OCA - Oceania Group - retirement villages

[sb9]

And as just pointed out to me, the Auckland property mkt is going backwards atm so that along with the wage increase as an unfortunate timing for an IPO is an understatement indeed.

Yes, I think the whole retirement has just been shaken around firstly by the wage agreement and supposed impact of property price slowdown (more so in Akl).

Think it'll take a while for the market to digest this all and rerate the sector.

[percy]

And in the meantime Nana needs to go into care.
Have not been able to stop her growing older.
She is not alone.
Luckily the sale of her property means she could buy two or three units.She will only require one.

[couta1]

And in the meantime Nana needs to go into care.
Have not been able to stop her growing older.
She is not alone.
Luckily the sale of her property means she could buy two or three units.She will only require one.

Nice one Percy, even after an abysmal week for the retirement sector stocks, which is most annoying and inconvenient, buyers will still be lining up at an ever increasing rate. Once the market stops throwing it's toys out of the cot, it will realise, it's just business as usual.

[Yoda]

A mere 50c increase in wages across the board costs the company around 2million, so think of the extra wage costs when you give all your nurses a $3 -$5 per hour increase, then all your activities staff an extra $3 an hour etc etc. It's quite conceivable that your could be talking an extra 10 million in wage costs.

That would be an awesome pay rise ...Most nurses would be on 50-60k a year so that way over 10% pay rise . My last pay rise was about 2.5 % over 3 years

[winner69]

someone will have to foot the bill and it would be ridiculous to think the shareholders should pay for it. I am all for everyone's wages increasing,but it always comes at a cost to either the customer or the government (The government is us as a nation). You would know where they would get the money from more than I would couta. I appreciate your input on this ��

Selfish view - some might say profits are already excessive and shareholders should pay be reduced margins

[sb9]

Not a flash debut, wasn't it.

Closed flat, stags out of luck on listing, will be interesting to see what coming weeks have in offer.

[Ggcc]

Selfish view - some might say profits are already excessive and shareholders should pay be reduced margins

If you have ever been self employed you would understand this comment. It is not meant to be a "selfish" view. A business model is simple. Your cost go up, pass it on.

[Baa_Baa]

Not a flash debut, wasn't it.

Closed flat, stags out of luck on listing, will be interesting to see what coming weeks have in offer.

I think they did very well not to be caught immediately in the current sector down draught that would be top of mind for the promoters.

Stags would be few imo if they had considered that. In an up trending sector, sure, the stags would be all over this. I'm not sure many were though, it was too risky with the sector backdrop to stag an IPO profit.

The market today verified its listing price as fair and reasonable, and the promoters will earn their commission regardless.

On Monday the company is listed alongside the others. From here on the market determines the company value.

My view is that in the short term at least, they will suffer the downdraft associated with the sector, the SP will move with it and the investors who have done their homework will flick out on a slightest move southwards and buy back in later.

Personally I think it's at fair value on the information provided but as some suggest that information may be overly optimistic. Seems a risky play until it settles in to a rhythm.

[couta1]

For those interested, 73% of Oceania's total product is in care beds currently, however they have a 7-8 years worth of land bank, so plenty of scope for unit expansion.

[Joshuatree]

from the prospectus

"approximately 30.4% of Oceania’s Pro forma Underlying EBITDA (pre corporate / other costs)is derived from the sale and re-sale of Units in FY2017F, increasing to approximately 43.8% inFY2018F "

Worth repeating