OCA - Oceania Group - retirement villages

[trader_jackson]

As well as wage costs, govt regulation change is highly relevant for care bed facilities only need to look at what happened in australia to the care bed companies listed on the ASX when the govt changed the rules.

Anyway all these are well highlighted in the risks set out in the ipo document.

Re your point on ASX companies (and their recent downfall) as well as a few other interesting things
http://www.afr.com/business/banking-...0170331-gvay28

Good article, might be behind a paywall but just don't allow it to fully load on chrome and you should be able to see it

[bull....]

Re your point on ASX companies (and their recent downfall) as well as a few other interesting things
http://www.afr.com/business/banking-...0170331-gvay28

Good article, might be behind a paywall but just don't allow it to fully load on chrome and you should be able to see it

interesting but just someone sounding as positive as they can, no-one can guarantee the nz govt wouldn't do the same as in aus in the future it remains a highly relevant risk for all in the sector.

In aus the govt decided that aged care facilities must change the way
capital refurbishment fees' and 'asset replacement contributions'. are made

[bull....]

TJ here some ratios I look at (you probably use some im assuming)

Ocupancy Rate
Revenue/bed day
ebitda/bed day
staff costs as a % total expenses
staff costs as a % total revenue
depreciation expense/bed day
resident pay profile

just a few to look at you could even compare them to say the aged care providers in Australia eg EHE,JHC,REG
to get an idea how efficiently they are running things compared to others.

[kiora]

Re your point on ASX companies (and their recent downfall) as well as a few other interesting things
http://www.afr.com/business/banking-...0170331-gvay28

Good article, might be behind a paywall but just don't allow it to fully load on chrome and you should be able to see it

Good article, might be behind a paywall but just don't allow it to fully load on chrome and you should be able to see it
How do you do this again?

[Hectorplains]

Good article, might be behind a paywall but just don't allow it to fully load on chrome and you should be able to see it
How do you do this again?

Easiest way is to google the headline. Open the cached version- choose 'text only.'

Anyway have PM'ed it for you.

[Joshuatree]

Cant bring it up on my iMac other than quick headline "tarred with the same brush"

[Joshuatree]

Ive heard a whisper re Oceania set at 84c but no confirmation. How believeable is profits DOUBLING in 2018 year and has the 50c an hour increase for min wage been factored in??

Heres an excerpt

Oceania Healthcare says it won't be tarred with the same brush as Australian counterparts because the NZ funding model ... Oceania Healthcare says it won't be tarred with the same brush as Australian counterparts because the NZ funding model ... Oceania Healthcare says it won't be tarred with the same brush as Australian counterparts because the NZ funding model is different. Naphat Jorjee
The chief executive of aged care firm Oceania Healthcare, which is preparing to list on both the New Zealand and Australian stock exchanges, says the Kiwi company will be spared from the negativity surrounding Australian counterparts because funding models are totally different.
Earl Gasparich said he did not expect any backwash from the poor sentiment towards the Australian listed players, which have been hurt by government funding cuts and uncertainty.
"The regulatory environment is very much an opportunity on the upside, not on the downside," Mr Gasparich said, referring to the much better prospects in New Zealand.
"It's a different funding model."

Oceania, which is New Zealand's third largest residential aged care provider and the sixth biggest operator of retirement villages, is preparing to raise up to $NZ273 million ($250 million) in a public offering, with an indicative price range of between $NZ0.76 and $NZ1.04. It will undertake a dual listing on both sides of the Tasman.

"It offers a nice level of diversity for Australian investors," he said. Mr Gasparich is headed to Australia on Monday ahead of roadshows to fund managers in Sydney and Melbourne as the float plans step up a gear. A prospectus was lodged on March 31.
The main listed aged care operators in Australia have come under substantial pressure because of government funding cuts, with Estia Health one of the hardest hit. (http://www.afr.com/street-talk/kerry...0170111-gtpux1) It downgraded profits twice in 2016 and embarked on a highly dilutive capital raising. Estia shares were trading at $5.50 in late May 2016 and are now hovering just above $3.
Japara Healthcare shares have dropped from about $3 a year ago to just above $2, while Regis Healthcare (http://www.afr.com/real-estate/estia...206-gt5klj)has slipped from $5 to just below $4.50 in the past 12 months.
*'We've got sufficient land'*

Mr Gasparich said Oceania didn't have any medium-term plans to enter the Australian market, because it had a large pipeline of work as it expands its facilities at home.
"We've got sufficient land to keep us busy for eight years," he said. The long-term demographics in New Zealand are similar to those in Australia, with demand for beds climbing. Across the industry in New Zealand, an extra 1170 to 1340 extra beds will be needed each year until 2026.
"The pent-up demand is there," Mr Gasparich said.
Oceania's facilities are in six main locations in New Zealand – Auckland, Tauranga, Hawke's Bay and Wellington on the North Island and Nelson and Christchurch on the South Island. The company provides accommodation for about 4000 residents across 48 facilities.

Oceania forecasts in its prospectus that revenues for the 12 months ending May 31, 2017 will reach $NZ210.9 million, rising to $NZ215.7 million in the following year. Net profit after tax is expected to be $NZ25.3 million in 2016-17, climbing to $NZ53.1 million in the 12 months ended May 31, 2018.
The existing owner, funds run by Macquarie Infrastructure and Real Assets, has agreed not to sell any of its holdings under escrow arrangements which run until July 2018. Oceania aims to start trading on the Australian and New Zealand stock exchanges on May 5.
Mr Gasparich said the company was clearly explaining to potential investors that the chances of any regulatory changes happening in New Zealand that would be detrimental to Oceania was very slim. But he acknowledged that confidence in the investment community had been rocked in Australia after government funding cuts which had undermined share prices in the main listed players on the ASX.
"There's no doubt that a number of them have been hurt by the funding cuts," he said.

[couta1]

I wonder what will happen to the share price once Macquarie and Real Assets are able to sell their shares after July 2018, if forecasts are not going as expected.

[Joshuatree]

Also is that doubling of NPAT feasible?

[couta1]

Also is that doubling of NPAT feasible?

Sounds very bullish, however they did double their gross profit last year compared to the year before.