New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

Vital Healthcare Property Trust / Equity Bottom-Up

<ul><li>Vital Healthcare (VHP) provided a largely uneventful 1H24 result, with a small adjusted funds from operation (AFFO) decline driven largely by higher interest costs and asset sales.</li><li>Over the last 12 months VHP has been busy selling non-core assets (c.NZ$220m) to help fund its development pipeline and support its balance sheet.</li><li>With c.NZ$210m to spend on committed developments and gearing close to its 40% top end, more work needs to be done. </li></ul>

Vital Healthcare (VHP) provided a largely uneventful 1H24 result, with a small adjusted funds from operation (AFFO) decline driven largely by higher interest costs and asset sales.Over the last 12 months VHP has been busy selling non-core assets (c.NZ$220m) to help fund its development pipeline and support its balance sheet.With c.NZ$210m to spend on committed developments and gearing close to its 40% top end, more work needs to be done. 

Vital Healthcare - 1H24 Result — Recycling for Growth

<ul><li>Vital Healthcare (VHP) announced its 1H24 revaluations which saw the value of its property portfolio decline by -4% or -NZ$145m.</li><li>This was driven by a +16 bps expansion in cap rate to 5.21%, with the share price implying cap rates will expand further.</li><li>The declines were larger in Australia (-5%) than NZ (-3%), which is a reversal of recent trends where NZ valuations reacted faster to higher interest rates. </li></ul>

Vital Healthcare (VHP) announced its 1H24 revaluations which saw the value of its property portfolio decline by -4% or -NZ$145m.This was driven by a +16 bps expansion in cap rate to 5.21%, with the share price implying cap rates will expand further.The declines were larger in Australia (-5%) than NZ (-3%), which is a reversal of recent trends where NZ valuations reacted faster to higher interest rates. 

Vital Healthcare - 1H24 Valuation Check-Up

<ul><li>VHP reported a solid FY23 result underpinned by acquisitions, development completions and CPI linked rent growth.</li><li>Higher than expected tax was the key variation to our forecasts.</li><li>While FY24 DPS guidance was slightly disappointing it is a minimum, and the timing and value of asset sales could provide upside. </li></ul>

VHP reported a solid FY23 result underpinned by acquisitions, development completions and CPI linked rent growth.Higher than expected tax was the key variation to our forecasts.While FY24 DPS guidance was slightly disappointing it is a minimum, and the timing and value of asset sales could provide upside. 

Vital Healthcare - FY23 Result — Busy Developing

<ul><li>VHP has reported FY23 AFFO +8% to NZ$73.3m reflecting higher rental income from acquisitions, developments, and inflation linked rent growth being partially offset by higher interest and tax.</li><li>However, due to an expanded capital base, AFFO per unit was down -6% on the prior period.</li><li>The result was slightly below our expectations largely due to higher tax expense.</li></ul>

VHP has reported FY23 AFFO +8% to NZ$73.3m reflecting higher rental income from acquisitions, developments, and inflation linked rent growth being partially offset by higher interest and tax.However, due to an expanded capital base, AFFO per unit was down -6% on the prior period.The result was slightly below our expectations largely due to higher tax expense.

Vital Healthcare - FY23 Result First Take – FY24 Guidance Slightly Below

<ul><li>Rising cap rates drive revaluations: Draft 2H23 revaluations of VHP's portfolio resulted in a -NZ$160m movement in asset values with +34bps increase in cap rates partly offset by rent growth and FX movements.</li><li>Asset devaluations more than priced in: The listed equity market had already more than priced in this level of cap rate expansion and asset devaluation.</li><li>Higher gearing being offset through asset sales: We estimate VHP's FY23 gearing to be c.38%, which is creeping towards its management's upper limit of 42.5%.</li></ul>

Rising cap rates drive revaluations: Draft 2H23 revaluations of VHP's portfolio resulted in a -NZ$160m movement in asset values with +34bps increase in cap rates partly offset by rent growth and FX movements.Asset devaluations more than priced in: The listed equity market had already more than priced in this level of cap rate expansion and asset devaluation.Higher gearing being offset through asset sales: We estimate VHP's FY23 gearing to be c.38%, which is creeping towards its management's upper limit of 42.5%.

Vital Healthcare: Benign Revaluation Diagnosis

New Zealand

Vital Healthcare Property Trust is a property trust that invests in and manages healthcare facilities in New Zealand and Australia.

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Vital Healthcare Property Trust (VHP NZ)

Vital Healthcare - 1H24 Result — Recycling for Growth

Vital Healthcare (VHP) provided a largely uneventful 1H24 result, with a small adjusted funds from operation (AFFO) decline driven largely by...

Forsyth Barr

Vital Healthcare - 1H24 Valuation Check-Up

Vital Healthcare (VHP) announced its 1H24 revaluations which saw the value of its property portfolio decline by -4% or -NZ$145m.

Forsyth Barr

Vital Healthcare - FY23 Result — Busy Developing

VHP reported a solid FY23 result underpinned by acquisitions, development completions and CPI linked rent growth. Higher than expected tax was the...

Forsyth Barr

Vital Healthcare - FY23 Result First Take – FY24 Guidance Slightly Below

VHP has reported FY23 AFFO +8% to NZ$73.3m reflecting higher rental income from acquisitions, developments, and inflation linked rent growth being...

Forsyth Barr

Vital Healthcare: Benign Revaluation Diagnosis

Vital Healthcare's (VHP) 2H23 draft valuations have resulted in a -5% reduction in the value of its property assets with larger value declines in...

Forsyth Barr

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