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Ryman Healthcare lifts annual profit 43% as it benefits from new villages, property gains

Ryman Healthcare [NZX: RYM], New Zealand's largest listed retirement village operator, lifted profit 43 percent as it gained more revenue from a larger base of villages and the value of property increased.

Net income rose to $194.8 million, or 39 cents a share, in the 12 months ended March 13, from $136.7 million, or 27.3 cents, a year earlier, Christchurch-based Ryman said in a statement. Revenue from ordinary activities rose 12 percent to $203.2 million while the value of properties increased by $85.1 million.

Ryman acquired six new sites in New Zealand during the year, extending its land bank earmarked for development to 4,208 beds and units from 2,438 a year earlier. Retirement villages are benefiting from an increase in average life spans which is stoking demand from the elderly, with the number of New Zealanders aged over 65 forecast to increase by 20,000 per annum.

Ryman increased its annual building target to 850 beds and units a year in New Zealand by 2017, from a rate of 700 a year.

Ryman has now expanded to Australia, with the first residents moving into its Melbourne village this month and the company has now bought another site in the eastern suburbs of Melbourne, it said today.

"We're still learning about Australia but our experience so far has exceeded our expectations and given us the confidence to expand," Chairman David Kerr said.

In the past year, the number of sales of occupation right agreements slipped to 977 from 985 although fee revenue rose to $368.2 million from $345.6 million.

The company's total retirement village units and residential beds rose 8.6 percent to 6,724 as retirement village units increased 11 percent to 4,207 and residential care beds rose 4.9 percent to 2,517.

Ryman will pay a final dividend of 6.2 cents a share on June 20.


Comments and questions

Their Devonport 'partnership' with that Auckland tribe may yet prove a real dent in their earnings not withstanding reputation. The locals I am told know a dodgy political deal if ever there was one.

The local NIMBYs, you mean?

Another excellent performance, but in an incresingly crowded market. Their ability to find land in inner cities is getting harder and they are facing more competition for this land, so I suspect that within a few short years their land bank will fall or fall in quality and become more fringe. They need a design change as the current design still looks like the design of villages 15 years ago.

Dismal news in that this will continue to drive the "profit from propert, scrimp on services" mindset in the sector. Oceania Group certainly operate this model with the justification that if residents needs can't be met, they should move out (pretty much the statement from their CEO). Regulations and oversight in the services part of their operations need significant strengthening. Government (and their toothless agencies) is failing the elderly in NZ.