RYM - Ryman Healthcare

[Arbroath]

I'd say its a statement of the obvious - they have several large developements coming through in FY18 but will book most of the development earnings in the second half.....so maybe first half profit only up c. 5% but the second half delivers a strong gain to get the year overall into double digits??

FY19/20/21 should be good years as large developements come through but there is always risk of course that things don't go to plan. I'm holding long-term.

Headline sounds like veiled profit warning

. RYMAN HEALTHCARE SAYS DEMAND STRONG BUT 1H GROWTH LIKELY LIMITED





http://www.sharechat.co.nz/article/0...ly-limitedhtml

[Beagle]

Trading is in line with expectations but "development earnings would be heavily weighted towards the back end of the second half in line with the timing of the construction programme at Ryman's developing villages

Something to watch. If there's any timing issues with practical completion of those units we could see some slippage of planned completion into FY19.
Some risk to assumed 15% growth in underlying earnings for FY18 in my opinion. Market forgave them only achieving 13% underlying earnings growth in FY17, maybe not so happy if there's a repeat especially if its single digit this time ? Huge PE premium to the rest of the sector, still fully priced in my opinion after SP ostensibly just range trading for 3 1/2 years. Simon Challis timing of his stake sale looked impeccable to me.

[percy]

Would some kind person please post the link to Stuff article [which can also be found by Googling the heading];
"Ryman prepares for grey Tsunami".

[Joshuatree]

Very well written Snoopy. You will get little traction on here as its almost a taboo subject; with investment bias editing out the "property development company" risk aspects of Ryman ,SUM etc etc.

[Jay]

here you go percy
http://www.stuff.co.nz/business/indu...e-grey-tsunami

[percy]

here you go percy
http://www.stuff.co.nz/business/indu...e-grey-tsunami

Thank you but that is not the article.
Google.; Ryman prepares for grey Tsunami.

[Harley]

Thank you but that is not the article.
Google.; Ryman prepares for grey Tsunami.

http://www.pressreader.com/new-zeala...81784219163548

[percy]

http://www.pressreader.com/new-zeala...81784219163548

Thank you.
Gordon MacLeod:
"Ryman had been UNAFFECTED by previous downturns in the property market."
He reiterated "it's got to be good for Mum" values he pledged to uphold.
Melbourne based director George Savvides comments are well worth taking onboard.

[Bjauck]

Most of the capital gains from increases in unit valuations flow into the balance sheet and are tax free. That won't continue in Australia for a start because AFAIK only the family home is capital gains tax exempt there. Thus over the last ten years Ryman has had a massive tailwind of 'free' capital with which to leverage their original modest capital base. Pricing Ryman on historical multiples carries an implication that this source of funding will continue. It might, if those millions of millionaires in China and India are allowed to invest offshore by buying into the Auckland property market. But at some point, I think this will become politically unacceptable for NZ voters (we may be at that point already). So non residents must end up being banned from buying houses. When that happens can domestic buyers take up the slack? The answer to that question, with housing affordability at an all time low and rising interest rates on the horizon, is no. So it is clear that the constantly inflating property portion of the Ryman balance sheet will grind to a halt under this scenario. At best lower property leverage means lower growth. At worst?

A favourable tax ruling ocertainly helped the likes of RYM and I guess it stimulated the construction of ORA units. Without that ruling I guess it could be argued that there would have been less incentive for RYM et al. to build units - resulting in fewer new dwellings constructed and an even greater housing shortage (especially in Auckland.) Also the government may have had to have alternative provisioning for aged care.

As with everything, there is a risk that that the regulatory environment could change. I don't think it would be in the interests of any government to scare aware existing or future investors in the supply of retirement accommodation and long term care.

[percy]

It is very doubtful the retirement sector companies can meet the demand, of the aging Tsunami .
Alter the rules,and what will happen.? The companies in the sector will stop development.
The Government and Fletchers will step up to the plate.Yeah right.?