RYM - Ryman Healthcare

[couta1]

I see this as a bit of a consolidation year but if they make the 15% then that's pretty good for such a year, next year when a couple of big 440 bed villages like Petone come into full play then she's onward and upward aye

[Vaygor1]

Just watched the webcast. I don't see a major slowdown in anything (refer graph)… and especially in build-rate too. 450 units in the 1st half alone….that's 2.5 units per day.

Their Underlying Profit down to 13% for H1 due to some major payments for their land-banking from what I can gather from the presentation this morning. One more big payment for their new Melbourne College site due in May 2015…. well after the end of the 31-March full year result.

Attachment 6493

Will be interesting to see how the market reacts today and over the next 3-4 weeks. Might head south if the Underlying Profit results drive the insto's... or head north if EPS is the flavour of the month. Either way the above is a beautiful chart that any company would be proud to brandish.

[Beagle]

Underlying profit up 22% last year at the half year, 16% in 2012, 15% in 2011. Sorry but 13% is underwhelming.

[Vaygor1]

Underlying profit up 22% last year at the half year, 16% in 2012, 15% in 2011. Sorry but 13% is underwhelming.

Yes, less than I expected but will look into the detail to verify the reasons they alluded to in the webcast. They confirmed twice they are on track to beat the 15% target for the full year and based on strong resale volumes, demand, good pricing, and other measures stated this morning, I think they will achieve it easily.

In the meantime market sentiment will do its own thing and there could be good opportunities to buy during this H2, and again after the H1 announcement next year during which they pay off the Melbourne College site... I was kind of right about my hunch in May on deferred payment for the site:
http://www.sharetrader.co.nz/showthr...l=1#post483565 although 1 year isn't exactly long term it's better than nothing and certainly helps with cash-flow planning.

RYM appear to have planned large settlements to their big debtors in H1 each year so as to finish with a good H2 recovery and a full-year result that meets and betters expectations.

In terms of RYM shareholder's equity, that's looking pretty awesome too:

Attachment 6495

[percy]

A very pleasing result.
Good to read Australia is exceeding expectations.
Shareholders will be looking forward to "phenomenal growth."

[macduffy]

Underlying profit up 22% last year at the half year, 16% in 2012, 15% in 2011. Sorry but 13% is underwhelming.

Yes, it gets harder and harder to better past increases as the numbers grow!

I'm happy with the result.

[winner69]

Ryman doesn't seem the people not dying to plan problem that Summerset has.

But they do seem to have the same issue with ballooning expenses.

[Beagle]

And it'll only get worse as pressure grows for people to be paid the minimum liveable wage.

[percy]

And it'll only get worse as pressure grows for people to be paid the minimum liveable wage.

Looks as though Ryman are making a very strong commitment to staff going from The Chairman's comments in the half year result;
"We are working hard to develop the staff and systems we will need."
"with extra resources going into staff training and systems."

[Beagle]

With the greatest respect mate its not about staff training and systems. If you're paying people $16 an hour who work really hard and they need circa $18.30 an hour, (the recognised minimum liveable wage) to live with a modicum of some level of dignity. RYM make money by paying a substantial percentage of their staff at a rate where those staff have to live in poverty. Sorry if this unpalatable fact makes shareholders feel slightly uncomfortable. If they paid people properly they wouldn't have to spend so much on staff training as staff churn would be much lower. As the unquestionable market leader in this sector they definitely have a role to play and this role will place further pressure on costs.

The other aspect of this latest result that hasn't gone unnoticed, is yet again we have a low quality result in that there's basically an inconsequential amount of tax being paid. How long can this corporate get away with escaping its tax obligations remains to be seen but surely this can't go on forever ? So it pays next to NO tax and pays its staff to live in poverty. Good corporate citizen ? Hmmmm
The standard of care I saw for my Dad in his last few months in one of Ryman's secure dementia facilities was also highly questionable...The old saying of "if you pay peanuts you get monkeys" springs very readily to mind. Ryman's profit increases continue, (albeit at a slower rate) but at what price to staff and its most vulnerable and needy ?