Target Healthcare REIT (THRL) H1 2026 earnings summary

Executive summary

• Achieved highest half-year returns since 2013, with a 6.8% total accounting return and robust asset management, including 10 disposals at a premium and three modern care home acquisitions.

• Portfolio consists of 86 high-quality, modern care homes valued at ~£895m, 5,885 beds, 32 tenants, 100% en suite wet-rooms, and strong ESG compliance.

• Outperformed the MSCI UK Annual Healthcare Property Index by 93% cumulatively over 11 years and achieved a 7.8% annualised total accounting return since 2013.

• Maintained 100% occupancy and 99% rent collection, with mature home rent cover at 1.9x and five re-tenantings completed with no incentives.

• Increased quarterly dividend by 2.5% to 1.508p per share, fully covered by earnings.

Financial highlights

• Adjusted EPRA EPS rose 8.5% year-over-year to 3.40p; dividend per share up 2.5% to 3.02p.

• EPRA NTA per share increased 4% to 119.4p, supported by property value uplifts and disposals at a premium.

• IFRS profit for the period was £47.0m, up 57% from £30.0m in the prior year.

• Adjusted EPRA cost ratio at 15.4% (12.7% unadjusted), with costs normalized after prior period one-offs.

• Dividend cover at 113% (107% excluding non-recurring arrears recovery); EPRA Net Initial Yield at 6.17%.

Outlook and guidance

• Committed capital of c.£100m available for deployment into a pipeline of modern, purpose-built assets at blended net initial yields above 6%.

• LTV expected to rise from 15% toward 25% as new assets are acquired and capital is redeployed.

• Confident in maintaining near full rent collection and benefiting from inflation-linked annual rental increases.

• Progressive dividend policy maintained, with sector outlook positive due to demographic trends and strong demand.