BUSINESS OVERVIEW 20 Al-`Aqar Healthcare REIT | Annual Report 2024 STATEMENT OF FINANCIAL POSITION Al-`Aqar’s total asset value declined by 1.1% to RM1.8 billion as of end-FY2024, mainly due to fair value losses on REIT’s Australian asset. Gearing stood at 41% in 2024 following the completion of a private placement exercise in April 2023, which raised RM100 million through the issuance of 83 million new units. The net proceeds were used to redeem the outstanding amount under a revolving credit facility. Al-`Aqar aims to reduce its gearing level, aligning with the average gearing level of Malaysian REITs. The Fund is currently exploring various financial arrangements to effectively manage gearing levels and enhance financial flexibility. STATEMENT OF CASH FLOWS PERFORMANCE BENCHMARK BENCHMARK FY2023 FY2024 COMMENTARY Management expense ratio (%) 0.58 0.54 The ratio improved driven by a higher average total asset base as well as lower expenses. Total return (%) 8.01 15.03 Total return increased due to higher closing price (RM1.36 vs RM1.24). Average annual total unit price return - 5 years (%) 5.23 6.91 The 5-year average annual total return increased due to higher closing price in FY2024. Average annual total unit price return - 3 years (%) 5.03 11.62 The 3-year average annual total return increased due to higher closing price in FY2024. Distribution Yield (%) 6.37 5.35 Distribution yield was decreased due to higher closing price of RM1.36 and lower DPU of 7.27 sen in FY2024. NAV per unit (RM) 1.2772 1.2548 NAV per unit declined by 1.7%, reflecting the total comprehensive income for 2024 (RM45.9 million) and the distribution of RM16.8 million as the final income payout for FY2023, along with RM47.9 million in interim distributions for FY2024. MANAGEMENT DISCUSSION & ANALYSIS OPERATING ACTIVITES Net cash generated from operating activities stood at RM96.0 million in FY2024, compared to RM101.2 million in FY2023. The decrease was in line with a lower NPI. INVESTING ACTIVITIES Investment income increased by 26.7% to RM1.9 million (FY2023: RM1.5 million), primarily driven by higher returns from fixed deposits. The Group also recorded proceeds of RM13.0 million from the disposal of the Damai Wellness Centre. Meanwhile, RM2.2 million was utilised for investment property enhancements. FINANCING ACTIVITIES A total of RM100.6 million was used for financing activities in FY2024. This included income distributions totaling RM66.1 million. Islamic financing costs paid were RM34.5 million, slightly lower than the previous year. A point to note is that there were no repayments made to Islamic Financing in FY2024, compared to RM100 million paid in 2023. As a result, cash and cash equivalents increased to RM87.3 million as at the end of-FY2024, up from RM84.3 million in FY2023.
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