The company also said it would not pay a final dividend. Photo: RNZ / Nate McKinnon
The retirement village provider Ryman Healthcare has posted a 63 percent drop in net profit against a backdrop of economic challenges, severe weather events and the tail end of Covid-related disruptions.
The company also said it would not pay a final dividend, as it repositioned the business for growth and an improved financial performance.
Key numbers for the year ended March compared with a year ago:
- Net profit $257.8m vs $692.9m down 63%
- Property portfolio value gain $431.5m vs $745.9m down 49%
- Underlying profit $301.8m vs $255m up 18%
- Revenue $1b vs $1.25b down 20%
- Expenses $796.3m vs $ 532.6m up 50%
- Total value of assets $12.5b vs $11b down 14%
- Final dividend none vs 13.6 cents per share
Group chief executive Richard Umbers said it was a solid result.
"As we look to achieve positive free cash flow by FY25, as signaled in our strategy, we have reprioritised our development programme over FY24 and FY25," Umbers said.
"We are also taking steps to refocus our future pipeline on lower density villages with lower peak debt and an improved cashflow profile. And we are right-sizing our care offering in future villages, but remain committed to providing a continuum of care for all Ryman residents."
As part of the strategy, Ryman moved to strengthen its balance sheet in February, raising $902 million through a one-for-2.81 accelerated pro rata entitlement offer of new ordinary shares.
Over the year ended March, Ryman invested $1.04 billion in portfolio development and finished the year with net operating cashflows of $650.8m, resulting in a free cash outflow of $389m.
Ryman currently had 14 villages under construction, which was down by two on the prior year.
It was also reporting progress on development of a number of village main buildings that had been delayed due to Covid-19.
Underlying profit for FY24 was expected to be in the range of $310m-$330m for FY24, in line with the guidance provided at the time of the equity raise.
The company expected to appoint a new board chair in the near future.
The board would also consider the resumption of paying dividends in FY24, taking into account trading performance, cash flow and market conditions.
"The strength of the Ryman team gives me every confidence that we will deliver on our care promise, reposition the business to capitalise on future opportunities and improve financial performance," Umbers said.