OCA - Oceania Group - retirement villages

[Daytr]

It is getting to the stage where, in the absence of takeover offers, it seems breaking up the company, selling individual villages and ceasing to operate loss making beds may be the best way forward for shareholders. It seems unlikely that government will make running standard rest homes particularly profitable any time soon. The outlook for long term residential real estate prices is quite sober compared with the past. If OCA can get remotely close to current NTA values, that is still quite a margin above current SP. Perhaps it is time to get a break up valuation for OCA.

There should be no desperation.
The current real estate market isn't a market to start selling off assets.
The real estate market will turn. Timing is everything.
Meanwhile as I keep saying, they just need to operationally make a profit, even a small profit so sales & resales isn't subsidizing the day to day business.

Once the real estate market turns, which it will, those development lots,.sales & resales should start generating serious cash.

[thegreatestben]

Unsure if it’s because they have no choice or whether they’ve seen the signs they need, but a lot of the developments that had been on ice for a year or two have kicked off again around Lower Hutt.

Wouldn’t want to be empty handed if interest rates come down or perhaps there’s a generalised support for fhb’s that will replace schemes like Kiwibuild and first home partner (shared ownership).

Or as some prefer to say, perpetuate the ponzi.

[Baa_Baa]

So if some of OCAs least desirable property is selling at book value or even a premium... Time to consider selling some more prime locations and buying back the stock.

This is what you said first, emphasis on selling the golden geese. But that would kill the value proposition and the strategy shareholders bought in to.

If the market is valuing the business at under half NTA and it's possible to sell the assets at book value, maybe it's not so silly to actually start selling bits off.

Then you downgraded to exactly what they are doing. Refer recent announcement of progress (the strategy announced many months ago) downscaling, selling, underperforming and non-strategically aligned properties.

But selling the golden geese, just to buy back shares? Yeah nah, aint going to happen. Neither is selling off the "bits" about buying back shares, the purpose is to shore up the balance sheet.

[Balance]

I think you have all forgotten Lyall Taylor's wisdom on why you will never get NTA value out of OCA, bar some freakish circumstances (like those 0% interest rate days). Mind you it was 179 pages back!




SNOOPY

Makes a lot of sense and as an aside, I dealt and interacted with Lyall Taylor when he was working as an analyst in NZ before he headed overseas. What I liked about his research was that he wasn't afraid to stick his neck out (compared to almost 95% of the other analysts out there) and the piece by him above showed that he has maintained his independence. Writing as he did about HKL takes guts as HKL is a big player in the corporate world. HKL's sp today is where it was in 2009!

[winner69]

Makes a lot of sense and as an aside, I dealt and interacted with Lyall Taylor when he was working as an analyst in NZ before he headed overseas. What I liked about his research was that he wasn't afraid to stick his neck out (compared to almost 95% of the other analysts out there) and the piece by him above showed that he has maintained his independence. Writing as he did about HKL takes guts as HKL is a big player in the corporate world. HKL's sp today is where it was in 2009!

Lyall learnt participating on Sharetrader as a youngster …..always prepared to listen and learn

[Bjauck]

Maybe no desperation. However the previous generation’s house price increase in excess of either inflation or wage increases seems unlikely to continue. Female labour force participation rates have probably no further room to grow.

So short of multiple family households it seems unlikely that the multiple of average income to buy an average house has as much growth potential as previously, unless houses become even more comparatively attractive to wealthier investors, versus alternatives such as shares or pension plans.

I still think break up valuations need to be provided so that shareholders should consider sale of villages and rest homes as an alternative way to maximise value as opposed to continued operations, with current share values.

[winner69]

Next results announcement only weeks away.

Time to review performance since listing ……these are the headlines over the years:



July 17. Oceania Healthcare exceeds IPO forecasts
Jan 18. Oceania Healthcare doubles profit for half year
July 18. Oceania Healthcare exceeds forecast with strong earnings boost
Jan 19. Oceania Healthcare grows profit for the six months ended 30 November 2018
July 19. Oceania Healthcare reports completion of key development projects and strong sales momentum
Jan 20. Substantial Increase in First Half Unaudited Underlying NPAT* for Oceania Healthcare.
July 20. Oceania Healthcare reports steady underlying earnings for the year despite impacts of COVID-19
Jan 21. Oceania records increase in First Half Unaudited Underlying EBITDA
May 21 Oceania records strong 10 month trading result
Nov 21 Oceania delivers improved performance despite Covid 19
May 22 Oceania positioned for growth
Nov 22. Care Suite premiumisation deliver results
May 23 Oceania delivers solid result
Nov 23 Oceania continues the transformation of its portfolio

Recent headlines seem to be getting less bullish than previous ones


Wonder what the May 24 headline will be?

[Ggcc]

Next results announcement only weeks away.

Time to review performance since listing ……these are the headlines over the years:
OCA exceeds results and is continuing with its transformational goals.





July 17. Oceania Healthcare exceeds IPO forecasts
Jan 18. Oceania Healthcare doubles profit for half year
July 18. Oceania Healthcare exceeds forecast with strong earnings boost
Jan 19. Oceania Healthcare grows profit for the six months ended 30 November 2018
July 19. Oceania Healthcare reports completion of key development projects and strong sales momentum
Jan 20. Substantial Increase in First Half Unaudited Underlying NPAT* for Oceania Healthcare.
July 20. Oceania Healthcare reports steady underlying earnings for the year despite impacts of COVID-19
Jan 21. Oceania records increase in First Half Unaudited Underlying EBITDA
May 21 Oceania records strong 10 month trading result
Nov 21 Oceania delivers improved performance despite Covid 19
May 22 Oceania positioned for growth
Nov 22. Care Suite premiumisation deliver results
May 23 Oceania delivers solid result
Nov 23 Oceania continues the transformation of its portfolio




Wonder what the May 24 headline will be?

OCA exceeds results and is continuing with its transformational goals.
Late 2024 or early 2025. We will capital raise to continue with this magnificent opportunity. I feel early next year maybe the year to go down hard on this. depends on if they get their stuff sorted.

[winner69]

OCA exceeds results and is continuing with its transformational goals.
Late 2024 or early 2025. We will capital raise to continue with this magnificent opportunity. I feel early next year maybe the year to go down hard on this. depends on if they get their stuff sorted.

So the headline won’t be like this March 21 then -

Oceania announces $100m equity raising to fund acquisitions

[Bjauck]

Next results announcement only weeks away.

Time to review performance since listing ……these are the headlines over the years:



July 17. Oceania Healthcare exceeds IPO forecasts
Jan 18. Oceania Healthcare doubles profit for half year
July 18. Oceania Healthcare exceeds forecast with strong earnings boost
Jan 19. Oceania Healthcare grows profit for the six months ended 30 November 2018
July 19. Oceania Healthcare reports completion of key development projects and strong sales momentum
Jan 20. Substantial Increase in First Half Unaudited Underlying NPAT* for Oceania Healthcare.
July 20. Oceania Healthcare reports steady underlying earnings for the year despite impacts of COVID-19
Jan 21. Oceania records increase in First Half Unaudited Underlying EBITDA
May 21 Oceania records strong 10 month trading result
Nov 21 Oceania delivers improved performance despite Covid 19
May 22 Oceania positioned for growth
Nov 22. Care Suite premiumisation deliver results
May 23 Oceania delivers solid result
Nov 23 Oceania continues the transformation of its portfolio

Recent headlines seem to be getting less bullish than previous ones


Wonder what the May 24 headline will be?

Good list! Still, reading those headlines one would expect a “solidly” increasing SP.

So compiling a headline glossary:
Positioned for growth = currently underperforming
Premiumisation = We want to become Summerset
Solid result = constipated, we are straining for little reward
Transformation = everything else has failed