ING Medical posts loss on property writedown

Wednesday 19th August 2009

ING Medical Properties Trust reported a 2.3% fall in full-year underlying earnings as the investor in health clinics weathered the impact of the worst recession in 30 years and rents rose.

Operating income was $11.8 million in the 12 months ended June 30, down from $12.1 million the based company said in a statement. Rental income rose 9.7% to $23.8 million. The trust posted a net loss of $2.2 million as its property portfolio shed 3.9% of value.

“The manager secured a number of new leases over the previous 12 months, including 10 tenants new to the portfolio which adds greatly to the diversification of the trust’s cash flow,” said general manager David Carr. The net loss reflects “unrealised adjustments” that don’t impact on distributable profit available, he said.

The shares were unchanged at $1.20 and have gained 9.2% so far this year.

The trust’s property portfolio, which includes hospitals and health centres in Auckland, Northland, Hawke’s Bay and Melbourne, was revalued down to $286.2 million from $297.8 million last year.

The decline was relatively benign compared to other listed property entities, which had seen falls of around 10% in their portfolios, Carr said.

Chairman Bill Thurston said the company will “maintain a cautious overall treasury and financial position in the medium-term” and will focus on retaining a conservative balance sheet in the current downturn.

The debt-to-total-asset ratio, or gearing, rose to 35.7% from 34.9% last year and the trust expects the sale of two properties will cut this to 33.6%.

Total assets shrank 4.8% to $295.3 million after the final installment of the Waitemata land settlement of $4.3 million was paid and movement in the mark-to-market interest swaps turned to a $5.3 million liability from a $3.7 million asset last year.

Businesswire.co.nz

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