Oceania Healthcare Limited Analysis

Overview

Oceania operates in the New Zealand residential aged care and retirement village sectors, offering residents villas and apartments within its retirement villages, and also providing a full range of residential aged care services (including rest home, hospital and dementia level care) at its aged care facilities. Oceania is currently New Zealand's third largest provider of residential aged care, and New Zealand's sixth largest retirement village business. Oceania is the freehold owner of 47 of its 50 nationwide sites, comprising 48 aged care and retirement village facilities and two sites held for redevelopment purposes.

Oceania is also an experienced brownfields developer of aged care and retirement village facilities throughout New Zealand.

Oceania Healthcare Limited first listed on the New Zealand and Australian Stock Exchanges on 5 May 2017 under the code "OCA".

Performance

The following information was extracted from Oceania Healthcare's Half year results, released 21 November 2025

Oceania Healthcare (NZX:OCA) has delivered a much improved result for the six months ended 30 September 2025, reflecting disciplined execution and sustained momentum across its strategic priorities of sales performance, business excellence, and capital management. Improved sales conversion, cost efficiencies, and a sharper focus on working capital have strengthened operating cash flow. Gearing has reduced to within target range and the business is well positioned for further sustainable improvement in the second half.

Financial and Operating Highlights

• Total Comprehensive Income: $40.4 million, up $28.6m on 1HY25

• Reported NPAT: $4.9m, compared to a loss ($17.1 million) in 1HY25

• Proforma Underlying EBITDA2: $41.8 million, up 19.7% on 1HY25

• Proforma Underlying NPAT2: $24.1 million, up 18.9% on 1HY25

• Free Cash Flow from Operations: $(8.4) million, 30.0% improvement from 1HY25

• Annualised cost savings: $20.4 million identified, with $4.0 million delivered in 1HY26 and on track to deliver $13.2m in FY26

• Care EBITDA per bed: up 45.5% to $12.4k, reflecting a renewed and disciplined approach to operational excellence and strong sales of care suites

• Total assets: increased to $3.0 billion, up 3.3% on FY25

• Net tangible assets: $1.57 per share, a 3.8% increase on FY25

• Gearing: 34.8%, down 1.5 percentage points from March 2025 and within the target range of 30 – 35%

Financial Performance

Total Comprehensive Income was $40.4m, up $28.6m, reflecting the initial positive impacts of the cost out programme and the impact of fair value gains. Operating Cash Flow increased to $79.0 million, up 12.2% compared to $70.4m in 1HY25. This was driven by higher cash receipts from occupation right agreements (ORAs), up 3.2% on the prior corresponding period, supported by lower payments to suppliers and employees, down 3.8% on the prior corresponding period. The care segment recorded a 40% increase in underlying EBITDA compared with the prior period, supported by enhanced clinical systems, digital workflow tools, and refined acuity management. Annualised care EBITDA per bed, excluding resale gains, rose to $12.4k, up 45.5%, with more than half of the portfolio generating over $15.0k per bed per annum.

Proforma Underlying EBITDA was $41.8m for the 6 months ended 30 September 2025. This included total capital gains of $38.4m, an increase of $0.2m on the previous year