Medipower: The FFO in the quarter rose by 25% – the capital market

The income-producing real estate company

Medipower
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Operating in the U.S., Canadian and Bulgarian markets, its financial results for the fourth quarter of 2020 and for the entire year are released: NOI for the quarter totaled $ 3.9 million, up 28% from $ 3 million in the same quarter last year. The quarterly FFO totaled $ 1.5 million, up 25% from $ 1.2 million in the same quarter last year. The NOI in 2020 was about $ 16.7 million, an increase of about 31% compared to about $ 12.7 million in 2019, and the annual FFO amounted to about $ 7.1 million, an increase of about $ 7.1 million. -22% from a level of about $ 5.8 million Ashketad. The company also says that the NOI from identical assets decreased in 2020 by a lesser level of 0.8% to a total of $ 12.7 million.

Medipower is considering raising up to NIS 65 million through the expansion of Series B bonds and raising a minimum amount of NIS 35 million through a shelf prospectus ($ 30 million in total). It was also decided not to distribute a dividend for the year 2020 and to cancel at this stage the company’s dividend distribution policy. Medipower explains that the decision was made “in light of the company’s growth strategy, including the company’s engagement in a letter of intent to acquire a portfolio of 5 commercial centers in the state of Pennsylvania in the United States for about $ 115 million.”

Total profit for the quarter attributed to shareholders was $ 180,000, 80% lower than $ 922,000 in the corresponding quarter. Excluding exchange rate differences, this is a loss of $ 174,000, compared to a profit of $ 789,000 in the corresponding period. For the full year, total profit attributable to shareholders amounted to $ 3 million, a third lower than $ 4.5 million in 2019. Excluding exchange rate differences, this is a profit of $ 2.8 million, compared to $ 4.2 million. The capital attributed to the capital holders at the end of 2020 was about $ 75.3 million, an increase of about 4% compared to about $ 72.6 million at the end of 2019.

Medipower specializes in the acquisition, management and improvement of community shopping centers. Regarding the transaction in Pennsylvania, the company says that it is expected to expand its leased commercial space by about 60%, and lead to an increase in the total value of the assets that will amount to $ 360 million after the transaction. Medipower specifies that the current NOI of the properties they will purchase is about $ 8 million a year, the average lease is about 6 years, and that of the rental supermarkets is about 9.4 years. It was also stated that the total occupancy rate of properties (including supermarkets) is about 89% and the average rent per square meter is about $ 12 per month.

Regarding the corona crisis, the company estimated that its exposure to it is limited in both the short and medium term. Among other things, Medipower writes that “the nature of the properties is that of shopping centers anchored in defined tenants, and all remained open and active throughout the crisis. The firmness of the anchor tenants was also noted and it is expected that most of the rent that has not yet been paid by the date of approval of the reports will be paid in full in the future.

“Medipower’s business model, which is characterized by low sensitivity to economic slowdown, has shown that even during a global epidemic and traffic restrictions, there is a demand for basic products and services such as supermarkets, pharmacies and more,” he said. Medipower CEO Ron Stern. “We intend to expand the property portfolio on the East Coast of the United States while maintaining a stable balance sheet and a high level of liquidity.”