Q2 2022 NorthWest Healthcare Properties REIT Earnings Call

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only mode. Following the presentation we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for an operator. Also note that the call is being recorded on Friday, August 12, 2022. I now would like to turn the conference over to Paul Dalilana. Please go ahead, sir.

Thank you, operator, and good morning, everyone. Appreciate you joining us today. I'm joined by Shailen Chande, the Chief Financial Officer. Together, we are pleased to share our results for the second quarter of 2022. First, I'd like to point out that during today's call, we may look forward, we may make forward-looking statements as defined under Canadian Securities Law. While such forward-looking statements reflect management's expectations regarding our business plan.

and future results, they are necessarily based on assumptions that are subject to uncertainties and risks, which could cause actual results to differ materially. We direct all of you to the risk factors outlined in our public filings.

And now to the quarter. The REIT's high quality and defensive $10 billion plus portfolio delivered strong financial results highlighted by an 8% increase in net asset value per unit growth year over year driven by fair value gains exceeding $450 million.

and for the quarter, AFFO of 20 cents per unit.

Underpinning these results are the REITs foundational pillars, which include a high quality defensive portfolio.

delivering strong built-in growth in this quarter, 3.6% constant currency in SPNOI, and supported by 97% student occupancy and long-term inflation index leases.

REIT continues to execute on attractive growth opportunities with an almost $1 billion completed year to date, including $775 million U.S. acquisition that closed in April in the quarter.

which further improved geographic and tenant diversification as well as tenant credit quality.

While the rising interest rate environment is tempering the REIT short-term outlook for on-balance sheet acquisitions, the REIT means constructive on the long-term demand factors that drive value creation in healthcare real estate.

3. It has a large and growing pipeline, but in the moment is increasingly selective with the opportunities it allocates capital to, and the preference to fund from fee-bearing capital vehicles rather than directly on balance sheet has increased.

In terms of strategic capital formation, the REIT led

a vital capital raise of $170 million in the quarter, providing $50 million contribution at share. The raise supported VITAL's next leg of growth, which is underpinned by more than $240 million of committed development projects and a future pipeline of approximately $1.5 billion.

In addition, on May 10th, the REIT entered into a second Australian core hospital joint venture with GIC, its existing partner, that includes a total commitment of $2.1 billion to continue building on the success of its first Australian JV that is now fully deployed or committed. These initiatives are key growth drivers of the REITs management CA income.

Despite macroeconomic uncertainty, The REIT continues to see demand for healthcare real estate and capital flows into the sector and it continues to progress at pace with its US and UK joint venture initiatives.

It is working closely with a short list of institutional investors to agree final terms and complete documentation and that it will be in a position to announce the UKJV in Q3 with the US tracking towards a Q4 closing in 2022.

Building on its experience in investing in healthcare precincts, the REIT is also working on a new $5 billion global healthcare development fund focused on the development of new generation assets at the intersection of healthcare research and education. The REIT is in early stage discussions with institutional investors and has identified a seed portfolio with which to launch the fund.

With respect to balance sheet optimization, year-to-date the REIT has refinanced or extended more than 93% of its 2022 debt maturities, increasing its weighted average term to maturity to 3.3 years.

At Q2, the REITs proportion at LTV was temporarily above target following its strategic entry into the US.

That said, leverage is expected to decline by approximately 900 basis points to approximately 45% post completion of the US and UK JV initiatives previously mentioned. Importantly as well, with fixed term debt increasing to more than 70% of the REIT's total debt and weighted average interest rates expected to decline by approximately 40 basis points to 3.3%.

The REIT continues to increase commitments and deploy capital in each of its joint venture platforms, with total commitments exceeding $10.8 billion today, including $4.4 billion in undeployed fee-bearing capital.

Post completion of the previously noted joint venture initiatives, deployed capital and total commitments are forecasted to increase to more than $19 billion and $7.4 billion respectively.

With target ownership ranging between 20 and 30% across its global capital platforms, the REIT expects to generate significant uplift in both FFO and NAV on a per unit basis by leveraging this more capitalite model to fund future growth.

For the quarter, our results were in line with expectations, with $0.20 per unit of AFFO implying a payout ratio of approximately 100%. Same property earnings and accretion from investment activity was in line with expectations, although AFFO on a per unit basis was reduced by higher cost and financing in place temporarily to support its U.S. acquisition.

Additionally, transaction volume within capital platforms was relatively low due to our focus on the strategic US entry and completion of the UK joint venture initiative.

Finally, the appreciation of the Canadian dollar by approximately 4.4% relative to the REITs. Average foreign currency exposure year over year similarly muted earnings by approximately one penny in the FFO on a per unit basis.

The impact of these items is viewed by management as a one-time in nature and when reversed in the second half of 2022 per unit, AFFO is expected to recover to trend.

Critically, just isolating on the UKJV as an example, this will add approximately five cents per unit in 2022 to AFFO and three cents on a recurring basis thereafter, as well as reducing leverage by 460 basis points alone.

Reported net asset value during the quarter or during the year increased 8% to $14.19 per unit driven again by fair value gains across the portfolio and the expansion of the global asset management business.

With respect to the liquidity, the REIT is well positioned with over $125 million of available uncommitted.

resources today. This is expected to increase to more than $300 million as the REIT seeds its current UK portfolio and future US portfolio into JVs.

Operationally, our results were in line with expectations with accelerating SP&LI growth of 3.6%, largely driven by contractual rent indexation and again underpinned by high 97% occupancy in a long-awaited average lease term of 14 years.

in all regards, highly defensive.

While the macroeconomic environment is creating uncertainty around inflation and interest rates, the REIT remains well positioned with more than 82% of its revenue indexed to local inflation measures, which include over 90% indexation in its international markets.

segmentally I note the following

In Canada, we were on plan with portfolio occupancy remaining stable at 91% and SPNOI up 2.4% for the quarter. We continue to see a return to pre-COVID activity at our properties, including increased leasing activity quarter over quarter. Additionally, we are making progress on a number of life sciences and ambulatory care initiatives which are gaining momentum and expected to become part of the business in the near future.

In the US, our newest region, our portfolio is performing as expected with occupancy at 97% and an almost 10 year weighted average lease term.

Northwest has successfully onboarded and integrated assets and respective management platforms and continues to progress on new renewal leasing activities, including a 26,000 square foot 30 bed expansion of an existing hospital tenant.

In Brazil, we were on plan steady 100% occupancy and continued strong cash currency SPNOI of 10.7%. Operationally, we note that the REIT's major tenant in Brazil, Regidor continues to deliver exceptionally strong results and is among Brazil's top 10 companies by market capitalization.

Europe continues to perform well with constant currency SPNY growth of 3.7% and occupancy stable at 97.5%. We continue to find good investment opportunities in Europe , allowing us to not only increase scale and critical mass in our existing regions, but also to consider opportunities in adjacent markets.

And finally, in Australia, our largest market, occupancy, remains steady at nearly 100%, and delivering constant currency SP&LI growth of 8.3%, with a weighted average lease term of almost 16 years.

I'm pleased with the progress we've made during the quarter and post quarter, which advanced the REIT's strategic objectives and produced solid operating results. With deep strategic relationships, best-in-class regional operating platforms, and strong access to both public and private capital, the REIT continues to transition to a more asset-light service, a best-in-class global healthcare real estate investment manager.

With that, I'll now ask the operator to open up for questions. Thank you, sir. Ladies and gentlemen, if you would like to ask a question, please slowly press star followed by 1 on your touchtone phone. You will then hear a three-tone prompt acknowledging your request.

And if you would like to remove yourself from the question queue, please press star followed by 2. And if you are using your speakerphone, we do ask that you please lift the handset before pressing any keys. Please go ahead and slowly press star 1 now if you have a question.

And your first question will be from Please go ahead.

Thank you, Abhayra. And thanks for the call up all and your opening comments.

My first question is broadly on the macro picture. Considering the macro scenario you are seeing right now, and probably even looking at the Chinese music market.

Are you seeing any of that play into the thought processes that your institutional investors and audiences are undertaking right now? I mean, that has to happen to the next and change their view on the location to real estate.

Thank you.

Maybe just, I think I understood your question, but if I could just bring some precision to it. So are we seeing global investors thinking differently about where they might...

consider capital allocation and of course where that might drive some of our initiatives. Simple as that.

Yes.

Okay, I mean, listen, the last 90 to 120 days of course in terms of macroeconomic moments have been impactful, you know, and that's coming off of a couple years of COVID and, you know, high, you know, uncertainty and volatility around those sorts of initiatives. I think what we're seeing when we're talking to partners right now, it's there been a short-term focus obviously.

very much towards inflation index or related investments. Of course, the overwhelming trend in the last 90 days has been increased inflation across the globe. I think we fall into that bucket, of course, in that we are highly linked to inflation. Of course, our business does have some caps and collars. So it's not as pure and open as some segments, but still highly related and tracking to inflation growth. We're seeing that in our own portfolio, of course, today.

as we see SPNOI roughly getting up to that 4% range across the business. So that is a big theme that we're seeing. Certainly with this amount of volatility in the markets, although at later in the quarter and in the moment today, I think we've seen a little more stability come through with perhaps some better visibility on what long-term rates might be. We've certainly seen a little bit of pause in.

in activities across all sectors. I think that's a theme that is probably pretty relevant. Although that hasn't impacted our thinking and our discussions around capital formation in that I think broadly speaking, there's still a significant underweight in global capital pools into the quote unquote alternatives space and the big reweighting that was going on continues. So we're still pretty constructive on capital formation and I think it's really.

a much longer term trend than the moment. So those would be some themes that we've seen at the capital level. At the operating level, I might just call it one theme, which is really become pronounced, which is building on the post-pandemic kind of moment. And that's really an incredible demand for health services, probably only muted by capacity. And that capacity is probably being very much driven by human resources more than anything else.

So we've never seen a moment where there's so much demand for health services and as a result, you know, a lot of discussion with operators about how, you know, how we can help provide capacity and new capacities. So, you know, very big things. So fundamentally, healthcare is very strong, again, muted really by human resources and the ability to provide services, you know, which there's lots of strategies on to grow and evolve. So those would be a couple big trends.

that we're seeing coming through the corridor in generally, which remains supportive to our business and really only a small amount of tempering around the edges in each case.

Just following up on your comment on the shortage of visas, especially owing that into the trading market, has that moved your conversation with authorities here in terms of the opportunities you're seeing in this market?

Yeah, yeah, it's no, I don't think it has. And again, you know, recall that we have quite a mature existing medical office building portfolio. So growth for us through that portfolio has always been a little more incremental and tuck in and that we've had, you know, again, almost 18 years, if I count our pre public time to build the MOB business across the country. Where we've been very focused is into

newer segments, so in the ambulatory and outpatient space. And really, as we talk about Canada and the pressure points in the health system in Canada, we've never seen it as high. It's at the breaking point level and so ambulatory and outpatient is a real trend. Clearly, it's a mature trend in other markets like the portfolio we've acquired in the US as an example, which is a much more evolved market.

But we are just seeing a lot of thinking around new formats and really getting as much healthcare as we can out of major acute hospitals so that they can do the major acute work and that the more simple and less acuity and a better cost environment. And that's a big trend. How to do that and where to do that, again, in a public system becomes a bit stylized, but we're in very active discussions in all of our regions with...

with healthcare providers around how we can help them do that. We see that as a very fundamental trend in Canada growing. The other new segment that we've been looking at quite closely, and I think we will have announcements here in the third quarter, is into the life sciences space. It's a new segment for us, so we've been spending a lot of time thinking about it. Now we have a number of initiatives that are close to fruition that will have both really attractive investment opportunities for us long term.

partnering with educational and research and healthcare partners. You've heard our healthcare precinct strategy is very evolved in other markets, and so we're hoping to bring that back to Canada here, and certainly in the second half of the year. So those are two Canadian thoughts, and that market, like any markets, is very active and quite a secular story around life sciences, of course.

Thanks for that, Karab. That was really great. My final question is on GNA. Obviously, in this quarter, we saw a bit of math text on GNA. From a modeling perspective, would you say that's something which we should be keeping in mind going forward, or is this not representative of studies here?

Hey, good morning, Sai. You have Shailen here. Thanks for that question on G&A and I would call out that Q2 traditionally for us aligns with VITALS year-end and I think what you're referring to is our consolidated G&A numbers. So as part of VITALS year-end, you see things like their AGM, their annual reports and Q2 G&A tends to be inflated by the tune of about a $1.5 million to $2 million or so.

as a lot of those expenses are year-end loaded, I mean that's vital. So I would call out that on a run rate basis, we see that Q2 number come down about $2 million and that's representative of what you'd see in Q1 and Q3 and Q4.

That's brilliant. Thanks, Alan. I'll join back.

Thank you. Next question will be from Frank Liu at BMO Capital Markets. Please go ahead.

Good morning Paul, how are you today?

Bye.

Good morning. So I just want to touch on the USGV side. So that's still expected to be closing Q3 or it could be like a Q4 event.

Yeah, I think we've messaged at Q4 for the US and Q3 for the UK.

Thank you. So, and then I think in your MDNA, so basically like the US portfolio is currently classified as a, as a helper sale, and then you're gradually going to sell like properties to your daily partner in the US.

No, we think as with other initiatives that we've done in the past that the US initiative will be portfolio based as opposed to asset based and that we'll do it on block with a partner I guess so that would be some precision to that comment.

Got it. Also just switching gears to the new 5 billion dollars global house care fund. I'm just curious like which geography would that fund focus on and you know I mean the assets are looking to sitting like your existing assets or looking to buy new assets and sitting to the to the G V.

Yeah, sorry, some precision here required. That initiative is our development core fund. It will be principally Australia-based, although possibly include New Zealand. And yes, we will see that with a number of our existing balance sheet initiatives, which are long-term healthcare precinct developments, which we've been assembling as a portfolio. We have three today that are in that category.

As I said, we're in advanced discussions with a small number of very significant partners to pursue that. So compared to our Australian core JV as an example, it will be also equally long term, have more development of course, it's principally development oriented. And –

And we expect to have some precision on that by the end of the year here later in the fourth quarter with a number of projects starting to enter into.

to commencement of construction and master planning. So good progress happening on that initiative.

Okay, perfect. That's all my questions. I'll turn it back. Thank you.

Thank you. Once again as a reminder ladies and gentlemen if you do have any questions please slowly press star followed by one on your touch tone phone. And your next question will be from Scott Fromson at CIBC.

Thanks and good morning gentlemen. So just turning back to UK, the hospital market there is clearly very highly prospective but the JV timeline has taken longer than expected. Does this reflect things like the ongoing pandemic waves, economic slowdown and or deal complexity or does it reflect changes in the potential partner group, things like partners dropping out?

for changing the terms due to pressures in other parts of their portfolios.

Yeah, thanks Scott. That's a super fair and good question. So let me go back in history a little bit. I think it's been a little bit of all of that over the last three quarters as we've announced this initiative and then been looking.

to bring it to conclusion. You know, maybe as a reminder, we started with a portfolio that had a heavy amount of asset management initiatives required to it, and so while we knew where we were going to do the JV, we deferred sort of completion and execution of it through the completion of those asset management strategies, which have worked out very nicely for us and have really resulted in some significant value creation for the business, and that's really the...

the 2021 story. Through the balance of this year, I think what I'd say is that our JV process moved forward successfully and as expected and that we made a decision late in this quarter to extend that process to allow a potential strategic partner to become involved with a slight potential to, let's just say, evolve the JV that we originally had in mind. It was done very consciously.

And we're actively working at that, which we think will improve sort of the breadth of the JV initiative going forward. It's not complete, but we made a conscious decision, again, noting that we had a successful process through the JV. And that, as I mentioned, in terms of its quarterly and go-forward impacts really is important to the business on those three metrics of 2022 earnings and NAV as well as, of course, the JV.

a little work to be done here over the next 30 to 60 days on that strategic angle to the JV. It was a difficult decision for the business to gain noting the importance of the underlying JV to our results and our strategy, but we felt in the long term and in the possibility of doing something that would make it even more compelling and market leading in a number of ways that it was the right decision. So a little bit of flavor there. Of course, through our regular JV process, which we had an active.

advisor involved in a number of parties. We probably had 125 different investors through that process and all sorts of variations to your earlier question of what was it like. But in general, I think the themes that you've heard me talk about, about high interest in long-term index cash flow, the stability of the UK, particularly with its overarching NHS underwrite and the high quality portfolio that we had with three of the four top operators and vice versa.

long-term contractual best-in-class leases and arrangements was very compelling.

I think we've found it very productive to go out and meet with a number of investor groups and we narrowed that field down to a very short list of what we could consider the highest and best kind of long-term partners that we might find. And I think we were able to get to that point successfully. And so we've initiated this small extension to allow it to just evolve a little bit and it's carried over through the quarter end.

It could, but I'd be reluctant to sort of commit to that at this point, but that's the type of thing that makes it strategic enough to warrant the extension that I mentioned.

And has the extension brought in other potential partners?

potential partners.

I think it could, but I think we still see clarity with the parties that have ended up at the success end of our original process. So we're not imagining that it's going to be overly complicated and larger in that sense. We're still keeping it to a relatively small group.

Okay, thanks. And then just a quick question on acquisition valuations or asset valuations. Have you seen any?

change any expansion of cap rates across the portfolio in terms of what vendors are looking for. They're holding firm on the basis of long-term prospectivity.

Yeah, that's a great question. So, you know, listen, I think in the moment, and certainly.

what we have seen is a bit of a liquidity premium or from a vendor perspective perhaps a liquidity discount. It hasn't come through our discussions, but again we do see that out there in terms of broad transaction land and I know the thought of interest rates being higher than they were and that's for sure a noticeable trend does drive the potential for some wide cap rates. I think the market.

talk that we hear and see could be in that 25 basis point range. That said, from our portfolio, one of the offsets against that, and we've been doing a lot of thinking about that, of course, is through built-in indexation. And so we sort of see our portfolio quite insulated from that type of change because we're seeing much higher indexation and rental growth coming through the portfolio. So there's a natural offset. So a few answers there, but.

For sure in the moment, people are asking themselves what are long-term rates and as a result what am I doing about it and that's probably as we know at least in private markets ended up in a bit of a bid ask spread which is prototypical. We do see some of those trends muting post quarter certainly with a little more rate stability and the long end of the world coming in to I think sort of more normalized.

levels, things have already started to come back and tighten down. So those are some things that we're seeing and obviously in our perspective, other than trying to be very opportunistic, and we haven't seen any particularly opportunistic situations arise given the core nature of what we do, we see maybe a slowing of volume. We've done the same thing just to make sure we're comfortable about that long set of arrangements and to end up in a balanced place.

UK healthcare fund and noting it serves to kind of improve your overall breadth.

and kind of the outlook of the JV.

at the same time it sounds like the ultimate kind of LPs in the fund will be consistent with what you envisioned at the onset. So if that is the case I'm just curious that you can add a bit more color in terms of how kind of the LP base that was improved or how the outlook for the JV improves with your proposed solution.

Yeah, that's a good question, Mario, and it might be a longer answer that we may need to take a little bit offline just given some of the comments that I've said. But what I can say is that as with existing arrangements that we have in our existing JVs, we've been looking for long-term partners that have the capability to do, again, bigger than smaller things.

And as a reminder, the UK portfolio, if you will, is core and in the market that we want to be in for the long term. So those sort of thematics underpin sort of our approach to what we might do. We've more typically been, as we said, a small number of institutional partners as opposed to perhaps a fund, to say it a different way.

And that continues through the UK process that we ran, although we saw lots of alternatives in that direction and we sort of elected to continue in the structural format that we've been using so far. And again, with a strategic partner, or the strategic element that I've just mentioned, I think it has the potential to increase both the size and perhaps, you know, the, you know, let's say the development or growth of the JV, the internal growth of the JV. And that's kind of it.

the thing that we've liked the most about it. So, it's complimentary to our existing business and to our existing arrangements. But this is not done and I just say that the existing JV, irrespective of if we're able to move this over the line is well placed to complete and we felt that it was worthwhile at the risk of having to have this expanded conversation with all of you in the right way of course, to take that for the long term opportunity set.

It's still, if I had to balance it, a 50-50 proposition today. And I think the expectation for the business is that in all events we'll complete the underlying JV in Q3 and move on with what we said we were going to do. And there's a possibility that we can grow it and make it even more qualitatively better.

That's the decision that we took and it was a tough decision. I mean, we know that it's an important step in the business for us and we've been talking about it for a while. So we didn't take that lightly. So that was the moment that we came to and excited about bringing conclusion to all of it. Of course, it's your right to say, sort of what are we doing and lots of good questions. But I think we're on the cusp of having that answer and I expect that we'll have some goodness.

very shortly. I can appreciate the complexity and the short term is the long term tug-of-war for sure. The 50-50 proposition that you just made the comment Paul, is that in reference to the JV deal getting done or is that in reference to something else?

Yeah, to the expanded JV if we can say it like that. Yeah, I know that 100% reference to the JV getting done. So just to be clear that hasn't changed.

Okay, switching gears to the Global Precinct Fund and more specifically just to...

the development yield that you disclosed came down a little bit quarter to quarter, 10 to 20 basis points. I'm not sure if that was just FX driven or whether it does reflect the escalating cost structure that we're seeing across asset classes globally. How do required returns...

within this fund compared to your predecessor funds in Australia. So, like for asset development versus a stabilized asset, how should we think about required returns in that fund and whether there will be any notable changes in the fee structures within this fund relative to what you have today?

Yeah, that's an excellent question. So I'll let Shailen pick up on the narrow one of rates. Before that, I'll answer broadly. So yeah, this would be in the core plus, you know, type return range versus core, which is our existing JV. So, you know, wider for sure. It is initially substantially development oriented.

you know, markedly higher fees in the near term, obviously, same fee structure in the long term as approximately the same fee structure, which is a combination of base asset management fees and property management and leasing and related fees. So, you know, probably what's noticeably different is in development. So, you know, that fund, I think, will be substantially development oriented initially and then...

migrate into a feed structure that looks like the Core JB product that we...

that we have today. So I hope that answers the question. In terms of the bigger theme of where are returns today and what are people looking for, I think with long-term core investors, there's been some movement there. And it may be what we're seeing could be in that 50 to 100 basis points, but certainly that's also driving people to look very much at the development process to generate opportunities, given how hard it is to find.

that's in Australia, we're trading into the high three cap range, you know, as recently as this quarter we see that, so action evidence there. So there's very strong demand to be able to find that product, you know, new built and with all the features that we like at a premium yield to that sort of baseline. So that's the rationale behind the fund and of course the thing that we brought to that is the precinct angle which is that the investments and the development.

125 LPs that you kind of looked at over time.

What's that process been like with this fund? And if you have to take a guess today, what ends up being the size of the LP base?

in this one.

Yeah, it's a fair question. We're targeting a very small number of big investors that again are capable of making 20 plus year commitments and providing significant capital over that time. So it's quite a selective group where they're well known to us and we think it'll be a very small club as opposed to a broad based fund. Thank you.

Okay, my last question just comes to FX. You had some pretty decent value game recorded this quarter, but it was

I'm completely wiped out by a pretty significant FX.

loss as these funds launch over time in the different jurisdictions.

How do you think about altering the FX strategy over time?

If at all, as you bring in new partners with different costs of capital and things like that, it doesn't change at all as you proliferate your asset management business.

Yeah, I think from the earnings side, I think more as the business reaches this next level of maybe structural...

simplicity from our standpoint or just achieves its destination, then I think we look favorably to sort of bringing in tools on the earnings side that might reduce any interim volatilities and I think that would be prototypical to others in the industry that might be doing things in one to two years sort of to smooth out anything. On the balance sheet, as you know, it's really hard to hedge the balance sheet other than using.

in region financing. And so the good news is that perhaps we'll be more diversified and spread across an even larger number of markets. And we'll let that continue to work. I mean, we've certainly been out actively researching alternatives, but it's not easy to hedge the balance sheet, as we know. And so we don't have at the moment a plan to make a dramatic change there, other than that we'll be.

reducing our look through ownership into that, from where it is today down to approximately 30% as we've been guiding to, and that's the journey that we're on. And I guess that will give us the ability to have more diversification and related things, broader market exposure we've added the US, which we think will provide some more stability. But yeah, that's kind of the direction to travel, I think in the moment, Shailen, you might add to that. Yeah, hi Mario, Paul I think that covers a lot of the, I mean, a lot of the conception.

weighting to on balance sheet assets relative to capital platforms given our proportionate interest. So we see that as being a stabilizing factor as we execute on both the UK and the US and bring a more balanced FX profile to the business.

Okay, that makes sense. And then from a disclosure standpoint, I'll show you when there's the intention to group the US, Canada, Brazil, as the Americas going forward or are you to the world.

Okay, that makes sense. And then from a disclosure standpoint, I'll show you when there's the intention to group the US, Canada, Brazil, and the Americas going forward, or are you to provide separate geographic disclosure?

Yeah, most definitely into the Americas. I think we'd had that Canada-Brazil breakout prior to entering into the US and I think the US really solidifies our Americas or Pan-American strategy. So as we look at it going forward, it's into those three segments of Americas, Europe and Australasia.

Okay, thanks guys.

Thank you. And at this time, Mr. Dalilana, we have no further questions. Please proceed.

Thank you. Yeah, no, I appreciate everyone's involvement today. Maybe as a final point and just coming back to some of the UK JV comments that we've said, you know, we made a conscious decision this quarter to extend our JV formation for a number of key reasons. Again, we do note that had we proceeded as we were in a position to do, you know, that our earnings this quarter and for the balance of the year would have been plus five cents per unit higher.

and on a three cents on a run rate basis for 2023. And obviously LTV would have been 460 basis points lower than it is today. So, that is still a highly visible transaction that is coming through the business shortly. And we made that decision consciously to permit further exploration of an even more qualitatively superior JV opportunity. But in all events we expect to bring.

conclusion to that process in Q3. So just to bring a highlight to one particular item in the moment. But thank you everyone for your time and appreciate your involvement. Have a great day.

Thank you sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending, and at this time we do ask that you please disconnect your lines.