Ryman Healthcare has invested a record $272million into new retirement villages during its first-half trading year, and is expecting to post another record, full-year profit.
Operating cash flow rose from $157.4million a year ago to $161.2million, underlying profit rose 9% to $76.5million and valuation gains lifted reported profit after tax by 41% to $187million.
Ryman chairman Dr David Kerr said strong gains from the resale of occupancy rights drove the result and the busy construction programme set the stage for a bigger second half. Ryman’s interim dividend increased 16%, to 8.5c per share.
Dr Kerr said the company’s strong balance sheet and growing operating cash flows allowed Ryman to invest a record $272million in new villages, innovation and upgrades to existing villages during the trading period.
"We have 11 new villages in the pipeline which will serve a growing need in each of those communities," Dr Kerr said.
For the full year, underlying profit was expected in a range of $175million-$185million.
Dr Kerr said occupancy in Ryman’s established care centres was 97%, well ahead of the industry average of 89%.
"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," he said.
Ryman was continuing to landbank sites for growth, acquiring a new site in Hobsonville, Auckland, during the first half, and was on track with its goal of having five villages open in Melbourne by 2020.
At a glance
• Ryman Healthcare, founded Chch 1984. Owns and operates 30 retirement villages in New Zealand and Australia. Home to more than 10,000 residents, employs more than 4500 staff.
• New villages opened, still under construction: Petone, Lower Hutt, Birkenhead, Auckland, Pukekohe, Rangiora, North Canterbury.
• New village under construction: Greenlane, Auckland .
• New villages in consenting phase: Devonport, Auckland, Brandon Park, Melbourne, Tropicana, Auckland and River Rd, Hamilton.
• New villages in planning and design phase: Burwood East, Mt Eliza and Coburg, all in Melbourne. Hobsonville, Auckland, Newtown, Wellington, another unidentified site, New Zealand
— Source: Ryman Healthcare
