2022 – PORTFOLIO GREW The Malaysia segment was largely resilient, underpinned by the long contractual leases. On 23 December 2022, Al-`Aqar completed the acquisitions of KPJ Pasir Gudang Specialist Hospital (“KPJ Pasir Gudang’’), the extended building of KPJ Seremban Specialist Hospital (“KPJ Seremban’’) and the extended building of Taiping Medical Centre for a total consideration of RM192.0 million, satisfied by combination of RM167.0 million cash and 20.5 million units worth RM25.0 million. This brought Al-`Aqar’s total number of properties to 24 (from 23 in 2021) and investment properties value to RM1.7 billion (from RM1.5 billion as at 31 December 2021). The acquisition of these properties aligns with the Group’s expansion strategy, while fortifying our relationship with the KPJ Group. For the business segment in Australia, the ongoing reform which is led by the Royal Commission has continued to create uncertainties within the aged care industry. The aged care providers are required to implement new standards and reporting systems which resulted in higher operating expenses and adversely affected the financial performance of the aged care providers. Nevertheless, as Australia learned to live with Covid-19 without restrictions, our property in Australia, Jeta Gardens, has also seen the occupancy rate improved from the low of 70% in 2021 to 80% in 2022. Jeta Gardens contributed 5.1% to Al-`Aqar’s total revenue in FY2022 and did not have any significant impact to the DPU. 2022 AL-`AQAR INITIATIVES The Manager managed to sustain their business prospects by transforming the risks into opportunities through an effective and continuous capital, investment and asset management plan. Lower interest rates in 2021 and 2022 benefited Al-`Aqar, where the refinancing exercise in FY2021 contributed significantly to cost savings of RM14.0 million over two years. On 23 December 2022, Al-`Aqar completed the acquisitions of KPJ Pasir Gudang, the extended building of KPJ Seremban and the extended building of Taiping Medical Centre for a total consideration of RM192.0 million. The acquisition will provide minimum additional income stream of RM11.0 million per annum. In 2022, Al-`Aqar has renewed the 3-year rental of KPJ Tawakkal KL Specialist Hospital which contributed 8.6% of Al-`Aqar’s revenue in FY2022, an upward revision of 2.0% from the last rental. Al-`Aqar has also managed to maintain a 100% occupancy rate for all the assets leased out to the lessees during the year. LETTER TO STAKEHOLDERS 2022 2021 24 23 Al-`Aqar’s total number of properties Investment properties value RM1.7 billion RM1.5 billion Capital Management Investment Management Asset Management 7 1. Corporate Overview 3. Strategic Performance 5. Governance Structure 2. The Driving Forces 4. Sustainability Statement 6. Financial Reports
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