SUM - Summerset Group

[JoeGrogan]

Cheers for the updates Kiwico

[JeremyALD]

Anyone at the meeting to give us a live update. Certainly not a rush to buy & s/p down 1% today atp. Meeting started at 1pm from what i read.

Add on . You are there Jeremy ?If so thanks.

No Josh I've just read the report. Roger will gives us a detailed update I'm sure!!

[Joshuatree]

Thanks guys. S/P ended up down 10c ,125,000 through. Was it because costs are rising?

[777]

From the Herald

Summerset grapple with wage increase

By Rebecca Howard

5:02 PM Thursday Apr 27, 2017

Summerset Group's board came under pressure regarding its plans for wage-earners who won't benefit from a recent government-funded lift in caregiver wages at its annual meeting in Wellington, but said it plans to be proactive.

Earlier this month the government announced it would implement a historic pay equity pay deal for aged and residential care workers worth $2.05 billion of extra pay over four years for some 55,000 people - close to 2 per cent of the total New Zealand workforce.

Summerset chief executive Julian Cook said "we are very pleased that a settlement has been reached and that wages for caregivers and the funding to match this will come into place shortly." However, several shareholders questioned what the company was going to do about the workers who won't benefit from the deal as well as the potential flow-on effect with other workers, such as nursing staff given the reduced pay gap.


Directors Grainne Troute and Andrew Wong - both elected Thursday - were asked what they were going to do to ensure that the benefits of the equal pay settlement extended to other staff.

Troute underscored it as a challenge the board "will be grappling with" and the need to be able to attract the best quality of staff applies to all areas of the business while Wong said that people will be looking at what they earn and what it means for the jobs they do and "we will have to respond to that if we want to get the best people to do the jobs we are asking them to do."

Chairman Rob Campbell, also re-elected Thursday, stressed that the board hasn't seen the detail of the settlement and said that "some of these matters are matters for negotiation." He recognised there "will be flow-ons but exactly what those flow-ons will be I don't think anyone on the board is really in a position to say at this stage."

Cambell emphasised the company will be proactive and said "we don't see the future of this business as being dependent on low wages or exploitation. We want to have a business that is based on paying people fairly and equitably and we will do that," he said.

Academic Paul Moon initiaded last week's open letter about threats to free speech in New Zealand universities. Photo / Richard Robinson
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North Korea has a massive US army on its border performing war manoeuvres. Photo / AP
Your Views: Readers' letters
The gender pay gap could be closed in the next five years, Diversity Works CEO Bev Cassidy-Mackenzie says.
How to close the gender pay gap
In the year to December 31, Summerset's employee expenses totalled $40.5 million and made up more than half of its $71.1m in operating expenses.

Across town in a pre-Budget speech the Wellington Chamber of Commerce, Finance Minister Steven Joyce today downplayed the potential ripple effect of the government's move into other sectors. "The barrier is rightly set high because a flow-on to other sectors would mean going back to the old relativities that these workers have just won the right to get away from."

According to Joyce, "if you have a number of employers and you have people being competed for with different employers you tend to find a rate which is effectively a market hourly rate rather than something that's a bit artificial" where there's a central funding body such as the government in the case of the caregiver settlement.

Looking ahead, Summerset did not offer any new guidance at the annual meeting but did warn that it was beginning to see some impact from capacity constraints in the construction market.

"Auckland based developments are currently being delivered in a construction market which is feeling much strain," said chief executive Julian Cook. The company is insulated to some degree as it acts as the main contractor on site, but "we are not immune from these pressures completely. We have seen one-to-two month delays on some projects and have also seen cost pressures coming through," said Cook. Contractor availability is also an issue given the high workload in the market.

It remains on track for a retirement unit build of around 450 units this year, however, "shareholders should be aware that these issues exist," he said.

In calendar 2016, Summerset improved its development margin to 22.2 per cent from 20 per cent benefiting from internal management and design of its construction sites, and its larger scale. Today, Cook said there was clearly more pressure on the construction process but "we are expecting the development margin to be there or thereabouts what we are delivering."

The shares were trading down 1.3 per cent at $5.22 but have gained 19 per cent over the past year.

[JeremyALD]

From the Herald

Summerset grapple with wage increase

By Rebecca Howard

5:02 PM Thursday Apr 27, 2017

Summerset Group's board came under pressure regarding its plans for wage-earners who won't benefit from a recent government-funded lift in caregiver wages at its annual meeting in Wellington, but said it plans to be proactive.

Earlier this month the government announced it would implement a historic pay equity pay deal for aged and residential care workers worth $2.05 billion of extra pay over four years for some 55,000 people - close to 2 per cent of the total New Zealand workforce.

Summerset chief executive Julian Cook said "we are very pleased that a settlement has been reached and that wages for caregivers and the funding to match this will come into place shortly." However, several shareholders questioned what the company was going to do about the workers who won't benefit from the deal as well as the potential flow-on effect with other workers, such as nursing staff given the reduced pay gap.


Directors Grainne Troute and Andrew Wong - both elected Thursday - were asked what they were going to do to ensure that the benefits of the equal pay settlement extended to other staff.

Troute underscored it as a challenge the board "will be grappling with" and the need to be able to attract the best quality of staff applies to all areas of the business while Wong said that people will be looking at what they earn and what it means for the jobs they do and "we will have to respond to that if we want to get the best people to do the jobs we are asking them to do."

Chairman Rob Campbell, also re-elected Thursday, stressed that the board hasn't seen the detail of the settlement and said that "some of these matters are matters for negotiation." He recognised there "will be flow-ons but exactly what those flow-ons will be I don't think anyone on the board is really in a position to say at this stage."

Cambell emphasised the company will be proactive and said "we don't see the future of this business as being dependent on low wages or exploitation. We want to have a business that is based on paying people fairly and equitably and we will do that," he said.

Academic Paul Moon initiaded last week's open letter about threats to free speech in New Zealand universities. Photo / Richard Robinson
Political Roundup: Freedom of speech vs PC culture
North Korea has a massive US army on its border performing war manoeuvres. Photo / AP
Your Views: Readers' letters
The gender pay gap could be closed in the next five years, Diversity Works CEO Bev Cassidy-Mackenzie says.
How to close the gender pay gap
In the year to December 31, Summerset's employee expenses totalled $40.5 million and made up more than half of its $71.1m in operating expenses.

Across town in a pre-Budget speech the Wellington Chamber of Commerce, Finance Minister Steven Joyce today downplayed the potential ripple effect of the government's move into other sectors. "The barrier is rightly set high because a flow-on to other sectors would mean going back to the old relativities that these workers have just won the right to get away from."

According to Joyce, "if you have a number of employers and you have people being competed for with different employers you tend to find a rate which is effectively a market hourly rate rather than something that's a bit artificial" where there's a central funding body such as the government in the case of the caregiver settlement.

Looking ahead, Summerset did not offer any new guidance at the annual meeting but did warn that it was beginning to see some impact from capacity constraints in the construction market.

"Auckland based developments are currently being delivered in a construction market which is feeling much strain," said chief executive Julian Cook. The company is insulated to some degree as it acts as the main contractor on site, but "we are not immune from these pressures completely. We have seen one-to-two month delays on some projects and have also seen cost pressures coming through," said Cook. Contractor availability is also an issue given the high workload in the market.

It remains on track for a retirement unit build of around 450 units this year, however, "shareholders should be aware that these issues exist," he said.

In calendar 2016, Summerset improved its development margin to 22.2 per cent from 20 per cent benefiting from internal management and design of its construction sites, and its larger scale. Today, Cook said there was clearly more pressure on the construction process but "we are expecting the development margin to be there or thereabouts what we are delivering."

The shares were trading down 1.3 per cent at $5.22 but have gained 19 per cent over the past year.

I think that is a negatively slanted article based on what I've heard. I like their approach that they'll be proactive and pay for top talent, what more can they say on the matter? The SP went up over 2% yesterday so it hasn't really 'fallen' as a result of the meeting.

[Xerof]

Journalists are sad b'stards aren't they?

[kiwico]

Journalists are sad b'stards aren't they?

The focus on the cleaners [Directors Grainne Troute and Andrew Wong - both elected Thursday - were asked what they were going to do to ensure that the benefits of the equal pay settlement extended to other staff.] was weird.

Clearly the man asking the questions had a union background with the questions being asked when Grainne Troute was being put forward for director. This was a little ironic as 99% of proxies held by the Chairman were for Grainne.

It is recognised that the caregivers are underpaid but it appeared that this increase would be fully funded by the Government. When Grainne first answered the question about other workers such as cleaners an older woman piped up stating the question had not been answered and so round two started.

On the other hand, if the cleaners have not increased productivity should a pay increase in excess of inflation be available?

This comes across as a journo trying to find a none story.

[kiwico]

Incidentally the increase in total directors fees from $600k (effective from 2014) to $650k was also questioned despite it being made clear this was for potential additional costs (such as paying a director the agreed chair fee of $7,500 for chairing a new committee) rather than an increase in the amount paid to any director for the role(s) they are currently undertaking.

Not agreeing it at the AGM would have meant the board would have to contact shareholders at a later date if there was a new committee etc (and so an additional $7,500 required to pay the chair of sch new committee).

[kiwico]

On the question of whether AGMs should still be in person, which was touched on briefly by the chair (but in passing rather than expressing a preference), listening to a number of well-paid individuals reading out prepared statements does not appear to require an AGM to be in person. But it is always good to see the board (and meet them if you don't need to head back to work as I did) as well as to put questions to them in person.

We just need to stop cleaners becoming the focus.... (other than perhaps for Spotless and the like)

[percy]

"Auckland based developments are currently being delivered in a construction market which is feeling the strain."
I would point out there is no longer any strain in the Christchurch construction market.