New Zealand’s second-largest listed retirement village owner-operator has reported a substantial increase of 62% in bottom-line profit. Summerset Group, listed on the NZX in 2011, achieved a net profit after tax of $436.3 million in the full year ending December 31, 2023. This marked the second-highest profit in its history, propelled by a 64% rise in portfolio revaluations, defying the downturn in the housing market. However, expenses witnessed a 17% increase, climbing from $225.4 million to $263.8 million, inclusive of an additional $9.9 million attributed to higher wages and rising costs of insurance, rates, and electricity. The impact of higher interest rates led to a 62% surge in net finance costs, escalating from $17 million in the previous year to $27.5 million in 2023.
The company holds a bank facility of $1.5 billion and $450 million in retail bonds. Shareholders will receive a final dividend of 13.2 cents per share, to be paid on March 22, surpassing the 2022 interim dividend of 11.6 cents per share. Positioned as the second-largest company, following Ryman Healthcare, Summerset Group operates in both New Zealand and Australia, led by CEO Scott Scoullar. Despite a challenging macroeconomic environment in 2023, characterized by rising inflation, recruitment shortages, and a declining residential property market, Scoullar expressed satisfaction with the company’s performance, noting resilience and continued growth.
Summerset achieved a record of 1,103 property sales through occupation rights agreements, marking a 10% increase from the previous year. Scott Scoullar emphasized that this outcome underscores the company’s ability to grow, emphasizing that, despite the impact of the residential property market on their business, the robust sales performance and a strong demand pipeline showcase their resilience and independence from sole reliance on the property market for growth.
