The strong momentum in Summerset's business has continued, with third-quarter sales and year-to-date sales well ahead of the previous corresponding period, Forsyth Barr broker Suzanne Kinnaird says.
The retirement village developer and operator raised annual earnings guidance after sales climbed 64% in the third quarter and in anticipation of increased activity in the final three months of the year, when residents moved into its Wigram village.
Resales were particularly strong, with the company recording its strongest level of resales in any one quarter, she said.
The Wellington-based company expected underlying profit of between $36million and $39million in calendar 2015, up from a previous range of between $32 million and $34million and more than the $24.4million reported in 2014.
Summerset, which operates in Dunedin, increased total occupation rights sales to 162 in the three months ended September 30, from 99 a year earlier. Of that, new sales rose 22% to 83 and resales more than doubled to 79.
''These were driven by a continued steady sell-down across developing sites as well as higher levels of resale stock available for use,'' chief executive Julian Cook said in a statement.
''Our new Wigram village in Christchurch saw its first residents move in during September, and settlements at this village will contribute to new sales in the fourth quarter.''
Last month, Summerset was granted consent for a $100 million village in the Christchurch suburb of Casebrook to build a 237-home site with a 49-bed care centre.
The company's year-to-date sales rose 47% to 432, of which new sales were up up 40% to 243 and resales gaining 56% to 189.
Ms Kinnaird was keeping a neutral rating on Summerset with a price target of $4.76 a share.
''Our forecasts are slightly above the previous guidance range of $32 million to $34 million. Key area of upside to our forecast is the level of resales for 2015 of 202 units.''
