There sure hasnt been much divergence yet,looking at the 2 charts.
They look joined at the hip so far:)
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There sure hasnt been much divergence yet,looking at the 2 charts.
They look joined at the hip so far:)
[QUOTE=couta1;462911]The whole retirement sector is a bit subdued currently so what increase in share price should we expect after next weeks results? Your guess is as good as mine but I'm confident if you hold the stock over a 5 year time frame you'll double your money or more[/quite]
Im sorry to be so blunt Couta but I dont think you are in the position to be giving anyone investment advice. Ive sat by watching all the ST gurus mother you out of pity after your losses and silly buys only to be followed by you preaching your 2 cents of f-all. Like me there are many newbies who look to ST for advice & input of VALUE to make decisions- however you have not yet presented any value- just hype and ramping. I fail to see why members like snoopy who are genuinely trying to learn and add value are bludgeoned while people like you are mothered for being a loser (moneteraly). Newbies take heed- a coin will do you better....
[QUOTE=Ginger_steps_;463185]Ginger steps your out of order with your post above and just plain rude,those that have lost large sums know how tough it is to work through,do you? Help from others is much appreciated during these tough times,I'm not going to defend myself other than to say I've had 24 years working in the retirement sector including Summerset and Ryman homes and know their inner workings inside out and upside down so yes I have a valuable opinion to share,do you? And just to make you happy Summerset is a buy and hold okay ,now how's that for good advice
I'm absolutly with couta1 in this matter and rarely if ever report a post but Mr Gingerbread man that was extremly harsh and uncalled for so has been reported by me. Try and act like a gentleman with a spirit of mutual respect and goodwill for your fellow members or go elsewhere to another forum, how's that for some straightforward advice !!
[QUOTE=couta1;463206]Agreed it was harsh. however I maintain that your knowledge of the market is not sufficient to be offering advice. Just because youve been changing bed pans for 24 years or anything else in the companies doesnt make you a financial advisor. Again it comes back to the value where i believe you have offered none. Yes ive lost a substancial amount before (due to greed and lack of knowledge- much like yourself) and agree support is good, however its because of this fact I dont offer advice or suggestions.
It was just a quick look at the two on the DB charts,especially the last few months where they both spiked and then both settled back to almost exactly to the 100day moving average.
It was just a quick observation
https://www.directbroking.co.nz/Dire...uote=Go+%3E%3E
https://www.directbroking.co.nz/Dire...uote=Go+%3E%3E
You may be right about the coming months--theres probably more of a chance they will diverge than correlate
Sorry--those links were supposed to be the charts (have to use drop down box)
So Couta, Id be interested to hear what you did in these firms and what motivated you to make your prediction.
They both obviously have lots of villages and working in one is not always an indication of the business overall,but having said that,often workers get a relatively good feel of how things are going--Do Share
I have not done in depth research into SUM but there are some other factors i would certainly look into aside from good management
Interest Rates--Do they have alot of debt on their properties? (we have been given a pretty good indication that they will rise)
Which leads to the second-the property market in general--How would a downturn affect them?
And last -the overall markets--How badly would a sizable correction affect them?
These factors have been pretty sweet so far--will they continue for another 5 yrs?
If they do,then I suppose management becomes the major issue to consider--If they dont,then the equation becomes a bit more complicated.
People still get old and need accommodation so Im relatively confident they will still be around in yrs to come,but growth in profits can be affected by many things. IMO
All market wanes and waxes respond to economic cycles, including the property and share markets, and are mostly all correlated anyway. The secret of a long term hold is to stick with outperforming stocks.
The retirement sector has some degree of immunity also, the respectful elderly when they purchase are not buying property, they are buying aged care and security in knowing they will actually be taken care of in the twilight years, or, they are buying some degree of access to this security in advance anticipating requiring it in a few years.
You can’t take your wealth with you but you can end your days with dignity and respect, and your kids would probably just buy a sport’s car or go on an OE.
Just ten reasons why Summerset will continue to outperform;
1. Accelerating growth (an additional 200 units/yr in 2014 to 300 units/yr in 2015).
2. The aging demographic driving sector growth.
3. Baby boomers the wealthiest generation in human history.
4. Increasing net margins.
5. Award winning operational performance.
6. A sales and marketing premium for being the best in breed.
7. The highest ratio of villages within the lucrative Auckland region.
8. The highest land bank, also in key areas.
9. Revenue funded growth with only cashflow debt requirements.
10. Proven growth and goal focused management
Not to mention that SUM is undervalued at present.
A lot of that baby boomer wealth (especially in NZ) is based on surging real estate prices. As the "demographic bulge" of boomers decide to cash in on their properties to buy a Licence in a SUM complex (or just to downsize or cash-up their investment properties etc) do you think the decades of boomer-fuelled house price growth may come to an end? I think that there could be a real risk to what many have come to assume to be chronic out-performance of residential real estate. Asset revaluations could turn negative. I agree with all your other positive points with the caveat primarily on this point 3.
I think you've got a point there, Bj. While the average house price, particularly in Auckland, probably enjoys a healthy margin over the average cost of a retirement villa, apartment etc at present , the question may become whether that margin remains sufficient to buy that licence and to finance the ongoing costs of retirement village living. I've taken stakes in the three listed companies but they're only a part of a diversified portfolio.
It’s a healthy and interesting debate to have I think as it’s all a bit unprecedented in New Zealand history.
Certainly the boomers coming out of the property market will free up stock for generation x, but I agree at some point in time, could be ten years from now the property market will die as demand falls away. Remember all those school closures in the 1980’s and early 1990’s after the demographic shift occurred and the boomers had passed through.
Having said that, I see the aged care retirement village as being in the same bucket as hospitals, if the property market were to take a dive, the land value of a hospital would drop but this only represents 1 or 2% of the total site value, a hospital is valued in the healthcare sector not the real estate sector.
Similarly the value of the land an aged care retirement village sits on will drop, again it’s only 1 or 2%, but the aged care facilities on that land is in the healthcare market, and not in the commercial real estate market or in the residential real estate market.
Also, I’m inclined to anticipate that for a senior respectful elderly person living in a modern world where their children won’t change their nappies, their priorities are increasingly going to be on security of care first and inheritance second. The boomers cash will most probably prioritise toward their own care before any surplus from the sale of their house is allocated.
Quote:
MAC said - Certainly the boomers coming out of the property market will free up stock for generation x, but I agree at some point in time, could be ten years from now the property market will die as demand falls away.
One of the big issues is that those Xers or 13ers are now at the peak f their earning cycles and have realised that are about to or have inherited a poor economy and a ravaged environment. They blame the generations before them.
It is likely that most of his generation will not match the economic fortunes of their baby boomer parents. It possibly is not a generation that feels it should pay the dues for people in the past - not good for baby boomers.
Some generational theorists (notably Howe and Strauss) point out that history shows when generational cycles such as this happen depressions if not deflating happens. Imagine the wealth of baby boomers (as you say the richest generation in history) sees asset prices falling away.
One outcome is a return to multigenerational living as seen in Europe in the past. - grandparents and parents and children all sharing the same house and caring for each other (particularly granddad or nana)
Only time will tell us how al his evolves over the next 5 or 10 or 20 years.
Retirement villages might be necessary for quality living or they might just be glorified nursing homes. Who knows.
If interested in generational trends and multigenerational living here's an interesting insight
http://www.enlightenmentmag.com/tren...ational-living
Extract -
A record number of Americans live in multi-generational households today, according to Generations United™ (GU), a national organization focused on improving the lives of children, youth, and older people through intergenerational strategies, programs, and public policies.
Although the trend began before the economic downturn, the Recession has fueled a dramatic rise in U.S. multi-generational households from 46.5 million in 2007 to 51.4 million by the end of 2009 – a 10.5 percent increase in just three years.
Good point highlighting the risk of property values dropping when all the baby boomers try to sell them. On the other hand - assuming our politics stays rational, New Zealand has due to its space, climate and still sort of green reputation the natural advantage of being a desirable destination for well contributing and hard working immigrants. If we manage this immigration flow to our advantage, than it shouldn't be too hard to keep property prices in a desirable band. If they drop too much, open the immigration tap - and if they go too high, reduce the flow. Quite simple, isn't it?
Re boomers etc, remember that retirement villages aren't targeting everyone. Due to huge numbers of them, they are only targeting the wealthiest 20% (excluding the top 5% who will pay to continue living in their mansions). These will own their own freehold, and have investments on the side.
Those with only their own home or those living in multigenerational living are not the target.
I concurr with Mac's ten points above.
$500m investing in Auckland creating 1300 units = circa $385,000 average price inclusive of other village amenities.
On the subject of affordability and future house price movements isn't the average Auckland house now somewhere over $600,000 ?
Pretty comfortable margin of safety there I would have thought.
Does your ''revenue funded growth with only cash flow debt requirements" mean that their properties are basically free hold so they are not to tied to raising interest rates?
(Just trying to get an idea of their debt levels)
Disc. Still in the research stage --good points Mac
I’m not an accountant Skid but I do know construction, this is my humble understanding to share;
Summerset are as much a construction company as a village operator, they have access to 180M in available debt facilities as working capital if so required. Although it does not appear that they typically have utilised this facility fully over the last few years with borrowings typically closer to $80M.
They secured an increase in debt facilities in 2012 from $150M to $180M which allowed them to more comfortably accelerate and manage a planned increase in their build rate target from 250 units/yr by 2016 to 300 units/yr by 2015.
In 2012 they constructed $72M in new village assets with borrowings of $78M. This seems to be an annual reconciliation with working capital quickly paid down from revenues.
IMO it is a sign of a pretty good business model when your construction working capital is paid off annually from revenues in only twelve months or thereabouts.
http://www.summerset.co.nz/assets/In...h-site.sml.pdf
Summerset presently have $706M in assets under management.
Attachment 5530
Skid I can't say exactly what I do in these companies for various reasons including having contracts to work in competing companies and not biting off the hand that feeds you, I have worked in 18 different retirement complexes over the years including 2 Summerset and 2 Ryman facilities,others include Bupa,Oceania,Presbyterian support,Terra Nova and various small private operators,never worked in a Met home to date though, so I've done a thorough study of the different continuum of care models,management structures,management operating styles,staffing operations including staff-management interactions and delivery of care standards etc, I have observed various changes over the last 2-3 years in certain companies in a negative way and others in an increasing positive way,so with my position on Sum I think you can draw your own conclusions,my wife also has extensive experience in the sector.
I take a bit of comfort from that Couta1, thanks for sharing. After seeing how my Dad was "cared for" in a dementia unit in Ryman's Orewa facility, I no longer own Ryman shares. In terms of SUM it certainly has the feel good factor investing in a company that's confirmed best of breed by independent awards at looking after its residents. Two days to go to the annual result, anyone else feeling a little excitable, or is it just me :)
According to Summerset's website, "Summerset has been named Best Retirement Village Operator in New Zealand and Australia at the Australasian Over 50s Housing Awards for four years running".
I have nothing against SUM at all and I am currently invested heavily in New Zealand's retirement sector. I am however sceptical about just how independent these awards are.
The awards come from an Australian based publication called Housing Care Aged Weekly. Refer http://www.seniors-housing.net/ They market themselves as a "Reuters level service" and this is their "Australian Edition", although I can't find any other edition in existence. A sample of one of their publications is here http://www.seniors-housing.net/core/...CHW-Sample.pdf
Looking at the awards on the 1st link above, there was a 2010 and 2011 award, both won by Summerset. But only nominations were called for for 2012 (with a closing date of 10 Aug 2012 for the nominations) with no winner yet, and there is no mention at all of 2013 or 2014 at all. Despite the sample in the 2nd link above, I didn't get the feeling this is a very big publication.
Around July last year, Housing Care Aged Weekly wrote an article besmirching RYM's proposed Wheelers Hill Village in Melbourne. They called it a 'Foray' and went so far as to call it a 'financial suicide mission'. The article also went a long way to misinterpret MorningStars comment on RYM's Wheeler's Hill village. Refer http://www.sharetrader.co.nz/showthr...l=1#post414737
Due to this article, I dug a bit deeper and found what I believe to be an undisclosed tie-up between Housing Care Aged Weekly and New Zealand's Summerset Group. I can't remember exactly what I came across but the tie-up seemed pretty clear to me at the time and I was not surprised to find it. I would be astonished to see any Australian based publication in any sector recognising New Zealand in front of itself for even one year let alone four. There are hundreds of aged care companies around Melbourne alone let alone the rest of Australia yet little known Summerset keeps winning? Ask any Australian in any Australian City if they have heard of Summerset. I can tell you what the answer will be, especially with no Summerset presence there yet.
In any event, due to my findings the credibility of this award, in my mind anyway, went out the window.
Excellent sleuthing Vaygor ; great to see some fact uncovering some fiction, thanks
Here is the actual website for the organisation that operate the industry awards for those who may be interested in the real facts about the facts.
http://www.seniors-housing.net/
The awards have been operating for 14 years with 80 retirement village companies entering covering 1,200 villages in Australia and New Zealand. The judges apparently have 28 year’s experience within the industry.
Vaygor, it was actually Morningstar that independently provided that opinion of Ryman, not the industry magazine that published and ran the story, although the magazine seems to somewhat agree as do I and probably many others.
“MELBOURNE: Morningstar has issued an equity research report on Ryman Healthcare Limited (RYM) which raises the spectre of its promulgated Australian foray being a drag on its future results. This journal has long held the view that Ryman's proposed Wheelers Hill Continous Care Retirement Community is a financial 'suicide mission.' Ryman management has been blindsided”
Having moved from Victoria to New Zealand shortly after Ryman announced their Wheelers Hill initiative I was equally perplexed as to why Ryman would ever want to enter Victoria of all states, I’m not sure I would go as far as to say it was financial suicide, maybe naive and under researched perhaps.
Still I think Ryman will make it profitable because they have too, it just is quite unlikely to be nearly as profitable as if they had invested that same cash in the New Zealand market.
Personally I'd find your sleuthing more believable if you can document the alleged 'link'. You are accusing them of self nomination, and parochial judging, without any evidence, (so far). I think you owe us proof.
there are many sector awards handed out, where nominations are made by industry peers, with judging performed by an 'independent' judge.
Just one example is our local finance industry, the INFINZ annual awards. Nice recognition but would you change bank or broker on that basis?
In any event, I personally put no weight on industry awards anymore, just look at who have won the Exporter of the year, and CEO of the year awards in the past. Remember Fortex?
Vaygor1 - Yes I see you've made that unsubstantiated claim about an alleged tie up
before and have been grinding that axe for a while now without proof. Yes it appears the website of Housing Care Aged weekly needs updating on that point alone I agree with you.
Frankly unless you can back you assertion of a tie-up with facts its nothing more than
a slanderous and baseless allegation.
Vaygor1 has a clear preference for Ryman when you read all his posts and he's entitled to it but this is a Summerset party here so get the drinks lined up ready for tomorrow,price has already started to creep up while Rym is heading down:cool:
Hi all.
Your reaction in the last few posts is not unexpected given your interests in Summerset, but what I have given you is the truth.
I do not favour SUM, RYM, MET over each other and there is no slander in my post. I have stuck to the facts. I would like to see the last two years of these awards if they exist, but I can't find them. Surely if they existed they would be well publicised, or at least updated on their own website.
I shall see if I can find the connection I found back in July last year and report back.
There are a couple of other things you should know about this award:
- Only those villages nominated by someone are 'evaluated'
- I can't find an historical campaign aimed at attracting nominations except this one website which I find to be discrete
- There is no stated evaluation criteria
- There is no judges named.
- There is no documented decision making process
- The website itself, any of their publications, and awards themselves do not name a single person, manager, or organiser who you can contact.
I mean, click on http://www.seniors-housing.net and select 'Awards 2012' on the left. Who is this judge? Any committee of such a prestigious award would want the judges name with all his experience up in lights wouldn't they? Something doesn't add up.
As for just how bona fide the independency if this award is doesn't bother me an iota except for one thing and that is it calls into question just how much the CEO or board of Summerset are prepared to bend the truth on whatever they report, and this in turn impacts my level of investment in them.
If there is a rat here, and I certainly smell one, then we should all be aware of it. I have tried to get to the bottom of it and I can't.
MAC, the reason RYM entered Victoria is a simple one… Melbourne demographics.
Leo Campbell won the 2013 Architecture Award at a ceremony last November - from the publication linked.
No mention f other winners in this publication but we know Summerset won the supreme award
Vayoger ....you should know better than to piss off the believers ...it does seem to rile them even if there is some truth in your outrageous claims. Must admit Summerset seem to get good coverage in this publication
I did a little research on who owns the domain and who owns the domain of the parent company. I found similar sites in the UK, US and Canada (http://www.seniorshousingcanada.com, http://www.seniorshousing.co.uk, http://www.seniorshousing.us/).
Domain and or company names all seem to be related - Bevan Crowley, Ann Crowley or Liam Crowley...and the expert who does the judging, editing and public speaking is Edmonde Crawley (http://www.seniorshousing.co.uk/core...erProfile.html).
Edit: Oops mistype it is Esmonde Crawley
I think you are correct Vaygor, too simple;
Victoria compared to New Zealand:
Very aggressive unions
Higher construction costs
Longer construction times, working capital tied up for longer
Higher operational labour costs
Lower labour productivity
I’ve first hand experience with union negotiations in Vic and I can assure you they will fire and at a time of their choosing to achieve a maximum return for their members. Even Australian companies entering Victoria get burned badly let alone a company from New Zealand where we have little cognisant exposure.
The closest analogy I have, for those of us long enough in the tooth, is a comparison to the industrial relations we had here in NZ in the 1980’s. They don’t have compulsory unionism like we did here in NZ, but in Victoria they effectively may as well have.
Of key importance for Ryman is to ensure that the site employment bargaining agreement they have for construction does not roll over into the operation of the village. This could occur immediately or at any time after.
I would also be interested in some feedback from Ryman as to whether the build was on time and budget. Projects in Vic have a history of being over, often 50% over is not at all unusual. Construction labour productivity is often only 30% of that in other states.
The risks are enormous in such a labour dependent sector as aged care, and this is what the analysts and industry commentators are referring too.
I’m very pleased actually that Norah Barlow looked at the Australian market and strategically decided against it. Until proven otherwise my anticipation is that gross margins will be lower in Vic than NZ, either way, Julian Cook will have a good zero cost guinea pig to study at Wheelers Hill.
Well said mate.Quote:
I’m very pleased actually that Norah Barlow looked at the Australian market and strategically decided against it. Until proven otherwise my anticipation is that gross margins will be lower in Vic than NZ, either way, Julian Cook will have a good zero cost guinea pig to study at Wheelers Hill.
Close winner69
Quote:
Financial Results for the Year Ended 31 December 2013
8:30am, 25 Feb 2014 | FLLYR
NZX, ASX AND MEDIA RELEASE
25 FEBRUARY 2014
SUMMERSET GROWTH CONTINUES - UNDERLYING PROFIT UP 46%
- Underlying profit for FY13 of NZ$22.2 million, up 46% on FY12
- Net profit after tax of NZ$34.2m, up 131% on FY12
- Net operating cash flow of NZ$88.6m, up 34% on FY12
- Total sales of occupation rights up 21% on FY12
- 209 units delivered, 31% increase on FY12
- FY13 final dividend of 3.25 cps announced
Retirement village and aged care operator Summerset today announced underlying profit for FY13 of NZ$22.2 million. This result is a record for the company and represents a 46% increase in its underlying profit on the prior year.
Net profit after tax for FY13 was NZ$34.2 million – 131% above FY12. This figure includes $8.4 million of gains in the fair value of greenfield land held in Auckland as well as the benefit of income tax losses of $2.2 million being recognised for the first time, given continuity around shareholdings going forward.
Summerset has also announced its annual dividend for shareholders of 3.25 cents per share. This represents a total dividend of NZ$7.0 million, an increase of 31% on FY12.
The dividend reinvestment plan will apply to this dividend, with a discount of 2% applicable to those shareholders participating in the plan.
Managing director and CEO Norah Barlow said 2013 had been a year of high growth for Summerset and she was very happy with the performance of the company over the period.
“We purchased five new sites in 2013; Lower Hutt, New Plymouth, Casebrook and Wigram in Christchurch, as well as additional land adjacent to our Trentham site. We welcomed our first residents to Dunedin and Katikati, and have started construction on our Karaka and Hobsonville sites.”
The company is working through the planning process for its Lower Hutt, Ellerslie and New Plymouth villages, as well as the two Christchurch sites. New sites acquired in 2013 lift Summerset’s land bank to over 2,100 retirement units.
“Care continues to be a focus for us and new villages will have larger care facilities as we move forward,” Mrs Barlow said. “We are always looking at innovative ways to meet our residents’ care needs – care apartments are one example of this. These are apartments that have been certified by the DHB to provide rest home-level care to residents in their own home.”
The company saw its third year of record sales with a 21% increase in the sales of occupation rights for 2013. Gross sales exceeded 400 units for the first time with sale proceeds reaching over NZ$130 million. This compares with gross sales of $102 million in FY12, a 28% increase.
Mrs Barlow said demand was strong across all 18 villages. Summerset was working to meet that demand by supplying new units quickly. This was demonstrated by the completion of 209 units built across six sites, up 31% on the previous year.
“Our results this year were driven by our in-house design and development capability, strong sales and our continuing reputation as the best retirement operator in Australasia, an award we have won four times in a row,” Mrs Barlow said.
In November 2012, the company upgraded its longer term build rate to 300 retirement units per annum by the end of the 2015 financial year. Guidance given during the IPO was for 150 units per annum by 2016.
Mrs Barlow is to retire in April, and current CFO Julian Cook has been appointed to replace her. Mrs Barlow will remain on the Summerset board of directors.
CEO-designate Julian Cook said, “With a strong development pipeline, in-house development and design teams, we are well placed to reach our targets going into 2015.”
“We are always looking for new sites on which to build, where we can create vibrant and active communities to serve the local area. We have plenty of room for further growth.”
The value of the company’s total assets has grown 20% to NZ$845 million from NZ$702 million in 2012.
Summerset chairman Rob Campbell said Summerset was continuing to perform well.
“Summerset’s development capability, which has been enhanced by taking development and design in-house over the past few years, is a key part of this growth. Demand for our villages is strong across the country and our ability to deliver new units in a timely fashion to residents is key to meeting this demand.
“The board has welcomed two new directors recently, with Marie Bismark appointed last September and Anne Urlwin commencing in her new role on the 1st of March this year. Both of these directors bring significant experience to the board and will be valuable additions. The board is now well placed to carry the company forward following the exit of QPE Funds Management in 2013.”
This is the company’s third set of results since it listed on the New Zealand Stock Exchange in November 2011. Summerset became part of the NZX50 in December 2012. It is also the company’s first set of full year results since listing on the Australian Securities Exchange (ASX) in July 2013.
ENDS
Solid and credible result. Significant land acquisitions this year positions the company extremly well for long term growth. Land bank of 2100 retirement units is 7 years supply based on the projected 2015 build rate of 300 units per annum so the foundations for superb long term growth have been laid in 2013.
Happy to hold long term. (Rome wasn't built in a day).
A sunny day at camp Summerset,all ducks in a line,let the growth curve continue
A good result, an NPAT increase of 131% certainly exceeded NZ First Capitals anticipation of 68% and probably most of the market’s.
Build rate target of 200 adequately met, new unit and resale's up well also.
I particularly like the advice on the increase in build rate expectation from 200 units to 250 units for 2014.
An exceptional report really, onward and upward.
http://www.scoop.co.nz/stories/BU140...th-village.htm
Really like the result. SUM is sitting nicely in my looooongterm portfolio.
^^ LOL Revenge is sweet :)
Now given that the second line up was at $3.17 and the bottom line was at $3.05 you're guess is wrong.
But well done for buying.
My last buy was at $3.28 but that was last November.
Result looks promising for Summerset being able to live up to the expectations we all seem to have for it.
Best Wishes
Paper Tiger
So you've worked in the retirement industry, are moved along a lot could work in the sluice room who knows as you don't want to share and thats fine. Yes of course we can draw our own conclusions. Thanks.
Looks like the Retirement ind in fine fettle.
Bit disappointing that result today ... below my expectations anyway
ratkin said fully priced and earnings need to catch up. I agree so in the meantime at best just a steady rise in shareprice, nothing spectacular from here
Update on linear regression channels - avoided going below the bottom channel line last week. Todays rise still has price below the actual trend line ($3.58). So still in with this 2 year trade. Long may it continue at the 0.85% per week rise ..... no acceleration I am afraid. That growth rate is about the rate of earnings growth so if fully valued expect a pullback of sorts. If world markets collapse SUM will have a 2 in front of it
Omg these guys have no idea do they.
Nobody has ever responded to me whether they see the possibility of perceived super profits being reined in by an unfriendly government as a risk to investing in sum or RYM.
And I am not da facts
From NBR
http://www.nbr.co.nz/article/summers...52385#comments
#1 by da facts 7 hours ago
Is it just me or is making super profits out of old people a bit off. A big non for profit business should be launched (e.g Southern Cross type) to keep this activity in check.
by Share Watcher 1 hour ago in reply to da facts
So what's stopping you then?
#2 by Anonymous 4 hours ago
I couldn't agree more with "Da Facts" we were interested in looking at one of their units, but having been in the construction industry all of my life, there was no chance in hell I was going to pay that sort of asking price for one of their units, they are extremely poor value for what they are, it is a shame that the frail elderly are being separated with their money in favour of massive profits to a corporation that has no conscience.
Take the profit before tax (NPBT) deduct the fair value movement of investment property (revaluation gains) and:
FY2013 SUM made a NPBT of $2M0
FY2012 SUM made a NPBT of -$0M7 (loss)
So currently SUM is a de facto non-profit provider of retirement living accommodation and services.
The perceived profit is just the normal increase in the value of property and land.
MET is much the same.
Now RYM is a different beast entirely they made $31M3 NPBT of real money for FY2013 and another $16M4 NPBT for the first half of this year. But that is not particularly a great return on 1.8 billion dollars of property or even 780 million dollars of equity.
So not a lot of profit to cut anywhere.
Best Wishes
Paper Tiger
Disclaimers:
1 - Own MET, SUM & RYM (specified in strictly alphabetical order)
2 - Nothing in this post should be construed as criticism of, or preference for the retirement sector in general or specifically; nor as criticism of, or preference for any particular retirement village operator, listed or unlisted, for-profit or not for profit.
Winner before any Government would have a right to be concerned with any super profits which PT has pointed out don't exist they would have to address the current and ongoing large underfunding issue created by themselves running at around 500 mil/year currently
As MAC says they are really just a property developer any way. As PT says doing things in the developments they have created is really just a de facto service.
As a property developer this guys view is a worry then. Anonymous (like MAC says I
He in construction
I couldn't agree more with "Da Facts" we were interested in looking at one of their units, but having been in the construction industry all of my life, there was no chance in hell I was going to pay that sort of asking price for one of their units, they are extremely poor value for what they are, it is a shame that the frail elderly are being separated with their money in favour of massive profits to a corporation that has no conscience.
The money given by the MOH to the DHBs which is distributed to the retirement village operators to fund their care centers is in a funding shortfall winner to the tune of 500mill/year currently ,and will have just increased with the raising of the minimum wage as part of this funding is mearnt to cover staff wages also.
Good article in this mornings Dom Post from Summerset,40 years of growth ahead etc
just a follow up on the suggestions vaygor1 made recently in this forum (post #1279 and #1285):
I contacted SUM following these allegations and received a response directly from Julian Cook. He clearly states that they (SUM) have no relationship with the organiser of this competition and he points out that during the 15 years this contest is running as well RYM and MET have been under the winners for some years as well. He highlights that selection of candidates or judging criteria are a matter for the organisation concerned (i.e. seniors-housings) and that they (SUM) have been only informed after a decision has been made by the panel.
Still waiting for a meaningful response from seniors-housing and shall keep you posted if anything relevant eventuates.
Is he considering the cost of the complex as a whole? He is definitely missing that the property development side of the business has to subsidise the care side of the business. Personally I think the frail elderly see this whereas the greedy property developer doesn't. They aren't buying a 'house', they are buying a licence to occupy in a facility that will give them greater care and security than if they continued to live in their existing home.
A personal experience - case study.
I encouraged my parents to move into a retirement home in Whangaparaoa about four years ago. The Peninsula club was the best fit for them with their friends in the community there and close to their Church. I negotiated the price down for them to $360,000, which I consider very reasonable for a stand alone north facing 112 sq metre condiminium with views and a lovely sunroom. They enjoy investment income from a reasonably sized fund that I manage for Mum as a result of the sale of their modest unit in an adjacent suburb and also bought a new car and some travelling out of the net sales proceeds from their modest home.
Dad passed away late in 2012, we knew he had Dementia at the time they moved in. I knew my Mum would be alone in due course at the time when I encouraged them to move in.
Mum has enjoyed tremendous support from the existing friends, new friends she's made there and from the staff and is as happy as you could possibly expect for an 85 year old who lost her huisband of 56 years marriage fairly recently. She finds the support and safety and organised activities and facilities there invaluable and often remarks to me what a vast difference its made to her life compared to how it might have turned out, alone and somewhat isolated in a unit in Red Beach.
She travels more now and I am picking her up from the sirport today from a trip of three weeks when she's been down to see her sister in dunedin. She knows she will come back to well cared for grounds, her condimium will be safe and not burgled during her absence and she can reaquaint herself with all her friends again in a safe caring commiunity of like minded people.
In my view, the move for my Mum has been a trememdous sucess and gives me a huge amount of peace of mind knowing she's well connected and cared for in the community.
Sounds nice Roger. I almost want to age a bit quicker so I can get there myself.
Thanks for sharing your story Roger. I think too often we underestimate and undervalue the comfort and security the retirement villages provide for some of the most insecure and vulnerable people in our society. They all deserve nothing but the best.
Thanks Roger.
Sums up perfectly what the retirement sector is driven by.
Thank you for sharing that Roger, appreciate this type of input, which I think brings intangible facets which are equally important.
Side note: Volume up 413,649.
Great for you and your parents Roger. With care I'm not so sure. Folks with parent/s with dementia need to look thoroughly at all options. Ryman def didn't work for us and we are really happy with a private operation. No comment on Summer set as not in our area.
Keep posting Ginger; we need some balance here:)
Good post Roger. My Mum is on her own in Orewa after my Dad died, but she doesn't want to 'give up her independence'. I might show her your post.
I think there has to be a paradigm shift with some of the older generation. They need to free up their capital to invest in their retirement as the Govt and the working force will not be able support them.
Enter heartland and their plans to reinvigorate ,rework ,refresh annuity ,reverse mortgages.
If i was asked to advise it would be to visit a number of times at different times of the day , observe, and listen ; one can form an unbiased opinion of whats really happening. Be careful asking staff and some residents as it may not necessarily be accurate. Watching to see if residents needs (esp dementia) are being met. Are staff run off their feet and so order residents around e.g. you must shower now. Are staff friendly, happy , speak clear english, how many diversion therapists are there etc etc.
Right Couta - I bit my lip when you dodged the question about your involvement in the retirement sector but after this post of yours I will continue.
Its blatantly obvious from this post you are a simple carer who has upskilled along the way - but never making it out of a hands on position - maybe at the most you have made it to head nurse. This gives you a tiny insight into middle management and nothing thereafter.
Furthermore I wasn't only commenting on your inability to crunch numbers - I was commenting on your INABILITY TO ADD ANY VALUE to this thread, coupled with your complete lack of share-market knowledge - whilst giving advice to others to BUY (which angered me considering your record so far). Yes, Roger having never worked in a retirement complex (I assume) did just add value - a great deal more in a single post than you have collectively(Thanks Roger). You'd think after all of those years and 18 complexes you would be able to at least provide some strengths and weaknesses or even simple differences of said companies but haven't - not even a tiny whiff of value in ANY one of your posts. Which I might add could be done with absolute anonymity.
Now I would like to lay this to rest so that we dont continue cloud the forum with rubbish imberteen valued posts by knowledgable members. So before I climb back into my viewing platform - do you care to share some value with us now? Heres your chance to ADD some value!! Failing that I can only assume that you indeed do not know anything past caring for patients and therefore should not be advising unknowing newbies or anyone on ST to BUY without any credibility or facts - other than comments you've regurgitated from VALUED members of ST. At present I think you are using ST like facebook - where you'd be better of posting your breakfast updates. Two eyes, Two ear, 1 mouth - use them in that order buddy.
Thanks Joshuatree - dont worry, I only post when I feel strongly about something and a cheeky Fugazi sure wont stop me. On a side note may I ask why Ryman didn't suit your family?
Sometimes I wish people would just admit they made a mistake and/or let it go, rather than making this thread look like their facebook feed...
I know I dont contribute, but it would be great to be able to read all the valuable information on this thread without wading through all the pointless posts (like this one)
irony.
Unbelievable ginger steps that's all I've got to say in reply,have a nice day and I will continue to post as others on here seem to appreciate someone who's has a long experience looking from the inside out and who has studied the inner workings of these facilities and understands the funding model and continuum of care model etc,cheers
I don't post often and anyone looking at the threads of my posts would think I'm pretty light on analysis. Yet I spent many years as a sharebroker and I find little reason to list my credentials however part of my history was establishing Renouf & Co in Auckland back in the 80's and I must say that I just love the diversity of contributors to this site and you couta1 are counted in that pool - keep it going!
My experience from when my relative was in a home is that the carers are anything but simple. As this remark may illustrate...they are often undervalued. A carer's point of view of a company in this sector would be invaluable - even more so if they had experience in several companies.
I have to agree entirely with the writer there is too much of "claptrap" going on, it would be far more appreciated,when all the "experienced" contributors stick to what they know well, and pass this valuable info on to the more inexperienced one as my self:).
Back to what matters - SUM closed at 347 today.
Good boost after yesterday's solid I no spectacular half year.
A little bit to go reach the all time high of 347 but maybe next week.
As long as the uptrend continues within those linear regression channels I be happy
[QUOTE=Ginger_steps_;464080]
Furthermore I wasn't only commenting on your inability to crunch numbers - I was commenting on your INABILITY TO ADD ANY VALUE to this thread, coupled with your complete lack of share-market knowledge - whilst giving advice to others to BUY (which angered me considering your record so far). You'd think after all of those years and 18 complexes you would be able to at least provide some strengths and weaknesses or even simple differences of said companies but haven't - not even a tiny whiff of value in ANY one of your posts. Which I might add could be done with absolute anonymity.
Now I would like to lay this to rest so that we dont continue cloud the forum with rubbish imberteen valued posts by knowledgable members. So before I climb back into my viewing platform - do you care to share some value with us now? Heres your chance to ADD some value!! Failing that I can only assume that you indeed do not know anything past caring for patients and therefore should not be advising unknowing newbies or anyone on ST to BUY without any credibility or facts - other than comments you've regurgitated from VALUED members of ST. At present I think you are using ST like facebook - where you'd be better of posting your breakfast updates. Two eyes, Two ear, 1 mouth - use them in that order buddy.
Thanks couta for your insight. People should not take whats in the forum as gospel, they should do their own research. To put these utter garbage is nonsense.
Please take Rogers advise on post #1254 if you can only be rude,disrespectful and put people down,you arrived here out of the blue from your viewing platform as you put it and yet all you have done is personally attack me for which you have been reported once already yet you haven't even talked about Summerset at all,can I respectfully request you return to your viewing platform until you can be more civil.as your upsetting people for no purpose,thankyou
You are not that dumb? No one in this forum are saying they are stockbrokers and what they say has to taken literally. You tell me what post of value you have in here. All you doing is cluttering this forum with utter rubbish. Don't like it just ship out or make some contribution which is of substance.
Riiiiiight.
So there seems to be an increasing amount of aggression across a few blogs on ST lately.
How about we just cut it out, certain people will have disagreements, some will always rub others the wrong way, the person that rubs me up the wrong way my not irritate you at all.
Lets just deal with it and have some civil discussions about the companies we invest in.
Excellent.
Now back to Summerset ........ PLEASE!