Oceania Healthcare Limited Analysis

Overview

Oceania operates in the New Zealand residential aged care and retirement village sectors, offering residents villas and apartments within its retirement villages, and also providing a full range of residential aged care services (including rest home, hospital and dementia level care) at its aged care facilities. Oceania is currently New Zealand's third largest provider of residential aged care, and New Zealand's sixth largest retirement village business. Oceania is the freehold owner of 47 of its 50 nationwide sites, comprising 48 aged care and retirement village facilities and two sites held for redevelopment purposes.

Oceania is also an experienced brownfields developer of aged care and retirement village facilities throughout New Zealand.

Oceania Healthcare Limited first listed on the New Zealand and Australian Stock Exchanges on 5 May 2017 under the code "OCA".

Performance

The following information was extracted from Oceania Healthcare's full year results, released on 24 May 2024:

Oceania today announced audited Total Comprehensive Income of $70.5m and unaudited Underlying EBITDA of $82.6m for the 12 months ended 31 March 2024.

Highlights for the 12 months ended 31 March 2024

• Total Comprehensive Income of $70.5m, up 104.3% on pcp.
• Reported Net Profit after Tax of $31.5m, up 104.5% on pcp.
• Unaudited Underlying NPAT of $62.1m, up 6.0% on pcp.
• Total Assets increased to $2.8b and Net Assets increased to $1.0bn at 31 March 2024, up 9.3% and 6.7% respectively.
• Total sales volumes were up 16.7% on pcp including a 22.7% uplift in new sale volumes to 157 independent living units (ILU) and care suites.
• Operating Cashflow increased to $85.4m, 21.7% above pcp, and included total cash receipts from occupation right agreements of $226.3m, up 26.6% on pcp.
• Undrawn net debt headroom of $88.5m as at 31 March 2024 increasing to circa $100.0m as at 23 May 2024.
• During FY2024 six sites were exited or closed as part of a divestment programme, with aggregate gross sales proceeds of $21.0m.
• Post balance date, the sale of two further sites were settled with gross sale proceeds of $16.2m, and a further site is currently under conditional contract for sale.

Underlying NPAT is a non-GAAP (unaudited) financial measure and differs from Reported NPAT by replacing the unrealised fair value adjustment in property values with the Board’s estimate of realised components of movements in investment property value and to eliminate other unrealised, deferred tax and one-off items. A reconciliation is included within the Interim Report and the Investor Presentation.

Total Comprehensive Income of $70.5m and Net Profit after Tax of $31.5m for the year ended 31 March 2024 were 104.3% and 104.5% higher than the prior corresponding period of $34.5m and $15.4m respectively.

Oceania’s total assets increased to $2.8b as at 31 March 2024, compared with $2.5b as at 31 March 2023. This increase is largely due to the continued development across 10 sites during the period, as well as the acquisition of parcels of land adjacent to Bream Bay Village and The Helier. "The significant increase in total assets over the last few years has been an intentional capital investment in the transformation and delivery of quality boutique and bespoke resident amenity across the entire portfolio”, says CEO Brent Pattison