Ryman Healthcare's vacancy rate of just 1% of its existing 3482 available units reflected its ability to post record half-year profits of $48 million and record more than $100 million cashflow.
Ryman has been a stellar performer for the stock exchange and investors during the past year, with its share price gaining more than 50% to beyond $4, while having delivered 10 consecutive record annual profits.
Forsyth Barr broker Peter Young said Ryman's vacancies remained under 1%, or 33 units out of 3482, which was "a major key performance and highlights they are doing a good job delivering a product its residents want".
He highlighted Ryman had confirmed it was on track for earlier full-year financial guidance of increasing its underlying profit growth by 15%.
Craigs Investment partners broker, Peter McIntyre, said the half-year provided a "strong result" and other positive news was that the unrealised resale land bank has increased from $170 million in March to $200 million at September, reflecting strength in the property market.
"Ryman continued to invest heavily in aged care, with 226 care beds completed in the half being about 90% of its target run rate, of 250 beds, for the full year," he said.
For the half-year to September, Ryman posted a 16% increase in underlying profit of $48 million, with unrealised fair value movements of $27.3 million pushing reported after-tax profit up 15% to $68.8 million.
Total income from ordinary activities rose 17% to $147 million while operating cashflows rose from $91.6 million to a record $109.4 million for the half.
Ryman, which increased its dividend 18% to 4.6c, saw its shares go up 7c to $4.15 following the announcement yesterday.
Mr McIntyre said the heavy investment in care facilities during 2012 would "dampen" operating earnings in the second half of 2013, because new care facilities lost money initially, but should aid with margin expansion during full-year 2014 as the rate of care bed development eased back towards target levels of 250 annually.
Mr Young said the result was close to expectations with all areas up strongly, including care revenues and management fees up 17% and the fair value portfolio, up 15%.
"Ryman's development margins are a strong 24% and the resales margins a solid 17%," he said.
Total sales of occupation rights were 447 units, of 235 resold and 212 new, against Forsyth Barr's forecast of 418 units, of 214 resold/204 new, but averaging pricing "looks to be slightly below our forecasts".
Ryman Healthcare
• More than 6500 residents in 25 villages nationwide.
• Existing facilities: 3482 village units and 2400 care beds; total 5882.
• To be developed: 1802 village units and 493 care beds; total 2295.
• Targeted build rate: 700 units/care beds a year.
• Villages planned: Waikanae, Howick, Melbourne (Aust) and Petone.
