Ryman Announces 17% Profit Increase
19 May 2011
Christchurch based aged care and retirement village operator Ryman Healthcare today announced a 17% increase in underlying profit, posting a new record of $72 million for the year. Unrealised valuation gains lifted the reported profit after tax to $100 million.
The underlying profit growth has prompted the directors to lift the annual dividend by 18% to 7.2 cents per share, with the remaining 50% of the company’s profits being retained for investment in new villages both in New Zealand and Australia. The final dividend of 3.8 cents per share will have a record date for entitlements of June 10, and will be paid on June 24.
Operating cashflows were again strong at $133 million for the year, and the increasing value of the village assets helped boost shareholders equity by 24% to $566 million.
“This is a very strong performance from the company, ahead of our own expectations, and in the face of a weak economy” said chairman Dr David Kerr, “It’s a result that reinforces the defensive nature of the company’s trading activities and reflects the company’s growing reputation for looking after its residents.”
The company recently announced a lift in its build rate to 550 units or beds per annum in New Zealand.
“We have escalated our expansion plans to meet the growing demand we are experiencing,” said Dr Kerr. “We achieved our new build rate this year, which boosted our new sales by 50%, and allowed us to beat our medium term target of 15% underlying profit growth.”
“This year’s expansion will also spark profit growth in the year ahead, as it also establishes new income streams from care fees, management fees and resales gains.”
A new village was successfully opened in Dunedin during the year, and work commenced on new villages in both Gisborne and Tauranga. The company is currently building across nine sites, has increased its landbank to over 2100 units or beds, and is well placed to continue building at the new rate of 550 units or beds per annum for the foreseeable future.
The company recently acquired a site in Waikanae and is actively seeking a site for its first village in Australia.
Statistics NZ estimates the number of New Zealanders aged 75 plus will more than double from 250,000 to 516,000 over the next twenty years. Ryman is well positioned to cater for the accommodation and care needs of this rapidly growing group.
Ryman currently owns 22 villages nationwide, which each offer a combination of retirement living and resthome care.
The company is a six times winner of Best Retirement Village in New Zealand, serves over 5400 elderly New Zealanders, and employs over 2600 staff.