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Ryman hits 14 years of earnings growth

NZ NewswireNZ Newswire 19/05/2016 Jonathan Underhill

New Zealand's largest retirement village operator Ryman Healthcare has posted another record full-year profit, rounding out 14 straight years of earnings growth.

Underlying profit, which excludes fair value changes from its property portfolio, rose 16 per cent to $157.7 million in the 12 months ended March 31, the Christchurch-based company said on Friday.

Operating revenue climbed 15 per cent to $261m.

Net profit, which included about $152m of unrealised revaluations of units on the back of new stock and a strong housing market, jumped 26 per cent to $305m.

Ryman's business model, which taps into New Zealand's ageing demographic and demand for quality retirement options, is so successful that it has become an industry benchmark, emulated by rivals including Summerset Group.

The company hasn't sought fresh capital from shareholders since its 1999 initial public offering raised $25m, yet has invested $2.1 billion expanding its villages since then while returning $500m in dividends.

The company had its busiest building programme on record in 2016, and while it is projecting a quieter 2017, its expansion plans are projected to surge again between 2018 and 2021, mainly driven by activity in Australia.

Operating cash flow surged 34 per cent to $312m in a year when growth was driven by record levels of demand and a buoyant housing market, chairman David Kerr said.

"Looking out past 2020, our long-term plan is to match our New Zealand build rate in Australia. We are excited about the opportunity that both markets offer."

Ryman will pay a final dividend of 8.5 cents a share, up from 7.3 cents a year earlier and lifting payments for the full year by 16 per cent.

Ryman's shares last traded at $9.60 and have gained about 13 per cent this year, outpacing the S&P/NZX 50 Index's 9.2 per cent gain. Over the past five years, the stock has shot up 258 per cent while the benchmark index gained 93 per cent.

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