads www.assuragroup.co.uk 17
Slide 18: Reduced & Competitive Cost Base
Reduced & Competitive Cost Base • Administration costs have reduced substantially (salaries alone by £6.5m) • Significant reductions have taken place close to the year end – full effects will be seen in the current year • Property management costs targeted to be <3% of rent • Corporate & central cos
Slide 19: Reduced & Competitive Cost Base
Reduced & Competitive Cost Base • Pall Mall and Daresbury one wing (50%) closed • Headcount reduced from 203 at March 2009 (excluding pharmacy branch staff) to 72 in May 2010 • The 72 includes pharmacy head office, LIFT consultancy, property management, property development and central staff (includ
Slide 20: Reduced & Competitive Cost Base
Reduced & Competitive Cost Base • Main Board - Reduced remuneration and two resignations • Executive Board (reduced to 5 from 7) – Nigel Rawlings, CEO – Conor Daly, Company secretary, legal & pharmacy licensing – Andrew Darke, Property – Tim Davies, Pharmacy – Elaine Siew, LIFT 20
Slide 21: Effective Debt Structure
Effective Debt Structure • Net debt of £232m • Less than £10m repayable before March 2013 • Banks have continued to lend on our assets throughout the credit crunch on competitive terms • Diversification of banks with Santander (NAB down to £135m from £190m) • Assura’s debt well hedged and competitiv
Slide 22: Dividend
Dividend • Group was profitable and cash positive excluding the medical services business (now sold) • Anticipate dividends will be reinstated in 2010/11 22
Slide 23: Strategy
Strategy • Property development the best means to grow the investment portfolio • Active management, shrinking voids and direct property costs and growing rents • Pharmacy now sustainably profitable and will be grown • REIT status under consideration (tax loss shelter in the mean time) • Land bank o
Slide 24: Summary & Outlook
Summary & Outlook • During the year we have refocused on medical property and streamlined the business • At the same time we have delivered significantly improved figures • We have made good operational progress underpinned by our strong medical property business and now profitable pharmacy business
Slide 25: Appendix - Timetable
Appendix - Timetable • 2nd March - Assura Medical sold • 31st March – Year end • 23rd April – Reorganisation completed • 29th June – Year end results announced • 9th September – AGM • 2nd half November – Interim results 25