Vital Infrastructure Property Trust · TSX:VITL.UN
Vital Infrastructure Property Trust — Northwest Healthcare Properties REIT — Q2 2024 Earnings Presentation
49 slides from Vital Infrastructure Property Trust's earnings presentation, Aug 14, 2024
Slide 1: Q2 2024 Financial Results Presentation
Northwest Healthcare Properties REIT Q2 2024 Financial Results Presentation TSX: NWH.UN August 14, 2024 Cambrian Centre, Canada
Slide 2: Presenters and Contents
Presenters Contents Craig Mitchell CHIEF EXECUTIVE OFFICER Northwest & Healthcare Real Estate 4 Results (Proportionate basis)(1) 6 Highlights & SRC Achievements 7 Stephanie Karamarkovic CHIEF FINANCIAL OFFICER Q2 24 Financial Performance 9 Q2 24 Property Performance 15 Q2 24 Capital Management 18 Mi
Slide 3: About Northwest
Hutt Valley Health Hub, New Zealand Hospital Santa Helena, Brazil Prins Hendriklaan 376, Netherlands About Northwest Northwest Healthcare Properties REIT (TSX: NWH.UN) owns, manages, and develops real estate exclusively focusing on tenants who are operators in healthcare, research, life sciences and
Slide 4: Why Invest In Northwest?
Albert Schweitzerplaats (Building W), Netherlands Australian Red Cross Blood Service, Australia Caxias Hospital, Brazil Why Invest In Northwest? 1 High quality globally diversified healthcare real 4 Investor, tenant and operator relationships provide estate portfolio. long-term revenue stability. 2
Slide 5: Why Healthcare Real Estate?
Why Healthcare Real Estate? Northwest focuses on the cure segment of the healthcare real estate spectrum, a defensive asset class that provides attractive risk adjusted returns, driven by an aging population. Growing Growing need Sustained Shift of care to Increased M&A Transition demand for for lif
Slide 6: Results
Australian Red Cross Blood Service, Australia Results NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 6
Slide 7: YTD FY24 Highlights
Bowen Hospital, New Zealand YTD FY24 Highlights $1.3B ~810k sf of non-core asset sales & sale of of new and renewed leasing, unlisted securities in YTD FY24(1) (negotiated or completed)(3) $1.1B 3.5% Total debt repaid (including $873M SPNOI growth for Q2 24 over the since Q1 24) comparable prior yea
Slide 8: Accomplishments of Strategic Review Committee
Schmilauer Str. 108 & Röpersberg 45/47, Germany Accomplishments of Strategic Review Committee $1.5B 46 6.5% $1.2B TOTAL PROPERTIES BLENDED CAP DEBT PROCEEDS(1) SOLD RATE REDUCTION Actively managed debt maturities in advance of asset sales. “The management team, in collaboration with the Board, remai
Slide 9: Q2 24 Financial Performance
Macarthur Health Precinct Stage 1, Australia Q2 24 Financial Performance NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 9
Slide 10: Q2 2024 Financial Snapshot
Barrie Primary Care Campus, Canada Q2 2024 Financial Snapshot (consolidated basis, pro-forma UK portfolio sale) June 30, December 31, Financial Highlights Variance $ Variance % 2024 2023 Assets Under Management 8.4 9.9 (1.5) (15.2%) Gross Book Value(1) 6.3 7.6 (1.3) (17.1%) Debt(1) 2.7 3.6 (0.9) (25
Slide 11: Proportionate Income Statement (three months ended June 30)
Proportionate Income Statement (three months ended June 30) 3.5% June 30, 2024 June 30, 2023 Proportionate Basis Change SPNOI growth(3), offset by C$ Millions Proportionate Basis(1) Proportionate Basis(1) ($) (%) impact of investment property dispositions in FY23 Net Operating Income 81.9 85.1 (3.2)
Slide 12: Proportionate Income Statement (six months ended June 30)
Proportionate Income Statement (six months ended June 30) June 30, 2024 June 30, 2023 Proportionate Basis Change C$ Millions Proportionate Basis(1) Proportionate Basis(1) ($) (%) Net Operating Income 165.2 167.4 (2.2) (1.3%) Management Fee Income(3) 21.7 24.9 (3.2) (12.8%) 4.3% SPNOI growth(4), offs
Slide 13: Proportionate Balance Sheet
Proportionate Balance Sheet June 30, 2024 December 31, 2023 Proportionate Basis Change C$ Billions Proportionate Basis(1) Proportionate Basis(1) ($) (%) $1.3B Investment Properties(2) 4.3 5.7 (1.4) (24.8%) Completed non-core sales during YTD FY24, including Other Assets 0.5 0.4 0.1 (31.3%) $36m of u
Slide 14: NAV Bridge (QoQ)
NAV Bridge (QoQ)(1) $175M ~$30M $6M Property revaluation loss for Transaction costs & disposition Net reduction from AFFO, the quarter losses distributions and DRIP $ 10.36 ( 0.71 ) Global ( 0.11 ) ( 0.03 ) ( 0.05 ) $ 9.46 Manager 1.72 1.72 8.65 7.75 Q1 2024 FV Adjustments to IP Transaction Costs &
Slide 15: Q2 24 Property Performance
Hospital Caxias, Brazil Q2 24 Property Performance NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 15
Slide 16: Net Operating Income Bridge
Net Operating Income Bridge ($M)(1) 3.5% $1.2M Divestment of Over 85% of non-core assets in Northwest’s rents SPNOI growth vs. prior Of additional development line with strategy are indexed comparable period(1) income 1.2 0.0 90 2.4 6.7 85.1 0.2 0.1 81.9 80 70 60 50 Q2-2023 SPNOI Developments Acquis
Slide 17: 1H 24 Leasing Achievements
Hospital e Maternidade. Brazil 1H 24 Leasing Achievements Lease expiries & early Region Lease Renewals (sf) Retention % New Leases (sf) terminations (sf) North America (167,845) 113,790 67.8% 20,042 Brazil - - 0.0% - Europe (474,658) 394,531 83.1% 69,344 ANZ (98,514) 87,275 88.6% 125,313 Global (741
Slide 18: Q2 24 Capital Management
Hospital Santa Luzia, Brazil Q2 24 Capital Management NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 18
Slide 19: Debt Maturity Profile
$873M Remaining debt maturities to be addressed through normal Debt Maturity Profile Total debt repaid since Q1 2024, course refinancings and including $780M of 2025 maturities, proceeds from asset sales at an average rate of 7.6% Northwest’s debt maturities as at June 30, 2024(1). 1,600,000 9% 1,40
Slide 20: Interest Rate Hedging Profile
Interest Rate Hedging Profile Cost of Debt is well hedged, managing risk. HEDGING MATURITY PROFILE(1) June 30, December 31, Rates 1,000 6.00% 2024(1) 2023 900 Weighted Average Variable Debt 6.85% 7.85% 5.00% 800 Weighted Average Imterest Rate Weighted Average Fixed Rate (incl. 700 5.39% 5.54% 4.00%
Slide 21: Property Portfolio Overview
Ormiston Private Hospital, New Zealand Property Portfolio Overview NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 21
Slide 22: UK Portfolio Disposition
Cancer Centre London, UK UK Portfolio Disposition UK Portfolio Background 14 62k 507 36 Hospitals GLA (sqm) Beds Theatres Prior to Disposal To maximise proceeds, Northwest renewed lease terms on six Circle Healthcare assets, increasing the WALE from ~9yrs to 25yrs and transferring operations of on
Slide 23: Total Dispositions
Total Dispositions Disposition Proceeds ($M) YTD FY24, the REIT has achieved Region Period Proportionate Consolidated the following: Investment Properties North America Q2-24 139.8 139.8 Australasia Q2-24 20.8 73.0 Europe Q2-24 20.6 20.6 $1.2B Fair value of total investment properties sold TOTAL – Q
Slide 24: Global Portfolio Overview
Global Portfolio Overview Global Summary 186 12.9 16.1M 96% $8.4B PROPERTIES WALE (YRS) GLA (SQFT) OCCUPANCY AUM BRAZIL CANADA USA NETHERLANDS GERMANY AUSTRALIA NEW ZEALAND 8 Properties 48 Properties 15 Properties 16 Properties 38 Properties 47 Properties 14 Properties 16.1 WALE (YRS) 5.3 WALE (YRS)
Slide 25: NOI Is Strongly Diversified By Regions & Asset Mix
NOI Is Strongly Diversified By Regions & Asset Mix(1) Income from stable rent collections and long-term leases. REGIONS ASSET MIX Life Sciences 99% 1% North Brazil America 21% 38% MOB Collections Rate 4th consecutive year Hospital and 42% of >98% collections Healthcare Europe Facilities 16% 57% >85%
Slide 26: Lease Maturity Profile
Lease Maturity Profile(1) 90% 80% 70% Lease maturity in 60% Brazil attributed to Hospital Sabara 50% (Sep-24). Terms being finalised. 40% 30% 20% 10% 0% 2024 2025 2026 2027 2028 2029 2030 2031 Thereafter North America Brazil Europe Australasia Total 2024 2025 2026 2027 2028 2029 2030 2031 Post 2031
Slide 27: Sustainability Report
RDX Development, Australia Sustainability Report Northwest released its third ever sustainability report for the previous year Notes from the CEO We are committed to upholding the high standards of ESG performance and governance ensuring that sustainability remains integral to our long-term success
Slide 28: FY24 Outlook
Springbank Medical Centre, Canada FY24 Outlook NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 28
Slide 29: In 2024 and into 2025, the REIT's focus will be continuing to:
Sportsmed Hospital, Clinics & Consulting, Australia In 2024 and into 2025, the REIT’s focus will be continuing to: 1 Explore opportunities to surface embedded value from within our portfolio 2 Strengthen the balance sheet and become an institutional quality REIT 3 Simplify our geographic footprint,
Slide 30: Northwest Healthcare Properties REIT - Summary
Glenmore Professional Centre, Canada Northwest Healthcare Properties REIT - Summary Ticker NWH.UN Listed Exchange TSX Distribution Payable (C$) $0.03 / Monthly Unit Price(1) $5.05 Market Capitalization (C$)(1) $1.24 Billion Distribution Yield(1) 7.17% 52-Week Trading Range(1) $3.89-$7.21 Volume Weig
Slide 31: Contact Information
Eating Recovery Center, U.S Contact Information Craig Mitchell, CEO craig.mitchell@nwhreit.com Mike Brady, President mike.brady@nwhreit.com Stephanie Karamarkovic, CFO stephanie.karamarkovic@nwhreit.com Alyssa Barry, Investor Relations alyssa.barry@nwhreit.com 604-997-0965 NWH REIT NWH REIT | Q2 |20
Slide 32: Disclaimer
Disclaimer This presentation provides a summary description of Northwest Healthcare Properties Real Estate unchanged (including exchange rates remaining constant, local real estate conditions remaining Investment Trust (“NWH” or the “REIT”). This presentation should be read in conjunction with and i
Slide 33: Appendix
Hospital Santa Helena, Brazil Appendix NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 33
Slide 34: Proportionate Income Statement (three months ended June 30)
Proportionate Income Statement (three months ended June 30) June 30, 2024 June 30, 2023 Proportionate Basis Change C$ Millions IFRS Basis Adjustments(1) Proportionate Proportionate Basis(1) Basis(1) ($) (%) Net Operating Income 94.0 (12.1) 81.9 85.1 (3.2) (3.8%) Management Fee Income(2) 3.4 7.7 11.0
Slide 35: Proportionate Income Statement (six months ended June 30)
Proportionate Income Statement (six months ended June 30) June 30, 2024 June 30, 2023 Proportionate Basis Change C$ Millions IFRS Basis Adjustments(1) Proportionate Proportionate ($) (%) Basis(1) Basis(1) Net Operating Income 189.4 (24.2) 165.2 167.4 (2.2) (1.3%) Management Fee Income(2) 7.2 14.5 21
Slide 36: Proportionate Balance Sheet
Proportionate Balance Sheet June 30, 2024 December 31, 2023 Proportionate Basis Change Proportionate Proportionate C$ Billions IFRS Basis Adjustments(1) Basis(1) Basis(1) ($) (%) Investment Properties(2) 5.4 (1.1) 4.3 5.7 (1.4) (24.8%) Other Assets 0.9 (0.4) 0.5 0.4 0.1 (31.3%) Total Assets 6.3 (1.5
Slide 37: Northwest's Strategic Healthcare Property Platform
Northwest's Strategic Healthcare Property Platform Core Preserve, Build and Grow Competencies Investment Development Asset Management Management Management Wholly Owned Fee By The Reit Generating Funds Management JV’s INVESTMENTS Direct Property Unlisted Ownership Public Institutional Companies JVs
Slide 38: Deep Connections With Key Operating Partners
Deep Connections With Key Operating Partners Northwest has deep relationships with the biggest brands in health and health sciences across its regions. NWH REIT | Q2 2024 FINANCIAL RESULTS PRESENTATION | 38
Slide 39: Development Strategy (Vital Healthcare Property Trust)
Development Strategy (Vital Healthcare Property Trust) Northwest has a market leading development team in ANZ with an unmatched depth of experience. Meeting the needs of our Earnings and capital growth Enhancing the portfolio operator partners PIPELINE1 FOCUS NZ $356m ~NZ$138m of spend remaining of
Slide 40: Top 10 Tenants
Top 10 Tenants The REIT’s 10 largest tenants for the three months ended June 30, 2024. Top 10 tenants represent 37.7% of Proportionate Rent The REIT's five largest tenants include: Tenant Region % # of locations 1 Rede D'Or, Brazil: The largest integrated health care network in Brazil 1 Rede D'Or Br
Slide 41: 2023 GRESB ESG Real Estate Assessment
2023 GRESB ESG Real Estate Assessment Globally Listed Standing Investments 1ST Place 2ND Place Healthcare: Benchmark Development 1ST Place 2ND Place Benchmark Global Healthcare Development 1ST Place 3RD Place (Listed & Unlisted): Benchmark 4-Star ESG 4-Star ESG Rating Rating Northwest believes ESG B
Slide 42: Case Study: Capital Lite Investment Strategy
Palm Beach Currumbin Clinic, Australia Case Study: Capital Lite Investment Strategy (Vital Healthcare Property Trust) Leveraging our experience to increase value: Asset-lite business models have been associated with better return on assets, lower profit volatility and greater adaptability in an ever
Slide 43: Case Study: Vital Healthcare Property Trust
Case Study: Vital Healthcare Property Trust (NZX:VHP)(1) Northwest owns a ~28.5% interest in the only specialist healthcare landlord on the NZX and retains 100% of the management rights. NT 2 2 ~C$0.8bn QLD 14 PROPERTIES 3 (NZ) WA SA 8 NSW Royston Hospital, New Zealand 12 ~C$1.8bn VIC 7 Vital has As
Slide 44: Case Study: Commitment to ESG
Macarthur Health Precinct Stage 1, Australia Case Study: Commitment to ESG Completion of targeted 6-star Green Star rated building Project Overview Northwest Healthcare Properties, as manager of Vital Trust, acquired the development rights for a ~6.9acre site in Sydney, Australia (2022) A master
Slide 45: Case Study: Jerry Coughlan Health & Wellness Centre
Jerry Coughlan Health & Wellness Centre, Canada Case Study: Jerry Coughlan Health & Wellness Centre Project Overview Design and construction of a purpose built, four-storey medical office and ambulatory care hybrid facility, comprising 67,300sf of healthcare accommodation 4 high volume operating
Slide 46: Case Study: Epworth Healthcare, Melbourne Australia
Case Study: Epworth Healthcare, Melbourne Australia Northwest has supported Epworth for over 15+ years with expansion opportunities, advice and capital. Developments have added to the quality and value of assets, driving operational benefits and efficiencies that attract practitioners. Not-for-pro
Slide 47: Experienced Management Team
Experienced Management Team Craig Mitchell, CEO Tracey Whittall, COO Craig Mitchell has more than 20 years’ experience Prior to joining Northwest in 2024, Tracey specializing in the property industry in Australia. His was COO at Flexiti, a leading financial services company previous roles include Ex
Slide 48: Experienced Board Of Trustees
Experienced Board Of Trustees Northwest's strong governance framework ensures diversity is considered in determining optimal board composition. Northwest's experienced Board of Trustees functions independently of management, Dale Klein Peter Aghar Graham Garner Bobby Julien ensuring effective Non-Ex
Slide 49: Non-IFRS Measures
St. John of God Hospital, Australia Non-IFRS Measures 1. FFO 2. AFFO 3. FFO per Unit 4. AFFO per Unit 5. AFFO Payout Ratio 6. EBITDA 7. Adjusted EBITDA 8. Investment Properties on a Proportionate Basis 9. Proportionate Management Fees 10. Distributions 11. Net Asset Value (“NAV”) 12. Net Operating I
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