Ryman expansion lifts first-half earnings; expects record full-year profit

Friday 18th November 2016

Ryman Healthcare lifted first-half earnings and said it expects to report another record profit for the full year, as New Zealand’s largest retirement village operator inked higher sales and continues to expand.

Underlying profit, which excludes fair value changes from its property portfolio, rose 9 percent to $76.5 million in the six months ended Sept. 30 compared with the year earlier period, the Christchurch-based company said in a statement. The company expects full-year underlying profit of between $175 million to $185 million, up from $157.7 million last year.

Net profit, which includes $118.2 million of unrealised revaluations of units on the back of new stock and a strong housing market, jumped 41 percent to $187 million.

Ryman owns and operates 30 villages in New Zealand and Australia and invested a record $272 million in new villages, innovation and upgrades to existing villages during the half. It opened four new villages, has one under construction, four in the consenting phase and six in the planning and design phase. It's continuing to landbank sites for future growth, acquiring a new site in Hobsonville, Auckland, during the first half, and is on track with its goal of having five villages open in Melbourne by 2020, having recently acquired a fifth site in the suburb of Coburg.

"We've made good progress thanks to growing resident demand for our unique Ryman-style villages and a strong real estate market," chairman David Kerr said. "The four new villages we opened this year are rapidly expanding to meet that demand, and are on track to be completed within the next 12-18 months."

Ryman increased its retirement village units by 14 percent to 5,650 from the year earlier, and its residential care bed numbers rose 17 percent to 3,281. Its landbank allows for the future development of 3,850 retirement village units and 1,315 residential care beds.

Funds from the sale of existing units rose 15 percent to $147.1 million in the half, while sales from new units lifted 7.1 percent to $110.5 million.

The company will pay a first-half dividend of 8.5 cents a share on Dec. 9, a 16 percent increase from the year-earlier payment of 7.3 cents.

Shares in Ryman last traded at $8.43, having slid 0.8 percent this year.

BusinessDesk.co.nz

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