Assura (OTC:ARSSF) — Year End Results

0:01 Good morning, ladies and gentlemen, and welcome to the ASSURA PLC Year End Results Investor Presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged. They can be submitted at any time using the Q and A tab situated on the right hand corner of your screen. Just please simply type in your questions at any time and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so.

0:28 Before we begin, we'd like to submit the following poll, and we'll be grateful for your participation. And I'd now like to hand over to CEO, Jonathan Murphy. Good afternoon or good morning to you, sir. Good morning, and welcome, everyone, to ASSURA's results presentation. So I'm joined today by, Jane Cosman, our CFO, who will take you through our financial and strategic highlights, and also Patrick Rather, our head of strategy and markets, to take you through, the activity from the property side of the business today.

0:58 So in terms of in terms of progress over the year, delighted to say that we have seen strong progress across all areas of the business. This is notwithstanding, you know, a challenging backdrop with significant disruptions from ongoing implications of COVID and also some some issues with with inflation and supply chain challenges. Yep. Notwithstanding that, we've been successful in terms of deploying capital at at very good rates into the market. We've also been moving into the new areas that we've highlighted to you before. So we've successfully completed transactions across all of the areas that we've previously highlighted, and Patrick will take you through some really exciting examples of of activity across that area. And all of this has been made possible by two very successful fundraisers in the capital markets. So we we issued a sustainability bond back in July, and then we completed an equity raise in November, which will come on and talk to you about the progress that we've made in delivering against those plans.

1:57 But last but not least, we've also significantly updated our sustainability plans by highlighting our commitment to a a net zero future highlighting the work that we've done in terms of moving those those plans forward. So just starting with our activity in the capital markets, we had two significant transactions. The first was a £300,000,000 sustainability bond. This followed on from the very successful social bond that we launched last year. Delighted to say that we were we saw great response from investors three times oversubscribed, and we were able to raise £300,000,000 at a twelve year coupon of just over 1.6%. So really fantastic, business from our side, you know, and a real testament to Jane and the team for being able to deliver on such a strong transaction.

2:49 We also entered the equity markets in November with an £185,000,000 equity raise. And, again, pleased to say that we were oversubscribed. And together, those have set us up in terms of the resources that we need to continue to deliver on our plans. And those plans are proceeding ahead of schedule with a £152,000,000 of property acquisitions already completed in the second half of last year. That's more than 50% over our target. And we continue to see significant further opportunities with strong pipelines both in acquisitions and in developments. All of this adds up to an attractive level of activity with £271,000,000 deployed at an average yield on cost of 4.6% and an average worth of of nineteen years.

3:37 In terms of these new areas, these are I've highlighted these to you before. We've seen good progress across all of these. So we've been active across all of these areas and seen opportunities in our pipelines that also support these activities. So the first one was around NHS Trust and diagnostics. We've made good progress in the year, secured some really exciting opportunities with the NHS Trust in in Cranmington in the Northeast. We've completed a deal with the West Midlands Ambulance Hub, and we continue to see further opportunities which we'll come on and and talk to you about in more detail. Mental health is a natural area for us for for potential growth. We see this as a natural extension of our of our capabilities and, activities in primary care, moving into mental health to support the physical infrastructure required to support the NHS in delivering a high standard of of services across this area. We've done a number of deals this year, and we continue to see new opportunities.

4:37 So, again, one that we'll continue to give you more information on. The next area is primary care at scale. So this is collective groups of GPs. So where instead of dealing with an individual GP practice, we are dealing with a group of 10 or 15 practices who've come together. And our our skill set can help them in in supporting their property requirements, looking to deliver the future space needs that they might have and reconfiguring and and and reengineering their existing portfolio, so wherever we can to support them. So this is quite an exciting area for us. It gives us the opportunity to operate at scale, and it's somewhere where I expect we'll see significant growth going forward. The next image on the slide is for independent sector health. So this is the image you can see there is a facility we've delivered for for Ramsay Healthcare in Preston. It's a day case surgery unit delivering extra capacity for the NHS but operated by Ramsey HealthCare rather than the NHS directly.

5:40 It's a key part of the overall solution

5:43 to helping us clear the backlog in care and, again, is an area where we continue to see further opportunities. We're currently on-site with a further facility in in Kettering, and Patrick will come on and talk to you about some other opportunities that we're seeing in this space. And last but not least is our entry into the Irish market. This is an area we've been monitoring for many years, and I'm delighted to say we've made our first acquisition. And this an image you can see there on the screen is from Castlebar, a €14,000,000 integrated health care center that we acquired earlier on the year, and we're currently working on plans to extend and enhance that facility.

6:24 Now I referenced before the fact that we'd updated and enhanced our net zero credentials. So as many of you will know, we have a six by six plan, which was to deliver our six pledges by 2026. This predominantly focused on our our commitment to EPC improvements and also to deliver net zero development plans. Delighted to say that we're now updating that. We've now got a target for 2040 for the whole portfolio to be net zero. That's building on our existing work and the plans that we have in place to 2026 to then take it through to the next level, which will be full net zero operationally by 2030 and then fully net zero by 2040. This last target will include all of our GP customers and ensuring that they are operating at net zero as well. So a really significant challenge, but one that we feel is the right target to to aspire to. It supports the NHS and its overall ambitions and reflects the need for us to take this issue very seriously as a business.

7:29 Social impact, as you know, is is a really key part of our activity as well, and we we've seen the ASSURA community fund pass the milestone of more than £1,000,000, distributed to the good causes and health and wellness activities, you know, associated with our buildings. This is a fundamental part of our strategy. The social impact and sustainability focus is the right thing to do, but also is supporting of the overall objectives of the NHS. And so ultimately underpins our commercial success, which has been demonstrated clearly by our ability to drive earnings growth of more than 7% on average over the last six years. So now I'd like to pass over to Jane to give you the financial and strategic update. Jane?

8:16 Thank you, Jonathan. So if we just look at the performance for the last financial year to the March 31, you see we had a very strong year where earnings growth has been driven by our acquisitions and our developments. At a top line level, our net rental income growth was 13%. At an EPRA earnings level, this was 14%, and that translated into an earnings per share of 11% increase year on year. We increased the dividend by 4% over the year, and we have announced a dividend increase of 5.4, from July onwards. I'm just taking a moment to look at the balance sheet. The portfolio is now £2,800,000,000, an increase of of 12%.

9:04 Our portfolio net initial yield is 4.48% for an average unexpired lease term of eleven point eight years. And our net tangible asset per share has increased by 6%, year on year, reflecting some valuation growth, of a 10 basis points movement in our yields to the 4.48%, a £69,000,000 valuation gain. Our loan to value is now 36%, and I'll come on to talk to, to our finance and capital structure in a moment. So this slide just shows, what's happened to our portfolio over the last five or six years. So you can see we've grown from 1,100,000,000 back in March 2000 and March 2016 to 2,800,000,000, as we are today, which is a compound annual growth rate over that period of 16%.

9:57 And in the year, our rent roll has gone from a 121,700,000 to a 135,700,000, and the majority of this has come from our acquisition program. We've had 2,200,000 on our rent reviews, 1,500,000 from our development completions, and we had a few disposals in the year.

10:21 We have a very conservative balance sheet. As I spoke, I said that we have a a loan to value of 36%. We've been operating, with a more conservative balance sheet for a number of years now. What that's enabled us to do is enabled us to move our financing from secured to unsecured, and it's enabled us to get an a minus rating from Fitch, which has given us the ability to access the public bond markets at very attractive rates. So the top line on the graph there is showing our portfolio net initial yield. And over the period, we've come down just over a 100 basis points, Whilst at the same time, the bottom line on the graph is showing our average interest rates on our debt, which is now down at 2.3% as an average.

11:08 But, latterly, our last bond issue last summer was a twelve year sustainability bond, and that was issued at 1.625%. And the previous bond the year before was issued at one and a half percent. Now all of our debt is fixed. It is long term, and we have come into this financial year with strong cash reserves following both the debt and the equity raise last year. Therefore, we have a hedge in the short to medium term about any external interest rate, pressures.

11:44 So this just highlights where we've come over the last few years. You can see our loan to value, has come from almost 50% to the 36%, where it is now, and our average interest rate was over 5% and is at the 2.3%. In terms of that loan to value of 36%, we are comfortable in and around 40%. That is the guidance that we give. We are happy to go above 40%. We are able to go above 40%, and the rating supports that. However, we would expect to bring it down over time. And just to give you some context, 40% is headroom of 205,000,000, and 45% is headroom of 485,000,000. So we've got plenty of headroom for all of the ambitious plans, that we have, for the year ahead.

12:32 In terms of, interest rate hedging, as I've mentioned, all of our debt is fixed. We came into the year with cash of £240,000,000 as well as a disposal portfolio of £75,000,000. So we've got some capital recycling in there. Therefore, we've got plenty of headroom to support the plans that we have for the year ahead. And in terms of facilities, we still have an undrawn banking facility of a £125,000,000 that we are able to tap into. So we have no capital requirements at this time.

13:10 So I want to just talk you through, our rental growth and our rent review results for the year. So our annualized uplift over the year averaged 1.9%, 2.7% were RPI fixed or other uplifts, and 1.4 were open market reviews. The graph on the right there is showing you the absolute increase we've had over the last few years. We've had a bit of a backlog, open market reviews of those which are negotiated with the NHS. And as you can appreciate, this has taken a little longer to get through than than previously. However, we had some really good success in the last quarter as we've looked at at our internal processes, and we've worked much more closely with the NHS to get these reviews through.

13:55 And we've managed to get an absolute uplift of 2,200,000 on, 38,000,000 of our rent that's been reviewed, which is an absolute amount of 5.2%, for the year. So we're very pleased with that result.

14:11 And this slide is just taking you through our rent review process. Our rent, 65% of them are on open market, reviews. 35% of them are RPI fixed and other uplifts. But if we take the open market rent reviews, they typically take nine to eighteen months to complete. We talk about our rent reviews having a linkage to construction cost inflation, and this is because we negotiate all of our developments on an open book, approach with the NHS, and they determine the rent on that, placing a yield on those costs. And that then sets the new tone for other rents on medical centers in that area. So we need the new developments to come through to provide the evidence, which we then will see filter through over time into our rental, uplifts.

15:07 So at the OMR, rent review date there, it's about nine to eighteen months. We, negotiate with the district valuer who works for HMRC and, is in there, to ensure that everything is valued for money for the taxpayer. Our team, provide evidence for that uplift and decide whether we want to, instigate the review, and this takes a a time to to complete in the NHS and agree the rent with the district valuer. We do have the option to challenge the rent if that is what we wanted to do. It's something we do very rarely. We've got one going through at the moment, but occasionally, we will do that. The new rents agreed and any back rent from the date of the review will be settled at that point in time. Guess the point I'm making here is that we do capture the construction cost inflation.

15:56 However, it just takes a little bit of time. And on that construction cost inflation, here are a couple of examples of of how we've managed to capture rental growth through that build cost inflation. So if we take the scheme at the top there, East Anglia, we developed a scheme there in 2013, and that was £2,000 a square meter on the build costs. Fast forward to 2022, it is now £3,500 a square meter. So there's been a 75% increase in the build costs over that period. However, from a rental perspective, we have been able to capture a 40% increase in the rent. Now you will ask why did we not capture the full 75%, and that is because our portfolio net initial yield has moved over the over time. And you can see there we've seen yield shift of a 150 basis points and, the district value as a surveyors who work for HMRC, and therefore, they are aware of this yield shift and will apply that.

16:57 However, that £225 is a great result because that then sets the tone for new rents in that particular patch on any existing buildings that we have. And again, a scheme there in in South Wales, it's been particularly difficult to get rental growth, in South Wales, so we're very delighted that we've managed to capture 26 uplift, in rents there, and that will definitely set a new tone, for rents in that area.

17:28 I'm just gonna hand over to Patrick now who'll take you through the property update. Patrick? Thank you, Jane. Good morning, everybody. So in my sector, I just wanted to give you a bit of a a bit of a flavor and a bit of color as to some of the emerging areas that we've been been looking at over the year. Jonathan and Jane have mentioned the general activity across the portfolio. As you can see, we we've we've acquired effectively 47 assets through investment and development activity, which has been really positive. We've also looked at recycling capital, and Jane mentioned the portfolio that's held for sale. So we've been working the portfolio at both ends, and we've also been looking at creating value through investing around ESG, future proofing the portfolio, extending leases, and working assets with our customer base, be they extensions or be they sort of repositioning and future proofing around new ways of working.

18:24 If I if I just wanted to summarize sort of three key themes, which I draw out in this presentation, it was really around the natural evolution from our primary care portfolio and looking at some of those adjacencies and some of the relationships we develop on a day to day basis. The first off that I'll cover is is within the trust sector. The second part is within the independent sector, as Jonathan sort of alluded to. And the third area, I'd like to cover, is our first acquisition into Ireland.

18:55 Now the the emerging opportunity around trusts, we think, really plays to our strengths in terms of we're looking at taking services out of the sort of traditional hospital setting and either setting them in the community on the edge of the hospital estate. We think it plays to our expertise. We've we've we've developed over recent years in terms of the development of assets, but also the management of assets. The two opportunities highlighted here, one is a new ambulance hub, which will serve effectively five and a half

19:26 million population within the West Mids area, best in class facility moving the existing ambulance service away from outdated infrastructure. We're really trying to support those challenging response times where the NHS has a so response target of about seven minutes for ambulances. As we've been consistently hearing, this has been going up to sort of hours and and and longer. So we think it's a a critical part of infrastructure, a good long lease with an inflation back characteristics. The second opportunity here is is some work

19:57 we've been doing up in Northumbria with with the trust up there around a new education and training facility, which effectively be an 80,000 square foot best in class building, which really placed the trust's ambition of attracting and retaining and developing their staff at a time when across the NHS were effectively some 40,000 vacancies for nurses and 8,000 vacancies for doctors. So, again, a really important bit of infrastructure, and I think it it, again, it plays to the strengths that we've been developing in recent years. The third opportunity, again, this time with a trust in in South London working with King's College. Again, they've moved their r and d team, their executive team, and their team out of a very busy hospital estate into a brand new refurbished building. So whilst this obviously looks like something from the Victorian area, inside offers that flexible, efficient, bright, open space, a very high ESG characteristics.

21:01 And it really plays to attracting and and helping them again retain a young mobile professional workforce. So we think it's an interesting opportunity, again, secured by a long lease with the inflation backed characteristics. So it's a really, really core defensive opportunities, which put us in a seat with these decision makers going forwards where we're already in conversation with similar opportunities where we can potentially play more of a direct role going forwards. The second emerging area for us, which we've been sort of working in recent years is is working with the independent sector. You will know that the backlogs and the waiting list within the whole health system have grown to a sort of unsustainable level.

21:49 And during COVID, three million NHS patients were treated at cost by the sector.

21:55 So we think we have a role to play sitting in between an NHS trust and independent sector, bringing the two together and creating first class infrastructure. An example highlighted here on this slide is working with Genesis Cancer Care, one of the leading oncology operators across the globe actually, and formed they formed an initiative partnership with the Surrey NHS Foundation Trust where they're delivering services to both public and private patients, again, to try and reduce the backlog.

22:30 Now coming on to Ireland, we've been monitoring activity in Ireland since 2018 when the Irish state announced their sort of bold launch of care ambition, which is very much about updating their primary care infrastructure, again, moving services out of a hospital setting into the community. And they've got a very strong published ambition around doing this over the next ten years. We had the opportunity to enter the market with our acquisition of an asset in Castlebar, which we think is a a really exciting opportunity whereby it's an award winning building. It's received verbal consent for a for an extension which effectively doubles the building to gain accommodate further services out of the hospital setting and puts us in a really strong position within the our issue of narrative at the moment around how the rollout of primary care facilities like this can be accelerated.

23:24 And we're having conversations with the HSC where we're falling back on all the expertise we've been generating in The UK and looking at how we can share that with the HSE, particularly around our net zero carbon ambitions. And, equally, we're taking learnings back from Ireland we can apply in our in our in our UK market. So we think it's a really natural evolution, and I'm particularly excited about driving further momentum in this space going forwards.

23:50 So, really, that's a quick summary. I'd now like to hand you back to Jonathan. Thank you. Thanks, Patrick. So just now turning to the outlook and what we're seeing in the market. So this slide gives you an overview of how the valuations for our has has has developed over the last fifteen years. So you can see that the the net initial yield on our portfolio has continued to come in slightly and therefore resulting in further capital gains for our portfolio. You'll have seen that in terms of strong net asset value growth this year. And we ended the year at a 4.48% net initial yield on the portfolio for an overall valuation of just under 3,000,000,000, as Jane has already mentioned.

24:39 Now this reflects a further increase in values. That reflects the fact that we see continued strong demand for health care as an asset class, not only ourselves, but a number of other people are also bidding on assets, and we're continuing to see further appreciation in values and further interest in the sector. I think that reflects the the overall defensive and resilient characteristics that that the government backed income and the long leases provides. And in what is now clearly quite a an uncertain world in terms of economics and and business backdrop, you know, ASSURA represents quite a quite a safe haven and a resilient place for for people to to deploy capital. Underpinning all of this, of course, is the underlying requirement for the need to invest in the NHS. You probably have read many articles about the extensive waiting list that people are currently suffering. Know, six million people are currently waiting for treatments on the NHS. That's an all time high.

25:41 And this is one of the things that has contributed to that is just the lack of capacity in the system. And one way of of improving that capacity would be for more investment to be made not only in hospitals, but into the community estate and the type of assets that ASSURA delivers, which provides its essential capacity for additional services and treatments to be done in a community setting closer to people's home in a in a venue that is cheaper for the NHS to operate and ultimately providing that all important contribution to trying to clear some of the backlogs on on those waiting lists. So in terms of the challenges the NHS is facing, what are we doing to try and help them? Well, clearly, part of that is by delivering on the 17 schemes that we've got, currently on-site, looking to build that that all important extra capacity in space for the NHS to deliver their services.

26:35 Also, it's about doing new things. I mean, Patrick's referenced some of our innovative work in some new areas where we're looking to deliver slightly different types of assets that support the wider health care infrastructure. So we'll continue to do that, and we continue to see very strong demand for that. The other thing we're seeing is the need for the buildings to evolve. So we can't stand still with our designs. We need to think about what the next generation of medical centres might need to involve. We we had a a project that we worked on a couple of years ago now called designing for everyone where we delivered The UK's first dementia friendly medical center. Centre. That type of innovation and fresh thinking is exactly what we need to make sure that the buildings that we're providing today will remain fit for purpose for many years to come.

27:23 Something else you might have read about is the move of the NHS to what they're calling integrated care systems. Essentially, this is basically hospitals, primary care, and social care getting together to work together collectively to try and address our health challenges. Any kind of joint up thinking along these lines has got to be positive for the NHS and has to be positive for us at ASSURA because it's it'll drive the need for further requirements into community space, which we're clearly very well placed to deliver. And all of that is responding to this underlying need of the NHS in terms of requirement for new space, and we'll continue to do that whether that's in diagnostics or surgery hubs or whether it could be in other areas as well as the traditional GP surgery. In terms of our growth prospects, we have a very strong development pipeline.

28:15 You can see here that we've got in excess of 500,000,000. This represents an all time high for the business in terms of opportunities that we're seeing. Very busy at the moment on-site with our 17 schemes, but we've got 20 schemes that are due to start within the next twelve months. This really reflects the significant work done over over the last three or four years to build up the development capacity and the development team for ASSURA. And this represents a successful growth in this opportunity and our our ability to source new deals, but also to deliver a high quality product to the NHS and therefore be available to win new business. Development isn't isn't the only part of the growth story, though. We also have our acquisitions. You can see here that we've got a pipeline of 119,000,000.

29:02 Those assets will typically acquire within about three to six months. So given that this is the pipelines at the end of March, you know, a good number of those transactions have now already completed. This represents very much a balanced growth strategy. So we will look to to continue to employ capital into our developments, but also to source new new acquisitions. And also the last one here on the slide is asset enhancement. So this is where we're adding a physical extension to a building, and this is, you know, really, really important and impactful work for for those buildings, but they're relatively small value. So that's why you see there 23 projects, but it's only £18,000,000 that that we're looking to deploy. And that just reflects the relatively modest scale those types of opportunities.

29:51 In terms of what that means to the overall shape, what this illustrates here is just how our overall income will grow over the next few years based on what we already know today. So this is this doesn't reflect any new opportunities. This purely reflects our ability from the current transactions that we're working on, what that would mean for investors. And you can see here that across the the areas of acquisitions, developments, rent reviews, and asset enhancements, we'd get close to a 170,000,000 for our income over the next few years. So effectively, from an investor's perspective, you have excellent visibility of the growth potential for ASSURA. So in summary then, so a very busy year in terms of raising capital, deploying capital, sourcing new opportunities, and all against what can only be described as continues to be a very challenging backdrop.

30:40 So a real a real credit to the team in terms of their ability to to continue to deliver great results in difficult times. The NHS estate is under even greater pressure than ever. The impacts of COVID, the backlog in treatments, the need for more capacity, the delays in the hospital investment plans. This is all highlighting the need for further significant investment into our community estate. We're obviously ideally placed to to support that. We've got the technical skills. We've got the team, and we've got the the capacity and the funding to deliver against those opportunities. So all in all, the as we look forward into the new year, you know, we we're delighted with the results and and the the success we've had in the year. But, also, crucially, we're starting the new financial year with very strong pipelines, having raised the money already. So I'm really pleased that we're not having to raise additional capital at the moment against a very volatile backdrop. So we have the funds in place to deliver on our plans and to support future growth. And, really, that's reflected in the announcement that we made with the results that we're increasing the quarterly dividend by 5.2% from the next quarter date.

31:48 Now that ends the the formal part of the presentation. So now we're very keen to receive as as many interactive questions as possible for any for anyone who'd like to submit them. A few have already been submitted, but if anyone has any further questions that they are considering, please do submit them online now, and we will we'll do everything we can to get through as as many of the questions as we can. That's great, Jonathan. Let me just jump in and give you a small break before we we look at those questions. And and ladies and gentlemen, please do continue, as Jonathan said, to submit your questions using the q and a tab situated. On the top right hand corner of your screen. Just please type in your questions and press send. But just while Jonathan, Jane and Patrick take a few moments to review those questions submitted already, I'd like to remind you that the recording of this presentation along with a copy of the slides and the published q and a can be accessed via your Investor Meet company dashboard.

32:39 Jonathan, I will bring up the cameras now and hopefully that's there. Jane, I will keep the camera off unless you wish to bring up yourself locally. But, Jonathan, if I may just hand back to you, and if I could ask you to read out the questions and give a response where it's appropriate to do so, and then I'll pick up from you at the end. Absolutely. Thanks. So so the first question is in relation to the Irish market. So I'll ask Patrick to respond to this. But the question is, how big an opportunity for ASSURA is the Irish market, and how much of the pipeline does it represent? So, Patrick, are you okay to fill that one? Yes. Thank you. I think we're always a bit cautious about giving giving to direct a figure when the government is involved in a in a sort of national program.

33:26 But just to sort of paint a picture, probably about fifteen years ago when they originally announced their intention to develop more of the primary care infrastructure, it was felt that there was about 500 new centers that were needed. That subsidy got scaled down to about 350 priority areas, and the agency would say they've delivered about a 150. Now these numbers are slightly debatable, but what we see is a clear opportunity, a clear narrative, and direction that they need to invest substantially in this. And we're seeing priority schemes coming forward, so that's positive. CBRE point towards the fact that you might require €22,200,000,000 worth of further investment for them to deliver on this ambition. So we're excited about that future pipeline. And with one asset, it's all about creating that momentum.

34:14 In terms of how much of that pipeline it represents in terms of what we've given you, I think it's right to say, Jonathan, that at the moment, you know, that pipeline is to one side. Yeah. Absolutely. Thanks, Patrick. So next question is in relation to our leases and inflation linkage. So question is, what percentage of your leases are fully inflation proofed, I e, without cap? So simple answer is it's it's 15%. So we have 21% of our leases that are RPI linked. But within that, we've got six with 6% with a cap. So, effectively, there's 15% of the overall portfolio that is uncapped RPI. Next question is in relation to assets held for sale. So what proportion of your current portfolio is currently held for sale? So the answer there is we've got £76,000,000 worth of assets that are currently held for sale. So on a portfolio of just under 3,000,000,000, what's that? That's about two and a half percent.

35:16 That 76,000,000 is a portfolio that we have extensively marketed, and we have a preferred bidder on that portfolio. And we're hopeful that we'll be completing the sale of that over over the coming weeks. So look look look forward to giving you a further update once we're in a position to do so. So 76,000,000 is what we've got as ASSURA's help for sale. So next question is about the market. So perhaps I'll ask Patrick to to pick this one up. So it's are you seeing any increased competition when bidding for new assets, and are you seeing therefore any impact on pricing? So so, Patrick, you okay to take that one? Yes. Thanks. It's it's a good question. I think the the answer really is that it's a balanced market.

36:04 Over the last four or five years, we see constant levels of competition, new entrants coming to the market, traditional investors recycling from some of the the mainstream areas of offices and retail and looking at coming into the into our space. I think the fact we acquired a slightly higher yield than we have done previously demonstrates we're still able to dig out opportunities off market. Some of the new areas come with a little bit of a of a sort of edge on the yield, but we see a balance at the moment, which we think is a really healthy environment with with buyers and sellers and a clear opportunity for us to keep growing. Great. Thank you, Patrick. So just just one final question to go. So if if you had any last last minute questions, do please submit them now. Otherwise, this this will be the final one. So last question is in relation to financing and whether we have any short term refinancing requirements over the over the coming years.

37:01 So so the short response there is is no. We've got an average debt maturity of eight years. The next significant amount of debt that we've got coming up is is not till 2025. So really pleased to say that we've got a very long term debt book and that that is a 100% fixed rate and an average interest rate of 2.3%. So so no no short term requirements for for any debt refinancing. Jonathan, as you say, you've very kindly taken those questions that we have from investors. And, of course, if any further questions do make themselves through to the platform, Jonathan, we'll provide you those after the event has finished. I know investor feedback is particularly important to the company, and I'll shortly redirect those on the call to give you their thoughts and expectations.

37:46 But before doing so, Jonathan, I wonder if I may just ask you for a few closing comments, and then I'll send investors to give you their feedback. Fine. Yeah. So so just we'd just like to say, you know, a big thank you for those of you you attending today to listen to the presentation. It's really important for us to be able to have the opportunity to to deliver the results in an open forum like this to the broadest possible audience. We're very keen to to deal with any any questions you might have and be as open and transparent as possible. So, you know, really delighted with your participation and contributions and and also delighted to be reporting on another strong set of results. And, hopefully, if there are shareholders on the call, you will remain happy ones for for many years to come. So thank you very much, everyone, for your time. Really appreciate it. That's great. Jonathan, Jane, Patrick, thank you once again for updating investors this afternoon. Can I please ask investors not to close this session as we'll now automatically redirect you to provide your feedback in order the company can really better understand your views and expectations?

38:42 This will only take a few moments to complete, but I'm sure it'll be very, pretty greatly appreciated by the company. On behalf of the management team of ASSURA PLC, we'd like to thank you for attending today's presentation. That now concludes today's session. I wish you all a very pleasant afternoon.