Summerset's annual net profit up more than 50%
Summerset’s [NZX:SUM] net profit after tax is up more than 50% on the year before, with the value of its investment property rising again.
The Wellington-based retirement village operator’s net profit after tax in the year to December 31 was $223.4 million, up 54% on 2016.
Summerset’s underlying profit, which excludes unrealised valuation gains on the fair value of investment property, was up 44% to $81.7 million.
The company says annual growth in underlying profit has averaged 47% in the six years since listing in November 2011.
Its total asset value increased 30% to $2.2 billion. The development margin on new retirement units increased to 27.3%, up from 22.2% in 2016.
Summerset chief executive Julian Cook says the company’s profit growth has been driven by strong demand for homes, with good demand across the country throughout the year, including in Auckland.
“This is despite the slowing Auckland property market, which reflects the demographic we serve.”
At the end of 2017, there were more than 4700 residents living in its 23 villages and more than 1200 staff.
Over the year, there were 682 sales of occupation rights, up 4% on 2016 and 450 new retirement units delivered, up 10%.
It has a land bank of 2841 retirement units and 396 care beds.
The board announced a final dividend of 7.1c a share, bringing the total for the year to a total 11c a share. This is an increase of 3.3c a share on the previous year’s dividend.
Summerset shares last traded at $5.81, up 14.8% over the past 12 months.
More to come.