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Arvida on expansion drive, doubles profit

NZ Newswire logoNZ Newswire 24/05/2017 Tina Morrison

Arvida Group, the retirement village company that listed in 2014, more than doubled annual profit as it expanded its offering and benefited from a buoyant property market.

Net profit rose to $53.7 million in the 12 months ended March 31, from $24m a year earlier, the Auckland-based company said in a statement.

The latest earnings were boosted by a $39.3m gain in the value of its investment properties, ahead of the $19.1m gain booked the previous year. Revenue in the latest year increased 23 per cent to $101.4m.

Underlying profit, which excludes changes in property values and other one-time items, increased 47 per cent to $23m.

Arvida is expanding its portfolio as it seeks to benefit from increased demand for care due to an ageing population.

The latest earnings were boosted by a full year's contribution from the three villages it acquired in the 2016 financial year as well as partial contributions from five acquisitions completed in the 2017 year, taking its total number of villages to 26.

The company's total unit or bed numbers increased to 2747, up from 2154 a year earlier.

It plans to develop a further 262 new units or beds over the next two years, and currently has about 100 units under construction, with a further 645 in the planning stage.

It announced on Wednesday that it has inked a conditional agreement to pay $11m for 8.2 hectares of bare land in Richmond, Nelson, which would cater for a $100m retirement village and integrated care development.

"We continue to see a range of acquisition prospects and will continue to actively consider opportunities that meet our criteria in terms of location, quality of assets and current management, potential for development and earnings accretion," Arvida chair Peter Wilson said.

Occupancy rates at the company's villages was maintained at 95 per cent.

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