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Summerset tips big jump in annual profit

NZ NewswireNZ Newswire 27/10/2016 Paul McBeth

Summerset Group says earnings will rise by as much as 46 per cent this year as the retirement village company benefits from strong sales in a nation with an ageing population.

The Wellington-based company anticipates underlying profit of between $53 million and $55 million for 2016, up from $37.8m a year earlier, it said.

It didn't give guidance on net profit, saying there was too much uncertainty in the fair value of its investment properties.

"Occupation right sales have been strong since the half year and are a key driver of the underlying profit forecast," Summerset said.

The retirement village operator's first-half earnings were up 44 per cent with Summerset generating record quarterly sales in the second three months of the year and allowed the company to pay a bigger dividend.

Earlier this month Summerset said third-quarter sales were boosted by the opening of a building at its Wigram site in Christchurch and that new village in Auckland's suburb of Ellerslie would maintain that momentum.

The shares last traded at $4.75, and have gained 16 per cent so far this year, outpacing a 5.9 per cent gain on the S&P/NZX All Index.

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