DELIVERING VALUE ANNUAL RESULTS 2019 | 8 August 2019 Contents - PowerPoint PPT Presentation

DELIVERING VALUE ANNUAL RESULTS 2019 | 8 August 2019

Contents Page  Overview of Vital 3  FY19 Highlights 10  FY19 Financial Results 12  Healthscope Recap 16  Revaluations 19  Portfolio Overview PRESENTED BY: 23  Acquisitions and Projects 28 Miles Wentworth Stuart Harrison  Balance Sheet and Capital Management Interim Manager Chief Financial Officer 36 Richard Roos Chris Adams  Outlook 41 Exec Director, Portfolio Exec Director, Projects  Appendices 43 2 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Overview of Vital

Vital Healthcare overview VITAL IS A PURE PLAY, LISTED LANDLORD TO THE HEALTHCARE SECTOR Vital Healthcare Property Trust (Vital) is an externally managed specialist healthcare property investor that $1.93 B 42 owns a high quality portfolio of hospitals, medical office buildings and aged care facilities throughout Australia and New Zealand (i.e. a landlord to the health sector) PROPERTIES TOTAL ASSETS Vital is the only dedicated healthcare property entity which is listed in Australia or New Zealand (NZX: VHP) 99.4 % 18.1 Vital has a defensive income proposition through quality tenants, high occupancy, a long weighted average OCCUPANCY YEAR WALE lease term, and an attractive organic growth profile through development activity and structured leases Vital is externally managed by NorthWest Healthcare 35.3 % 3.6 % Properties Management Limited, which is wholly owned by a Canadian listed global healthcare real estate DISTRIBUTION YIELD 1 DEBT / ASSETS 2 specialist (1) FY19 after-tax distribution per unit of 8.75 cents divided by the closing unit price as at 30 June 2019 of $2.46 Calculated in accordance with the Vital’s Trust Deed and excludes A$80.3m related party loan which was repaid on 2 August 2019 (2) 4 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Portfolio summary $1.84B PORTFOLIO OF HEALTHCARE REAL ESTATE COMPRISING 42 INVESTMENT PROPERTIES, 139 TENANTS AND ~2,600 BEDS TYPE OF PROPERTIES WITHIN PORTFOLIO GEOGRAPHIC DIVERSIFICATION OF PORTFOLIO Vital has a scale portfolio of high-quality healthcare property across Australia and New Zealand 5 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Outperformance VITAL HAS OUTPERFORMED OVER THE MEDIUM AND LONGER TERM ON A COMPOUND TOTAL RETURN BASIS Compound annual Index 1yr 5yr 10yr return Inception* Vital 27.5% 17.8% 14.3% 13.6% S&P/NZX All Real Estate 31.1% 15.0% 14.1% 9.9% Index Under / over performance -3.7% 2.8% 0.2% 3.7% Source: Bloomberg, Forsyth Barr Total returns (change in unit price plus post-tax distributions) as at 30 June 2019 * S&P/NZX All Real Estate Index data commences 31 December 2004 6 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Our structure – a unit trust VITAL IS A UNIT TRUST THAT IS EXTERNALLY MANAGED BY A LEADING GLOBAL HEALTHCARE REAL ESTATE INVESTOR AND MANAGER Board comprises Vital is a unit trust, managed by NorthWest 2 Independent Directors and Healthcare Properties Management Board of Directors (1) 2 NorthWest appointees Limited, and supervised by Trustees Executors Limited in accordance with the Trust Deed NorthWest Healthcare 100% The Board of Directors is responsible for Properties Management the governance of Vital Limited (Manager) Trustees Executors Management of Vital in Vital’s ability to grow shareholder returns is Limited accordance with the enhanced by NorthWest (a global Trust Deed (Supervisor) healthcare property specialist) as its highly 24.83% Supervises Vital and ensures aligned manager owning 24.83% of Vital compliance with its requirements under the Trust Deed Specialist team of circa 40 professionals 75.17% across New Zealand and Australia Vital unitholders Healthcare properties (1) The Independent Directors of Vital have a casting vote in the event of an equality of votes 7 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Overview of NorthWest – Vital’s manager NORTHWEST: A FOCUSED HEALTHCARE REAL ESTATE INVESTMENT PARTNER Global scale, local relationships Partner of choice for leading operators in each market it invests Deep healthcare real estate expertise 180+ healthcare property professionals based in 3 of the largest global healthcare markets Execution excellence 15+ years of healthcare real estate investment, management and development Entrepreneurial culture, institutional capabilities 10+ year public company track record A proven track record NZ$7.4 B + Track record of delivering strong risk-adjusted returns for investors Assets under management Scalable platform with embedded growth Its operator relationships and existing portfolio provide a robust acquisition and development pipeline 8 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Why invest in Vital? VITAL IS THE ONLY DEDICATED LISTED OWNER OF HEALTHCARE REAL ESTATE IN AUSTRALIA AND NEW ZEALAND EMBEDDED VALUE SPECIALIST AND DEFENSIVE HIGH DEMAND HIGH QUALITY IN LEASES AND EXPERIENCED SECTOR GROWTH PORTFOLIO PROJECTS MANAGER  Healthcare is largely  Ageing  $1.84B scale  >NZ$279m  NorthWest is a a personal priority demographics and portfolio brownfield specialist global rather than a growing population developments over healthcare property discretionary spend  High 99.4% the next 4 years investor and asset  Rising life manager occupancy  High barriers to entry  Weighted average expectancy  NZ$7.4B+ with largely purpose  Long WALE of 18.1 project yield of 6.1% built facilities  Improvements in geographically years  87% annual income diverse asset base science, technology and healthcare subject to structured rent reviews Delivering attractive risk adjusted returns to Vital unitholders 9 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

FY19 Highlights

Highlights VITAL HAS CONTINUED TO DELIVER VALUE AND REMAIN ON STRATEGY THROUGHOUT FY19 Financial Portfolio Acquisitions and Projects Like-for-like same currency rental growth Property revaluations up $104m (up 6.0%) NZ$25m of acquisitions being strategic of 2.3% sites for future development Portfolio WACR firmed 15 bps to 5.61% Normalised NDI of $51.0m, +3.8% Started NZ$218m of return on cost projects Renewed 32 leases with positive spreads with an average return of 6.1% AFFO of $51.0m, +3.0% 18.1 year WALE NZ$61m committed project pipeline via NTA of $2.31, +2.0% Wakefield Hospital stages 2 and 3 99.4% occupancy Debt to gross asset ratio 1 of 35.3%, down Additional opportunities may include 87.3% of leases with structured rent from 37.5% at 30 June 2018 Elizabeth Vale and Ormiston health reviews in FY2020 precincts FY19 total distributions of 8.75 cpu, +2.2% 1.7% p.a. avg. lease expiry over next 10 Total return of 27.5% in FY19 years Calculated in accordance with the Vital’s Trust Deed and excludes A$80.3m related party loan which was repaid on 2 August 2019 (1) 11 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

FY19 Financial Results

Financial performance STRONG PROPERTY LEVEL PERFORMANCE SUPPORTS SOLID NORMALISED DISTRIBUTABLE INCOME Strong contribution from rent reviews, project rentalisation, and acquisitions drove strong property level results See slide 18 “Healthscope Recap” for further detail Increase level of drawn debt and increased margins due to renewed facilities Net distributable income normalised for non-recurring activities in the year 13 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Like for like property income performance STRONG REVENUE GROWTH DRIVING POSITIVE CORE PORTFOLIO PEFORMANCE Comparative like-for-like performance In the like for like portfolio : Gross property income increased 2.2% on a same currency basis, largely (99%) due to structured reviews Property expenses increased 4.8% on same currency basis, largely relating to one-off non- recoverable costs Net property income increased 2.3% on a same currency basis (1) Includes rental income and recovery of property expenses from tenants 14 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Normalised net distributable income OUR NORMALISED OPERATING RESULTS Roll-off of income in advance related to fitout at Ascot Hospital Non-recurring costs and interest related to the Healthscope opportunity Non-recurring costs related to corporate governance activities and due diligence costs related to an acquisition opportunities that did not proceed Higher taxable income due to change in New Zealand taxation on foreign distributions (1) Movement in the value of interest rate swaps 15 VITAL HEALTHCARE PROPERTY TRUST | ANNUAL RESULTS 2019

Healthscope Recap