29 February 2012
SUMMERSET’S INAUGURAL RESULTS STRONG
- Underlying profit for full year 2011 up 35% on IPO forecast to $8.1 million
- Net profit before tax for full year 2011 up 2.3% on IPO forecast
- Net operating cash flow up 14% on IPO forecast
- Sales of occupation rights up 25% on 2010
- 122 units delivered across 5 villages
Retirement village developer and operator Summerset Group Holdings Ltd today announced its full year 2011 results with an underlying profit up 35% on forecast figures.
The annual result is the first to be released since the company listed on the New Zealand Stock Exchange in November last year.
Underlying profit was $8.1 million, compared to the initial public offering (IPO) forecast of $6.0 million.
Sales of occupation rights in the 2011 year were the highest for Summerset since it was established in 1997. Sales were up on IPO forecast by 6.0% and up 25% on the 2010 year.
Managing Director and CEO Norah Barlow attributed this to a very strong performance in the second half of the year driven by an early delivery of new developments and higher sales than predicted.
“Our new developments performed very well and existing villages experienced uplift in demand driven by a number of factors, including an increased brand profile and effective marketing initiatives.”
Summerset’s net operating cash flow was also up on IPO forecast by 14% at $44 million. This was driven by higher occupation rights sales and better than expected operational performance.
“The growth in Summerset’s village footprint has been reflected in its financial performance. During the 2011 year we started two new villages, one in Nelson and one in Hamilton,” Mrs Barlow said.
“In addition we continued development at existing villages in Warkworth, Hastings and Manukau. The Manukau village, Summerset’s largest village in terms of investment, is now complete”.
During the year 122 units were delivered versus an IPO forecast of 121.
Summerset is on track to deliver 155 units in 2012. The company currently has a land bank of 1,052 units across the country and expects to meets its target of delivering 250 units per annum within five years.
The value of Summerset’s total assets is now $617 million, having grown 15% from $537 million in 2010.
Mrs Barlow said she expected there would be further announcements regarding new sites in the coming year.
Net profit before tax was also up on IPO forecast by 2.3%.
Summerset’s after tax result of $4.3 million compared to the IPO forecast of $5.0 million after non-cash accounting tax adjustments were made.
In addition to the strong financial performance last year, Summerset was named the Best Retirement Village Operator in Australasia for 2011 at the Australasian over 50s Housing awards. This was the second consecutive year the company has received the award.
Summerset Chairman Rob Campbell said Summerset had positioned itself as a leading provider to the country’s aging population by expanding and placing an emphasis on providing all levels of aged-care.
“New Zealand is experiencing a significant increase in demand for both retirement village units and aged care beds. Summerset has the capability to cater to that demand. Retirement villages are going to be part of the solution of how we care for our growing numbers of older people and how we make sure that care is of the best quality,” he said.
Mr Campbell said he was pleased with how Summerset has performed since listing in November and congratulated the management team and staff on what has been a great year for the company.