Arvida Group Limited (NZX: ARV) Reports Record Profit on Revaluation Gains

Tuesday 25th May 2021

NZX listed retirement village and aged care operator Arvida Group Limited today reported a record full year IFRS net profit for the year ending 31 March 2021 up 207% on the prior year at $131.1 million. Results included the impact of unrealised movements in the fair value of investment property.

Arvida Chief Executive Bill McDonald said performance had been strong this year despite disruptions from New Zealand’s response to the Covid-19 pandemic impacting first half results.

Underlying profit for the year at $51.9 million was in line with the prior year. Second half performance for the Group was significantly improved, 53% higher than the first half.

“Additional expenditure was incurred in the first half to ensure resident safety and staff wellbeing was the priority and we were able to keep Covid out of our communities.”

Mr McDonald said Arvida maintained strong operating cash flows and resilience in care revenues throughout the year.

“While we continued to operate throughout the pandemic as an essential business, care admissions, sales and construction activities were significantly disrupted in lockdown periods,” said McDonald.

Dividend and outlook

Arvida Chair Mr Peter Wilson said Arvida’s shareholders will receive an increased unimputed dividend of 1.50 cents per share for the final quarter. The dividend is to be paid on 10 June 2021 with a record date of 2 June 2021.

Mr Wilson said, “We are pleased to return a total of $29 million to our shareholders in dividends during this year. The dividend is evidence of the strong momentum in the business even in a pandemic-impacted year.”

The Arvida board also announced the intention to move the target distribution band to 40-60% of underlying profit. A dividend reinvestment plan would be implemented at the next dividend payment with payments becoming six monthly. Mr Wilson said the dividend reinvestment plan would help support Arvida’s capital base as it looks to recycle capital into growth opportunities including greenfield development activity.

“Both our care operations and retirement villages continue to perform strongly, and our development activities continue to grow,” said Mr Wilson.

The current level of dividend is expected to be sustainable for FY22. However, Mr Wilson noted that Covid-19 would be a factor globally for some time yet with the outcomes unknown on the business and domestic economy as New Zealand opens its border. The Government’s move to dampen residential house prices and possible review of the sector’s regulatory framework are factors that could impact the sector and performance of Arvida.

Please see the links below for details

Media Release

Investor Presentation

Annual Report

Results Announcement

Distribution Notice

Source: Arvida Group Limited

Comments from our readers

No comments yet