OCA - Oceania Group - retirement villages

[Daytr]

Remember, this is a business in transition.

Since FY23 it has ceased to operate 5 resthomes, and has 7 more for sale ( one was under contract by 30 Sept). Already it has lost 255 care beds in just six months with likely at least that many more on the block currently. So revenue will fall, along with staff costs and other operating overhead, and the underlying asset base will be adjusted (albeit the two leasehold facilities were the first to be exited, and one other facility was simply closed without the land and buildings being onsold at that juncture). This swing away from care beds to village units has been ongoing since listing but is definitely accelerating now that underlying circumstances are more permissive.

So if that pivot continues, as it surely will, then spreadsheet comparison isn't easy, further compounded by the acquisitions of operating facitities with development potential.

It will take time for this business to reach a more stable operating base and the fog to lift.

Thats a good question you have raised there that others maybe able to answer.

If the future cashflow of the DMF is so good which it should be why would they be selling off villages in a market that doesn't recognize that value?

Thoughts?

[winner69]

Jeez Ron …..I worry about you when you use words like transition, pivot and even stable

Did you leave out your thoughts about how they can keep entropy from happening?

Or is it really a matter of how conveniently they can reinvent holistic convergence?

[Rawz]

Once they are past the point of inflection this will rocket

[bull....]

Thats a good question you have raised there that others maybe able to answer.

If the future cashflow of the DMF is so good which it should be why would they be selling off villages in a market that doesn't recognize that value?

Thoughts?

the irr not good enough if you take this is relation to the cost of capital and its leading to uneven cashflows thats why. basically sh.t investments they have made. thats how insurance companies go bust they invest there float in sh.t investemnts or dont manage the risk correctly. thats why buffett is far surperior to all as his underwriters are the best of the best.

[ronaldson]

Thats a good question you have raised there that others maybe able to answer.

If the future cashflow of the DMF is so good which it should be why would they be selling off villages in a market that doesn't recognize that value?

Thoughts?

Because rest home beds do not generate any DMF.

[Daytr]

Because rest home beds do not generate any DMF.

Sorry I thought I read above that they were selling entire villages, I.e units as well.
I understand re the care units.

[winner69]

Once they are past the point of inflection this will rocket

They said they point of inflection was a few years ago

[Greekwatchdog]

They said they point of inflection was a few years ago

Then we had Covid. Go figure

[SailorRob]

the irr not good enough if you take this is relation to the cost of capital and its leading to uneven cashflows thats why. basically sh.t investments they have made. thats how insurance companies go bust they invest there float in sh.t investemnts or dont manage the risk correctly. thats why buffett is far surperior to all as his underwriters are the best of the best.

I never knew underwriters invested float, cheers for this.

[bull....]

I never knew underwriters invested float, cheers for this.

funny. without them there would be no float for buffettt to invest. anyway time for bed big fed day coming up