Ryman posts record first half earnings

Edmund Hillary Retirement Village, part of the Ryman portfolio.

Ryman Healthcare, the rest-home operator whose shares have surged 40 per cent this year, posted a record first-half profit after expanding its villages and reaping more in care and management fees.

Net income rose 9.5 per cent to $38.5 million, or 7.7 cents a share, from $35 million, or 7 cents, a year earlier, the company said in a statement today. Realised profit, which excludes deferred tax charges and unrealised movements in the value of property, climbed 12 per cent to a record $29 million.

Ryman is ramping up its construction of retirement units, and is on track to add 300 units and 150 aged care beds this year across five sites. The company owns 21 villages and plans to open two more this year. The shares were unchanged at $1.96 on the NZX today and have advanced from $1.40 at the start of the year.

"Our occupancy across the board is at all-time highs and the recurring earnings from our completed villages are just getting stronger," chairman David Kerr said. Ryman's expansion is all "being funded out of operating cashflows."

Operating cash flow surged 30 per cent to $79 million in the first half and the company said in today's statement that it has achieved a nine-fold increase in profit and dividends since 1999 without tapping shareholders for more funds. It will pay a first-half dividend of 2.7 cents a share, up 12 per cent from a year earlier.

Net income was also lifted by a 5 per cent increase in the fair value of investment properties to $32.5 million.

First-half revenue was lifted by an increase in care fees to about $44 million from $37.7 million a year earlier. Management fees rose to $8.4 million from $7 million.