Summerset lifts unit build rate, increases bank funding

Summerset Group, the rest-home operator whose shares have jumped 49% this year, says it has lifted its long-term annual build rate for new retirement units and agreed to an increase in its bank facilities to help fund the expansion.

The Wellington-based company is now aiming to build 300 units a year by 2015 compared to a target in the prospectus for its initial public offering last year of 250 units a year by 2016.

Summerset has increased its banking facilities by $30 million to $180 million and says it does not plan to tap shareholders for more funds to expand.

The shares last traded at $1.97, valuing the company at $427 million. They are rated a "hold" based on the consensus of four recommendations compiled by Reuters, with a price target of $1.95.

The company says it is on track to deliver its IPO forecast of 155 retirement units in the 2012 financial year and now plans to build at least 200 in the 2013 financial year. It currently has 1554 units.

"Our strong sales of occupation rights, range of quality new sites, and increased efficiency through the in-house management of the development and construction process has increased the rate at which we can expand," chief executive Norah Barlow says in a statement.

The company also says it has bought a 3.8ha development site in the Auckland suburb of Ellerslie which will become its 19th retirement village.

(BusinessDesk)


Got a question about this story? Leave it in Comments & Questions below.

This article is tagged with the following keywords. Find out more about MyNBR Tags

Comments & Questions

Commenter icon key: Subscriber Verified

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot

Forex

Sym Price Change
USD 0.6950 -0.0002 -0.03%
AUD 0.8886 -0.0015 -0.17%
EUR 0.5909 0.0002 0.03%
GBP 0.5271 -0.0005 -0.09%
HKD 5.4232 -0.0062 -0.11%
JPY 79.1460 0.2230 0.28%

Commods

Commodity Price Change Time
Gold Index 1278.6 -9.430 2017-10-20T00:
Oil Brent 57.8 0.550 2017-10-20T00:
Oil Nymex 51.9 0.580 2017-10-20T00:
Silver Index 17.0 -0.177 2017-10-20T00:

Indices

Symbol Open High Last %
NZX 50 8124.1 8142.3 8124.1 0.07%
NASDAQ 6633.4 6640.0 6605.1 0.36%
DAX 13057.8 13063.6 12990.1 0.01%
DJI 23205.2 23328.8 23163.0 0.71%
FTSE 7523.0 7560.0 7523.0 0.00%
HKSE 28360.0 28519.8 28159.1 1.17%
NI225 21391.0 21489.3 21448.5 0.04%
ASX 5896.1 5924.9 5896.1 0.17%