Al-`Aqar Healthcare REIT Annual Report 2019

DPU Distribution yield Total payout 7.75sen 5.87% RM57.0 million (95% of total Al-`Aqar Distributable Income) Taking into consideration the current circumstances, we are pleased to announce that Al-`Aqar has achieved a distribution increment to 7.75 sen per unit for FY2019, compared to 7.70 sen in FY2018. This translates to a commendable distribution yield of 5.87% per unit and total payout of RM57.0 million which represent 95% of the Fund distributable income for FY2019. With regards to the healthcare industry trend, it is expected the industry to remain resilient on the back of rising demand from healthcare tourism and the effects of new government policies encouraging health protection. While growth prospects for the sector globally are positive in the long term, underpinned by an ageing population, rising affluence and increasing life expectancy, the local private healthcare sector has added catalysts. These include competitive charges and hospitalisation costs in medical tourism, a generally English-speaking population, and various incentives from the government. The positive outlook of the industry is expected to benefit KPJ, as the main sponsor of the Fund to experience consistent growth in the outcoming years. The completion of the acquisition of KPJ Batu Pahat Specialist hospital in December 2019 is seen as the beginning of expansion phase of the Fund. The number of KPJ’s new assets that are set to be injected into the Fund for the next 5 years will augur well for the growth of Al- `Aqar. We are committed in expanding the fund via diversification in classes of asset through additions of other non-hospital assets such as primary care centres and aged care centres. The acquisition plan is in line with the investment objective of the Fund to acquire and invest in properties with a view to increase income stability and allow the Fund to enhance the size of its current property portfolio. I would like to take this opportunity to express my heartfelt gratitude to Dato’ Kamaruzzaman Bin Abu Kassim as former Chairman and Tuan Haji Lukman bin Abu Bakar as former board member of Al-`Aqar for their invaluable guidance and contribution to the Board. Our achievement will not be attainable without the support of our stakeholders. I would like to extend our heartfelt gratitude to the stakeholder – unitholder, trustee, financiers, business partners, relevant authorities, management team and staff for their hard work and diligence in 2019. Al-`Aqar Healthcare REIT 01 CORPORATE OVERVIEW 9