Goulds Rd, Rolleston - Ryman's vast new site on Christchurch's outskirts. Photo / Ryman Healthcare
Goulds Rd, Rolleston - Ryman's vast new site on Christchurch's outskirts. Photo / Ryman Healthcare
Ryman Healthcare's profit shot up 64 per cent after big revaluation gains and the business announced $205 million plans for Rolleston and a new $350m Melbourne village.
The biggest listed retirement village owner and operator on the NZX made $692.9m audited reported net profit after tax in the full year to March 31, 2022, up on last year's $423.1m.
But the bottom line figure included unrealised investment property revaluations which more than doubled from $201.2m last year to $467.1m in the latest year.
New Zealand operations made $589.6m of that net reported profit after tax and Australia $103.2m and one institutional investor said this morning the result was far stronger than the market had expected.
"Speculators have borrowed Ryman stock and sold it on the expectation that it is being removed from the MSCI global index on May 31 and the share price would go down. This very strong result today may make it more challenging for short sellers to buy the stock back," one expert said today.
Underlying profit rose 13.6 per cent from $224.4m to $255m.
The company said it had made a record full-year audited underlying profit, helped by a resilient performance through the pandemic and a strong recovery in Victoria.
Shareholders are to get a final dividend of 13.6 cents per share, taking the total dividend for the year to 22.4cps which is 43.9 per cent of underlying profit. The dividend will be paid on June 17.
One of Ryman's big Melbourne villages. Photo / supplied
At Rolleston, Ryman has bought a 9.5ha site on Goulds Rd where homes for 280 residents are planned. In Melbourne's Coburg North, a $350m village is planned on a 2.56 ha site.
The company's total assets grew to nearly $11 billion during the year, driven by its rapid development programmes, investment in more expensive sites and those massive fair value gains.
It has around $750m of debt headroom and last month issued a further $290m through a United States private placement. The company has now diversified $1.13b of debt away from bank debt, it said today.
The company owns and operates 45 villages which house 13,200 people. It employs just over 6700 staff.
Ryman is planning a further 29 new villages for 9000 people here and in Australia.
Work is not started on every site but is under way on 16 new villages which are being built in both countries at the moment.
Here, Ryman is building at Takapuna on the ex-fire lakefront station site, Lynfield (Murray Halberg), Devonport (William Sanders), Hamilton (Linda Jones), Auckland's Lincoln Rd (Miriam Corban), Havelock North, Hawke's Bay (James Wattie), Hobsonville (Keith Park), Riccarton Park, Christchurch (Kevin Hickman) and Northwood in Christchurch.
Ryman's full-year result is out today. Photo / Lewis Gardner
In Australia, it is building at Brandon Park, Melbourne (Nellie Melba), Burwood East, Melbourne (John Flynn), Highton, Victoria (Charles Brownlow), Ocean Grove, Victoria (Deborah Cheetham), Aberfeldie, Melbourne (Raelene Boyle), Highett, Melbourne and Ringwood East, Melbourne.
Development sites are in Kohimarama, Park Terrace in Christchurch, Wellington's Karori and Newtown, Auckland's Karaka, Cambridge in the Waikato and at Rolleston.
In Australia, Ryman plans to build in Victoria's Mt Eliza and Mt Martha and Melbourne's Essendon, Coburg North, Kealba, and Mulgrave.
Chief executive Richard Umbers said it was a strong result which proved that Ryman had the capability to deliver in challenging times.
"We've got a resilient business model and a fantastic team. We have been able to keep our residents and team safe and have set new benchmarks for clinical care. We are also very committed to improving the financial performance as we execute our plans, and continue to acquire land, build new villages, refurbish existing ones, and sell both new and refurbished units," he said.
Greenfield opportunity for Ryman at Coburg, North Melbourne. Photo / Ryman Healthcare
The business was moving from managing Covid to living with it.
The second half was impacted by Omicron's arrival, but Ryman's operations in Victoria led the recovery with record fourth-quarter sales.
"There's no doubt that the Omicron wave had an impact, but we've been pleased to see strong sales in Victoria in February and March. We anticipate a similar recovery in New Zealand later in the year," he said today.
Ryman shares are trading down 36 per cent annually at just $9.10. They were as high as $15.49 last September but have slid steadily since then. With 500m shares on issue and at that price, the company has a market capitalisation of just $4.5b. That is far less than the value of its assets making it extremely cheap buying on the NZX right now.
