In FY2023, the Group recorded a higher gross revenue of RM121.0 million (FY2022: RM110.2 million) and net property income of RM114.5 million (FY2022: RM104.2 million). Profit increased to RM60.7 million (FY2022: RM60.1 million), with realised profit of RM63.2 million. The Fund achieved a total DPU of 7.90 sen in FY2023. This achievement aligns with the Manager’s expectations and translates to a remarkable payout of 100%, marking a 10-year high for Al-`Aqar, demonstrating the Manager’s continuous commitment in delivering higher DPU to unitholders. 2023 AL-`AQAR FINANCIAL PERFORMANCE. DISTRIBUTION PER UNIT (SEN) 7.90 8.10 7.80 6.81 7.75 7.70 7.70 7.70 7.70 7.65 7.85 2013 2017 2015 2019 2022 2014 2018 2021 2016 2020 2023 LETTER TO STAKEHOLDERS The Manager successfully maintained their business prospects by adeptly turning risks into opportunities through an effective and ongoing Capital, Investment and Asset Management plan. CAPITAL MANAGEMENT On 20 April 2023, Al-`Aqar successfully concluded the private placement of 83.1 million units, generating total gross proceeds of RM99.7 million. This move contributed in lowering the gearing level to 40.8%, creating room for future acquisition strategies. Moreover, due to the elevated OPR rate as expected, the Group saw an increase in Islamic financing cost by 41.7%, reaching RM39.1 million in FY2023 (FY2022: RM27.6 million). Nevertheless, the weighted average finance cost of 4.86% in FY2023 was below that of FY2018, which averaged 5.44%. ASSET MANAGEMENT On 25 August 2023, the Manager renewed the master lease for five properties, which contributed 11.8% of Al-`Aqar’s revenue in FY2023. Additionally, the Manager has also managed to maintain a 100% occupancy rate for its entire portfolio of assets, ensuring that all the properties were leased out throughout the year. INVESTMENT MANAGEMENT On 15 November 2023, Al-`Aqar entered into a Sale and Purchase Agreement (“SPA”) with Sihat Damai Sdn Bhd for the disposal of Damai Wellness Centre for a disposal consideration of RM13 million cash. Subsequently, on 12 December 2023, Al-`Aqar entered into an SPA with Principal Healthcare Finance Trust for the disposal of Jeta Gardens Aged Care Facilities, with a disposal consideration of AUD24.4 million (or proximately RM74.9 million). Both transactions are targeted to be completed in 2024. These strategic moves are part of the Group’s capital recycling strategy, whereby the Manager divests underperforming and/or underutilised assets and utilises the freed-up capital to acquire highyielding assets, distribute to unitholders and/or reduce borrowings. 2023 AL-`AQAR INITIATIVES 2023 - A PRODUCTIVE YEAR (CONT’D) 12 BUSINESS OVERVIEW 1 3 4 5 6 AL-`AQAR HEALTHCARE REIT ANNUAL REPORT 2023
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