Retirement village developer & operator Summerset Group Holdings Ltd forecast yesterday that its underlying profit for the 6 months ended 30 June would be down 6-15% compared to the June 2019 half-year, reflecting Covid-19’s impacts.
That puts the latest profit between $40-45 million.
Chief executive Julian Cook said the company was pleased with the result given the circumstances.
Summerset hasn’t provided a forecast for NZ IFRS net profit after tax due because a key component of this profit measure (fair value movement of investment property) won’t be available until after the completion of an independent valuation process.
It also hasn’t provided any earnings guidance for the full year, given the evolving outlook for the rest of the year.
Summerset delivered 139 new retirement units in the first half. The lockdown saw construction at 13 sites across the country close for 6 weeks.
Mr Cook said, “Summerset is on track to reach its revised year-end build target of 300-350 new retirement units, down from 400 before the Covid-19 pandemic.”
The company has close to $350 million of unused funding capacity available.
Mr Cook said the directors anticipated being in a position to pay an interim dividend, given trading conditions.
Summerset sold 123 units in the June quarter – 58 new, 65 resales.
The quarter included 4 weeks of Covid-19 level 4 lockdown, when prospective residents were unable to visit the company’s villages, and property settlements were suspended. Visitor restrictions were also in place throughout levels 3 & 2, to ensure the safety of residents.
Sales & settlements of occupation rights largely ceased through the level 4 lockdown period, but Mr Cook said they’d largely recovered and sales inquiry & rates were marginally stronger than was typical for this time of year.
Attribution: Company release.