Summerset by the Park, Flat Bush where kitchen staff were replaced last month. Photo / supplied
Summerset by the Park, Flat Bush where kitchen staff were replaced last month. Photo / supplied
New Zealand's second-largest listed retirement company pushed up bottom-line profit 135 per cent, showing how the pandemic isn't denting the sector's profitability but driving it to new heights.
Summerset Group made $543.7 million net profit after tax for the year to December 31, up on the previous year's $230.8m, mainly because of massive paper gains on the values of its many properties.
Revenue rose from $172.4m to $205.3m but the bottom line was boosted by a record $537.5m in revaluations, up on the previous year's $221.1m revaluations.
Underlying profit shot from $98.3m to $141.1m and total assets grew from $43.9b to $4.9b.
Yet gearing still fell from 32.6 per cent to 27.8 per cent.
The company build a record 671 units including 278 villas, two main buildings and three apartment blocks in the past year.
It now has 16 villages under construction in nine New Zealand regions.
It got resource consent approval for six villages in the year and all units scheduled to be delivered over the next four years now have resource consent, it said today.
Scott Scoullar, Summerset chief executive. Photo / supplied
Scott Scoullar, chief executive, said the year had been extraordinarily good because of record demand and build rates.
"We have had a very strong year for occupation right sales, up 25 per cent overall on FY20, and our strongest-ever year for pre-sales. In 2021, 72 per cent of all deliveries were pre-sold, and as a result net profit after tax and the underlying profit for Summerset are company records," Scoullar said this morning.
This year, the company will build in Milldale, Blenheim, and continue work on another 15 sites.
Summerset has land for another 5313 units and the largest listed retirement village land bank for units in the sector, he said.
Earthworks began late last year on its first Australian village where units are expected to be ready next year.
But Scoullar said the sector had issues: "Finding nursing staff has been an ongoing issue. Increases to public sector nursing wages and immigration delays induced by Covid-19 have created a perfect storm for nursing shortages in aged care.
"We increased nurses' pay rates to remain competitive with the public sector again in 2021 to attract and retain the vital nursing staff we need," he said.
Shareholders will get 18.5cps dividend, up 42 per cent on the previous year.
Summerset by the Park, Flat Bush where kitchen staff were replaced last month. Photo / supplied
Last month, kitchen staff at Flat Bush's Summerset by the Park in Auckland were replaced when it was discovered a worker attended an Omicron-linked wedding.
"One of our kitchen workers was in attendance at the wedding in Auckland mentioned on the news," Scoullar said of the January 15 event hosted at the Totara Event Centre in New Lynn.
"They were working during the last week in the kitchen. They weren't symptomatic during that period but obviously had obtained the virus," he said.
The company has dealt with two other Covid cases: a hospital worker at Ellerslie and a hospital patient at Flat Bush. In none of the three cases did the virus spread to anyone else in Summerset villages, Scoullar said today.
He earned around $1.2m for the full year, having started as CEO last March and being CFO before then. His payments included $476,000 in long-term performance incentives, $161,000 short-term incentives and a base salary of $631,000.
He had earned the incentives due to the company's good performance.
Summerset has 36 villages completed or under development: at Aotea in Porirua, Avonhead, Bell Block, Blenheim, Cambridge, Casebrook in Christchurch, Dunedin, Ellerslie, Hamilton, Hastings, Havelock North, Hobsonville, Karaka, Katikati, Kenepuru, Levin, Lower Hutt, Manukau, Napier, Nelson, New Plymouth, Palmerston North, Pāpāmoa Beach, Paraparaumu, Prebbleton, Richmond, Rototuna, St Johns, Taupō, Napier's Te Awa, Trentham, Waikanae, Wanganui, Warkworth, Whangārei and Wigram.
It plan work at Half Moon Bay, Milldale, Parnell, Rangiora and Kelvin Grove in Palmerston North.
