Ryman half-year profit up; new villages set to open

Ryman Healthcare is predicting a 15% boost to annual profit, after posting a 23% increase in its half-year result to $132.5million, albeit boosted by property revaluation.

Brokers are keeping a close watch on debt levels, which are creeping up as construction expands.

More than 160 units were completed in the first half, with expectations Ryman will complete 950 units for the year and that total resident numbers will rise 70% by 2020, to 15,500 people, chairman Dr David Kerr said.

''We've got more building activity going on than ever before, which gives us great confidence about the second half,'' Dr Kerr said in a statement.

Almost half of the $132.5million profit was underpinned by gains in property valuation of $65.2million.

While Ryman has four villages about to open, there are another four large-scale projects awaiting consent. ''The next four villages in the pipeline are all in high-value locations in Melbourne and Auckland,'' Dr Kerr said.

When completed, two of the villages, Brandon Park in Melbourne and Tropicana in Auckland, will have 600 residents each.

There are two other Auckland villages, at Greenlane and Devonport.

''Our new villages are selling off the plans faster than ever before because we are building in areas where there is a real need,'' Dr Kerr said in a statement yesterday.

Craigs Investment Partners broker Peter McIntyre said Ryman's share price was down 6.5% on a year ago, and for six months rolling was down 8%, from $8.10 to $7.05.

He said there were investor concerns that any softening in the general housing market would then be mirrored in Ryman new sales or resales.

Debt had ''stepped up another notch'', from 27% to 29%, or from $407million at the end of March to $494million.

He noted investing cash outflow went up to $199million, a record high outflow, partly due to the $50million land settlement for Brandon Park, its second Melbourne village, and partly due to significant working capital requirements, ahead of opening four new villages in the second half of 2016.

simon.hartley@odt.co.nz

 


Ryman Healthcare

Six months to September . . .

Total operating revenue up 16% from $109.1million to $126.7million.

Profit before tax up 28%, from $106million to $135.4million.

After tax profit up 23%, from $107.9million to $132.5million.

Operating cashflows record $157million for the half year.

 

Villages under construction:

Petone opening late 2015.

Birkenhead, Auckland opening 2016.

Pukekohe opening late 2015.

Rangiora, Canterbury opening 2016.

• Founded Christchurch, 1984, owns and operates 30 retirement villages in NZ and Australia, home to 9000 residents, employs more than 4000 staff.

SOURCE: RYMAN HEALTHCARE.


 

Add a Comment