Singapore - Healthcare play Parkway Life Reit on Tuesday said it has raised its hedging against interest rate movements, and has no long-term loan refinancing needs until 2017, as it reported a 16.1 per cent rise in its distribution per unit (DPU) for the fourth quarter.
Its DPU for the three months ended Dec 31, 2015, stood at 3.37 Singapore cents, up 16.1 per cent from 2.9 cents for the year-ago period. This was largely boosted by a divestment gain of S$2.3 million, which was part of the total distribution earned from the sale of seven Japan properties in December 2014. Full-year DPU was 13.29 cents, up 15.3 per cent.
It also registered higher rent from existing properties. Excluding the distribution of one-time divestment gains, DPU from recurring operations rose 3 per cent from the year-ago quarter.
Net property income rose 4.8 per cent from the year-ago quarter to S$24.6 million.
Parkway Life Reit said the amount of its debt that is hedged against fluctuations in interest rates has risen from 78 per cent to about 95 per cent. It also has pre-emptively termed out existing maturing loans to ensure no immediate long-term loan refinancing needs until 2017. Gearing stood at 35.3 per cent.
It has hedged its yen-denominated income, yielding a realised foreign exchange gain of S$0.6 million in the quarter. Parkway Life Reit holds 42 nursing homes and care facility properties in Japan, as well as the three Parkway hospitals: Mount Elizabeth Hospital, Gleneagles Hospital and Parkway East Hospital. The Singapore hospitals contribute just over 60 per cent of gross revenue.
It said it expects further uncertainties given the market volatility but is optimistic about the long-term prospects of the regional healthcare industry. Units of Parkway Life Reit gained one Singapore cent to end at S$2.17 on Tuesday.
This article was first published on Jan 27, 2016.
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