Metlifecare boosts earnings 37%, at top end of guidance, appoints Kim Ellis as chair
By Suze Metherell
Aug. 25 (BusinessDesk) - Metlifecare, the retirement village operator which counts the New Zealand Superannuation Fund
and Infratil as cornerstone investors, increased underlying full-year earnings by 37 percent, at the top end of its
guidance, and named seasoned company director Kim Ellis as chairman.
Underlying profit, which removes non-cash items including unrealised valuation gains, rose to $46 million, from $32.1
million a year earlier, and was at the top of its $43 million to $46 million guidance in May, the Auckland-based company
said in a statement. The shares rose 3.5 percent to $4.50 and have gained almost 10 percent this year.
Net profit was $68.8 million in the 12 months ended June 30, down from $120 million a year earlier, which included a one
time gain of $63.6 million gain on the acquisition of Vision Senior Living and Private Life Care Holdings and the sale
of its Christchurch development and Nelson village. Sales rose 3.5 percent to $94.6 million, with the settlement of 458
occupation right agreements, its second highest for the past six years.
As part of Metlifecare’s strategy to focus on the premium top and central North Island sites, such as Hamilton, Auckland
and Bay of Plenty, the company sold its Christchurch development land for $9.4 million and its Nelson Oakwoods village
for $29 million in 2013, using the funds to pay down debt. The retirement village operator is sitting on a land-bank of
over 1,000 units and care beds and is further expanding, particularly in Auckland where it is spending $200 million on
two new villages in Auckland's North Shore, on the expectation the 65 year old plus population will double to more than
a million people by 2036.
"Our villages are strategically located in residential markets where quality retirement lifestyle options continue to
enjoy strong demand," said chief executive, Alan Edwards. "We have a significant development pipeline and a growing
portfolio of high quality villages which will assist in enabling us to meet projected increases in demand."
Ellis has joined the board as chair, replacing outgoing Peter Brown, who is retiring after heading the board for the
past three years. Ellis is currently Chair of New Zealand Social Infrastructure Fund and a director of Freightways, Port
of Tauranga, Fonterra Shareholders Fund, Moa Group, Envirowaste Services, Ballance Agri-Nutrients and privately held
Tasman Tanning.
The board will pay a final dividend of 2.5 cents per share, taking the full year dividend to 3.75 cents a share, up from
3 cents a year earlier.
The stock is rated a "buy" on the consensus of five analysts surveyed by Reuters, with a median price target of $5.15.
(BusinessDesk)