High full-year earnings expected as expansion continues
Ryman Healthcare Ltd increased its net surplus for the September half by 69% to $7.6 million on gross revenue up 60% to $43.6 million and said full-year earnings should comfortably exceed last year’s.
Ebitda (earnings before interest, tax, depreciation & amortisation) rose 51% to $9.2 million, the operating cashflow was steady at $18.7 million, earnings/share rose 69% to 7.6c/share and the dividend was increased 50% to 3c/share, with no imputation credit.
Ryman’s total assets rose 12.6% to $180.2 million, including the new Hilda Ross retirement village in Hamilton & the just-opened Grace Joel retirement village in St Heliers, Auckland.
Equity rose from $100.3 million to $116.4 million (giving a conservative 35.4% debt:assets ratio) after the company retained 60% of earnings for expansion in the previous half. Its debt ratio is likely to stay at that level as expansion is funded by operating cashflows.
Ryman has established 5 retirement villages since it listed in June 1999 and said it would continue growing its asset base by developing new villages in the upper North Island. It holds land for expansion at 6 existing sites over the whole country, plus the large Abbotts Way site in Ellerslie, yet to be developed.
Earnings from ongoing operations improved, with higher occupancy than last year. The substantial portfolio growth increased resales revenue & deferred management fees markedly.
Opening of the Hilda Ross village contributed significantly to the earnings increase, both in terms of new sales of occupation rights and the establishment of a profitable care operation. Further facilities are being developed there.
Occupation right sales more than doubled, from 93 to 190. New sales rose from 45 to 109, and earnings from those sales increased from $7.9 million to $17.6 million.
Resales rose from 48 to 81, and resale earnings from $5.5 million to $9.5 million.
The company said strong interest had been expressed in the Grace Joel village and more units would be available in the 2nd half.