Medical Properties Updates Strategy To Boost Shareholder Value, Pledges To Cut Costs

Medical Properties Trust Inc MPW chalked out an updated capital allocation strategy highlighting its focus on boosting its balance sheet, lowering its cost of capital, and enhancing long-term shareholder value.

The company declared a quarterly dividend per share of 15 cents, to be paid on Oct. 12 to shareholders of record as of Sept. 14.

Also, MPW targets an initial payout of projected near-term adjusted funds from operations (AFFO) of less than 60%.

Related: Analyst Foresees Challenges For Medical Properties Trust, Expects 35% Dividend Cut

The company also aims to curtail discretionary operating expenses and other costs to align with the planned reduction of asset base reduction and near-term acquisition activities.

The company expects to continue refinancing, sales, and joint-venture opportunities that facilitate debt repayments and maintain a diversified portfolio.

Over the past eighteen months, MPW closed several deals to lower AFFO, including an agreement with Macquarie Asset Management for eight Massachusetts hospitals, Prime Healthcare's repurchase of 14 facilities, and seven Australian hospitals.

Related: Biggest US Hospital Land Owner Medical Properties Trust's Prospect Medical Deal On Hold - What It Means For Investors?

Apart from this, MPW inked several deals, expected to close in H2 2023, including Connecticut hospitals divestiture for about $355 million and the rest of its Australian portfolio for around $300 million. 

These deals, if profitable, will decrease the company's leased assets by about $2.5 billion.

Last month, the company reported revenues of $337.4 million, missing the consensus of $351.4 million, and Normalized Funds from Operations (NFFO) per share stood at $0.48, an increase from $0.46 a year ago.

Price Action: MPW shares are trading higher by 2.16% at $7.08 premarket on the last check Monday. 

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