Ryman Healthcare boosts profit, eyes pent-up demand

Friday, 19 November 2021

Ryman has 43 retirement villages across New Zealand and Australia.

Retirement village owner Ryman Healthcare lifted first-half profit and said it’s expecting pent-up demand to come through the market as restrictions lift in the next few months.

Chief executive Richard Umbers said Ryman villages remained in strong demand, even as the Covid-19 Delta strain resulted in lengthy lockdowns in its biggest markets of Auckland and Melbourne.

The company sold 703 occupation rights to its villages in the first half of its financial year to September 30, ahead of the 577 it sold in the same period last year. Total transacted sales rose 48 per cent to $510 million and only 1.2 per cent of the retirement village portfolio was available for resale at September 30.

“Sales have been remarkably resilient,” Umbers said. “We expect to see pent-up demand come through in the market as restrictions lift in the next few months and we are cautiously optimistic about the months ahead.”

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Ryman’s first-half profit lifted 33 per cent to $281.5m as the value of its properties increased $178.7m.

With 43 retirement villages in New Zealand and Australia, housing 12,800 residents, Ryman is New Zealand’s largest retirement village operator.

Excluding the impact of property gains, Ryman’s underlying profit rose 8.5 per cent to $95.9m.

Ryman began work on three new sites during the half, at Takapuna in Auckland and Highett and Ringwood East in Melbourne, bringing its total villages under construction to 15.

The company will pay its shareholders a first-half dividend of 8.8 cents a share, unchanged from the previous year.

Chairman David Kerr said the board had adjusted the dividend policy from 50 per cent of underlying profit to a 30-to-50 per cent range, which he said would help it deliver its long-term growth plans.

Kerr will be replaced as chairman by Greg Campbell from January next year but will remain as a director on the board. Campbell joined the board in March and was named deputy chairman at the company’s annual meeting in July.

The company’s shares fell 4.8 per cent to $13 in mid-afternoon trading on the NZX.