Primary Health Properties has warned that it is going to take a £2.8m hit to its profits because of movements in the group’s interest rate swaps.
In a trading update issued ahead of it preliminary results due in April, the healthcare facilities provider warns that yields in the sector have weakened by 35 basis points since 30 June 2007.
This trend will be reflected in its December valuations, which are still being finalised.
The group’s portfolio of 107 properties, including eight contracted schemes, is almost 100% let – the majority to the NHS – with an average lease length outstanding of 18.36 years.
The rent roll for the year ended 31 December was £16.1m, compared to £14.5m for the year before, with the increase mostly due to new deliveries with a small part attributed to rental increases over the year.
A further £50m debt has been secured by the group, taking its total to £250m which will be used to fund further acquisitions.
The board proposes to pay a third interim dividend of 8.25p per share which is up on the previous two interim dividends of 7.5p.
