OCA - Oceania Group - retirement villages

[Daytr]

Amberwood, 499 Don Buck Rd Massey, West Auckland.
On site approximately 30 Rest Home units of the older style, and approximately 30 high need type or hospital rooms (single) build later maybe early 2000.

Amberwood has a road sign which used to note it was part of the OCA group, this part of the OCA group has been painted over so I assume it is not longer owned by OCA.

Seems that sold for $9.5Mln.
If we say a high needs suite is worth 15% of a unit, it values a unit including the land its on at $275k.

Selling off individual villages like this would likely generate more value than a buyer looking at taking over OCA.

A buyer of an individual small development will quite likely be looking at utility value. I.e charities, councils, Iwi etc looking to provide public housing.

Whereas a commercial valuation of OCA will have no such emotive value. It will purely come down to the PV of net future cashflow.

[Ferg]

Probably been ‘writing down’ the book value of these properties over the last few years …..been quite a lot of impairment $s and who knows the detail of the ‘independent’ valuation of each property

I’d say these 9 properties ‘valued’ as to what they hopefully thought they would get for them

AFAIK the accounts don't break out the valuation adjustments for this subset of properties prior to April 2022 but yes they would be valued to the expected realisable value once they are classified as being for sale. Prior to that they would be subject to the normal valuation process by the independent valuers. We can see the actual adjustments to this subset of properties since April 2022 as follows:

Per the annual (AR) and interim reports (IR) - all figures NZ$000s :

• Transfers from other assets categories = $98,824
• Add expenditure incurred +$942
• Add revaluation gain +$1,886
• = Reported value held for resale per AR 2023 p56 of $101,652

• Add expenditure incurred +$440
• Less Value of properties sold -$42,070
• Less revaluation loss -$1,258
• = Reported value held for resale per IR 2024 p47 of $58,764

The nett revaluation impact over the last reported 18 months was +$628k.

[Baa_Baa]

AFAIK the accounts don't break out the valuation adjustments for this subset of properties prior to April 2022 but yes they would be valued to the expected realisable value once they are classified as being for sale. Prior to that they would be subject to the normal valuation process by the independent valuers. We can see the actual adjustments to this subset of properties since April 2022 as follows:

Per the annual (AR) and interim reports (IR) - all figures NZ$000s :

• Transfers from other assets categories = $98,824
• Add expenditure incurred +$942
• Add revaluation gain +$1,886
• = Reported value held for resale per AR 2023 p56 of $101,652

• Add expenditure incurred +$440
• Less Value of properties sold -$42,070
• Less revaluation loss -$1,258
• = Reported value held for resale per IR 2024 p47 of $58,764

The nett revaluation impact over the last reported 18 months was +$628k.

Damn, you actually read the financials! Stop making sense. 😂

[allfromacell]

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.

[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.

What would that achieve for shareholders, selling the sliver (killing the golden goose) and buying back the stock?

[Habits]

Boosts asset backing per share. Same or higher total net assets (if sold for more than BV), and fewer issued shares

Selling top assets allows competitors in, in good locations against OCA

[winner69]

Boosts asset backing per share. Same or higher total net assets (if sold for more than BV), and fewer issued shares

Selling top assets allows competitors in, in good locations against OCA

The good old buyback trick eh …hoping better per share numbers will see market increase price of remaining shares. Hardly ever works out that way

Buybacks only make sense when there’s surplus cash and not much to do with it só a buyback is essentially returning that cash to some shareholders …….dont think Oceania is in that position eh

[Bjauck]

The good old buyback trick eh …hoping better per share numbers will see market increase price of remaining shares. Hardly ever works out that way

Buybacks only make sense when there’s surplus cash and not much to do with it só a buyback is essentially returning that cash to some shareholders …….dont think Oceania is in that position eh

I guess OCA could sell a village at above NTA value and then buyback its shares which are trading at below NTA?

[Balance]

Sobering to see that Ryman has been the worse performing RV stock since 2022 although all three non-performers, RYM, OCA & ARV, have cost shareholders very very dearly to be in them in the last 2 years+. Have left out SUM as it broke the down trend line in the last year.

Interesting to note that all three follow the overall same trend line (down, up and down) so the sp performance malaise appears to be an industry wide issue rather than just a specific stock.

Market woke up to just how cashflow hungry the three RV operators are and how they have been piling on debt to pay dividends as well as pay for ever more expensive land and developments. Too much focus on the so-called interest free 'float' and no focus on the quality & cost of assets bought and built up by the RV players.

[https://nz.finance.yahoo.com/chart/R...RkaW5nIjowfX0-

[Daytr]

I guess OCA could sell a village at above NTA value and then buyback its shares which are trading at below NTA?

Or just stick to their knitting.
The biggest issue they face is they run operationally at a loss.
This is why I don't buy into the NTA, where do you value a loss making asset?