VHP Vital Healthcare

[winner69]

Many of you in VHP

I’ve always stayed clear because of the Northwest connection

See BusinessDesk has a bit on recent cap raise bring up dodgy dealings by Northwest on the previous raise and mention of FMA etc etc

Doesn’t give investors confidence

[nztx]

Many of you in VHP

I’ve always stayed clear because of the Northwest connection

See BusinessDesk has a bit on recent cap raise bring up dodgy dealings by Northwest on the previous raise and mention of FMA etc etc

Doesn’t give investors confidence

With you there Winner - have always stayed clear of this one & the recent VHP SPP/Bookbuild as well

[peat]

I’ve always stayed clear because of the Northwest connection

See BusinessDesk has a bit on recent cap raise bring up dodgy dealings by Northwest

Doesn’t give investors confidence

Jenny Ruth picks a bone sometimes eh!? and this company seems to be a repeat offender , so as much as we love the WALT and the medical sector, we wont take part.

[Onion]

Many of you in VHP

I’ve always stayed clear because of the Northwest connection

See BusinessDesk has a bit on recent cap raise bring up dodgy dealings by Northwest on the previous raise and mention of FMA etc etc

Doesn’t give investors confidence

I used to be a holder but sold out when it became apparent that the managers benefit much more from certain decisions that the unit holders. I still like the segment they invest in but have not been tempted back into the fold..

[Snoopy]

Many of you in VHP

I’ve always stayed clear because of the Northwest connection

See BusinessDesk has a bit on recent cap raise bring up dodgy dealings by Northwest on the previous raise and mention of FMA etc etc

Doesn’t give investors confidence

With accounting reporting conventions getting more and more prescriptive, I find it interesting that more and more 'non-standard' accounting disclosures are being adopted to 'better reflect' the true underlying performance of the business.

While perusing the VHP accounts the latest non GAAP measure to come to my attention is AFFO or 'Adjusted Funds From Operations'. The warning sign for me here is that you can apparently 'adjust' for anything you like. The big adjustment that VHP makes is a $12.402m incentive fee expense that is added on to net profit (in the context of a $51m net profit before tax) . That incentive fee is payable to 'Northwest', the Canadian based management company that operates the management contract for VHP. In one sense I can see the logic of disconnecting these incentive payments from normal operational performance. The problem I have is that VHP is using AFFO as a measure from which to derive their dividend. The net effect of this is that last year Vital Healthcare paid out a significant amount more than their profits in dividends. Is this another version of the old borrowing to pay dividends trick?

Since the incentive fee does have to be paid in some form, this looks like VHP are being dishonest to their unit holders, by falsely inflating the yield from their property trust by disregarding a real cost on their business. Thoughts?

SNOOPY

[Snoopy]

Any thoughts on the rights issue?

I am glad it is a rights issue and is renounceable but they should have included a facility to automatically market and sell unclaimed rights and return the proceeds to investors (most are retired) ala NAB. That way no one loses.

The above refers to a former capital raising in 2016. It looks like VHP have 'learned', and organised their latest rights issue as Jaa suggested. I am not sure that those who 'did not take up their rights' will be happy with the proceeds returned though:

From the 16th May market announcement:
"As the volume-weighted average price for the existing units on the last trading day prior to the retail bookbuild was less than the offer price, in accordance with the Offer Document the price for the Retail Bookbuild will be the same as the Offer price, being $2.95 per new unit. This means that no premium in respect of the Retail Bookbuild will be paid to retail unitholders who did not take up their entitlements in full or who were ineligible to participate.".

Now I have nothing against the VHP business per se. I think the long leases locked in are good. And VHP is the only property trust entirely dedicated to the wider medical profession property. My beef is that the share price has been bid up too highly, with the resulting measly yields available to unit holders not reflective of the risk.

"Gross proceeds of approximately $30.7m. (including ~$1.8m of additional new units under the Offer)"
"Eligible retail unitholders took up 34.0% of their entitlements."

Maybe after looking at their options, existing VHP unit holders have reached the same conclusion that I have, as an outsider.

SNOOPY

[winner69]

Solid result

Unlike many in sector shareholders get a pay rise this year ….keeping un with inflation

http://nzx-prod-s7fsd7f98s.s3-websit...763/376299.pdf

[fungus pudding]

Solid result

Unlike many in sector shareholders get a pay rise this year ….keeping un with inflation

http://nzx-prod-s7fsd7f98s.s3-websit...763/376299.pdf

Is VHP a PIE?

[ithaka]

Is VHP a PIE?

It appears to be
https://www.vitalhealthcareproperty....tive-Units.pdf

[fungus pudding]

It appears to be
https://www.vitalhealthcareproperty....tive-Units.pdf

Excellent. Thanks muchly.