Summerset Group Holdings Limited · NZX:SUM
Summerset — FY2021 Earnings Presentation
64 slides from Summerset's earnings presentation, 2022
Slide 1: Full year results presentation
Full year results presentation Full Year Report 2021
Slide 2: Agenda
Full Year Report 2021 Full year results presentation Agenda 01 COVID-19 update 02 Our highlights 03 Our community 2 04 New Zealand development 05 Australia development 06 Financial performance 07 Business performance 08 Appendix
Slide 3: COVID-19 update
COVID-19 update Full Year Report 2021 3 Bringing Daffodil Day to residents in Avonhead during lockdown
Slide 4: COVID-19 update
Full Year Report 2021 Our community COVID-19 update Protection of staff and residents remains our focus ▪ Summerset’s pandemic plan remains activated and we continue to be vigilant and well prepared in our response to COVID-19 and Omicron ▪ We are well positioned to manage through the pandemic, $4.7
Slide 5: Our highlights
Our highlights Full Year Report 2021 5 Summerset by the Dunes, Pāpāmoa Beach
Slide 6: Record net profit after tax (IFRS) of $543.7m
Full Year Report 2021 Our highlights Record net profit after tax (IFRS) of $543.7m IFRS net profit after tax of $543.7m resulting in a 42% growth in company equity since FY20 $543.7m $383.4m $141.1m Net profit after tax Net operating cash flows Underlying profit FY20 $230.8m FY20 $266.8m FY20 $98.3m
Slide 7: Record net profit after tax (IFRS) of $543.7m
Full Year Report 2021 Our highlights Record net profit after tax (IFRS) of $543.7m Record NPAT driven by largest ever delivery programme and strong demand, unit pricing remains conservative IFRS NPAT Sales prices vs median house price $600m $1,400,000 $500m $400m $1,200,000 $300m $543.7m $200m $1,00
Slide 8: FY21 investor highlights
Full Year Report 2021 Our highlights FY21 investor highlights Our results at a glance Record net profit after tax (NZ IFRS) of $543.7m, up from $230.8m in FY20, an increase of 136% Underlying profit for FY21 of $141.1m, up 44% on FY20 Operating cash flows of $383.4m, up 44% from $266.8m in FY20 Gear
Slide 9: Acquisitions – four new sites announced
Full Year Report 2021 Our highlights Acquisitions – four new sites announced Craigieburn, Approximately 225 Rest home and Memory Oakleigh South, Approximately 84 Rest home and Memory 9 independent homes hospital-level care care centre independent homes hospital-level care care centre Melbourne Melbo
Slide 10: Looking back – FY21 milestones
Full Year Report 2021 Our highlights Looking back – FY21 milestones A showcase of key events from the past year Resident Maisie Lund receives vaccine Lower Hutt blessing 1 10 0 Summerset at Heritage Park, Ellerslie Tyler Grant Richmond Main Building opening Summerset St Johns January March May HR te
Slide 11: Looking back – FY21 milestones
Full Year Report 2021 Our highlights Looking back – FY21 milestones A showcase of key events from the past year Cranbourne North planning permit received Aged Advisor award 1 11 0 Avonhead Main Building opens Cambridge blessing Milldale resource consent received Country and smoking ceremony – Cranbo
Slide 12: Our community
Our community Full Year Report 2021 12
Slide 13: Our residents
Full Year Report 2021 Our community Our residents Bringing the best of life to residents every day ▪ Continue to introduce and roll out new initiatives with an enhanced focus on resident well being ▪ Our care centres achieved 98% resident satisfaction with 96% for our retirement village residents in
Slide 14: Our residents
Full Year Report 2021 Our community Our residents Bringing the best of life to residents every day ▪ Progressively enhanced our customer offering, including moving our food services in-house to improve consistency and develop clear service standards ▪ Developed a series of webinars on ‘Navigating ca
Slide 15: Our staff
Full Year Report 2021 Our community Our staff Our staff are key to our success and we are immensely proud of the work they do ▪ FY21 saw significant investment in staff development and training across the business ▪ Officially launched our three-year plan to progress diversity and inclusion at Summe
Slide 16: Our environment
Full Year Report 2021 Bringing the best of life Our environment Summerset’s sustainability targets Environmental performance and sustainability 2018 - 2022 2021 - 2026 2026 - 2032 ▪ Summerset has been measuring, managing, and reporting Short term target Medium term targets Long term targets on its c
Slide 17: Community support
Full Year Report 2021 Our community Community support Promoting and supporting our communities ▪ Summerset now assists over 150 local community clubs and groups – including bowls, golf, croquet, bridge and tennis clubs, Age Concern, the RSA and Lions ▪ Renewed our sponsorship of Bowls New Zealand fo
Slide 18: New Zealand development
New Zealand development Full Year Report 2021 18 Summerset Mt Denby, Whangārei
Slide 19: Development activity
Full Year Report 2021 Development New Zealand Development activity New Zealand summary ▪ Summerset was the largest listed retirement village builder in New Zealand in FY21, and one of New Zealand’s largest residential home builders ▪ Delivered a record 671 total units including 278 villas, two main
Slide 20: Village development photos (Whangārei, Hobsonville, Hamilton, Pāpāmoa)
Full Year Report 2021 Development New Zealand 20 Summerset Mount Denby (Whangārei) Summerset at Monterey Park (Hobsonville, Auckland) Summerset Rototuna (Hamilton) Summerset on the Dunes (Pāpāmoa Beach, Tauranga)
Slide 21: Village development photos (New Plymouth, Napier, Wellington)
Full Year Report 2021 Development New Zealand 21 Summerset at Pohutukawa Place (Bell Block, New Plymouth) Summerset Palms (Te Awa, Napier) Summerset on the Landing (Kenepuru, Wellington) Summerset Boulcott (Lower Hutt, Wellington)
Slide 22: Village development photos (Nelson, Christchurch, Selwyn)
Full Year Report 2021 Development New Zealand 22 Summerset Richmond Ranges (Nelson) Summerset on Cavendish (Casebrook, Christchurch) Summerset at Avonhead (Christchurch) Summerset Prebbleton (Selwyn District)
Slide 23: New Zealand development pipeline
Full Year Report 2021 Development New Zealand New Zealand development pipeline Diversified development pipeline with 21 sites in FY21, 81% of land bank now fully consented 23 * New sites purchased
Slide 24: Australia development
Australia development Full Year Report 2021 24 Blessing Ceremony, Cranbourne North
Slide 25: Development activity
Full Year Report 2021 Development Australia Summerset Craigieburn Development activity Australia summary Summerset Chirnside Park Summerset Oakleigh South ▪ Substantial progress made on our Australian land bank, acquiring three Melbourne sites in FY21 in Chirnside Summerset Cranbourne North Park, Cr
Slide 26: Australian village sites
Full Year Report 2021 Development Australia 26 Summerset Chirnside Park (Melbourne) Summerset Cranbourne North (Melbourne) Summerset Craigieburn (Melbourne) Summerset Torquay (Victoria)
Slide 27: Australia development pipeline
Full Year Report 2021 Development Australia Australia development pipeline Excellent progress made in growing our Australian land bank, three sites added in FY21 27 * New sites purchased
Slide 28: Financial performance
Financial performance Full Year Report 2021 28
Slide 29: Reported profit (IFRS)
Full Year Report 2021 Financial results Reported profit (IFRS) NZ$m FY21 FY20 Variance FY19 Total revenue 205.3 172.4 19% 153.9 ▪ Record IFRS NPAT of $543.7m, up from $230.8m Reversal of impairment on land & 3.4 - - - in FY20 buildings Fair value movement of investment 537.5 221.1 143% 165.3 ▪ Fair
Slide 30: Fair value movement
Full Year Report 2021 Financial results Fair value movement ▪ FY21 fair value movement of $537.5m, a record $537.5m $140.4m Fair value movement Increase from new across all prior year reporting periods units delivered ▪ Fair value movement has been driven by: ▪ Unit pricing ($320.9m): Reflecting the
Slide 31: Underlying profit
Financial results Full Year Report 2021 Financial results Underlying profit ▪ Underlying profit of $141.1m, a 12 month record and $141.1m 44% Underlying profit Increase on FY20 up 44% on FY20 ▪ Continue to achieve record performance in operating earnings across our core business functions; NZ$m FY21
Slide 32: Cash flows
Financial results Full Year Report 2021 Financial results Cash flows ▪ Net operating cash flows of $383.4m, up from $383.4m 44% Net operating cash flows Increase on FY20 $266.8m at FY20 ▪ Excluding the purchase of land, net operating cash flows exceeded net investing cash flows by $30.4m, NZ$m FY21
Slide 33: Balance sheet
Financial results Full Year Report 2021 Financial results Balance sheet ▪ Total assets of $4.9b, up 26% on FY20 driven by $4.9b $1.5b Total assets 26% Retained 49% portfolio growth and the underlying value in our existing villages earnings ▪ Investment property valuation of $4.6b, up 26% on NZ$m FY2
Slide 34: Net tangible assets and gearing
Business overview Full Year Report 2021 Financial results Net tangible assets Strong financial disciplines underpinning net tangible assets and gearing Net tangible assets and gearing* Summerset net tangible assets per share $16 50.0% $9 44.5% $8.36 45.0% $14 $8 40.0% $12 $7 35.0% 30.0% $6 $10 NTA p
Slide 35: Gearing ratio
Financial results Full Year Report 2021 Financial results Gearing ratio ▪ Net debt of $741.5m* as at 31 December 2021, up 27.8% 29.8% Gearing ratio Bank & bond LVR from $656.8* at FY20 ▪ Uplift in gross debt driven by increased build rate Net debt to underlying assets – FY21 across our developing vi
Slide 36: Funding
Financial results Full Year Report 2021 Financial results Funding ▪ Bank facility now approximately $1.2b, with existing $1.2b $375m Bank facility Retail bonds $375m of retail bonds ▪ Total facility (incl. bonds) has an average tenure of Refinanced funding maturity profile 3.8 years $600m ▪ Loan fac
Slide 37: Final dividend
Financial results Full Year Report 2021 Final dividend Final dividend Gross dividend payout per year Declared FY21 final dividend of 8.6 cents per share $45m ▪ The Board has declared an unimputed final dividend of 8.6 cents per $40m share, being 30% of underlying profit $35m $19.8m ▪ This brings tot
Slide 38: Business performance
Business performance Full Year Report 2021 38
Slide 39: Retirement unit delivery
Business overview Full Year Report 2021 Business performance Retirement unit delivery Record 12 month deliveries of 671 total units 545 Retirement units 671 Total units delivered delivered ▪ A total of 671 units delivered in the period across 12 Retirement units Care units Unit Total villages, compr
Slide 40: Development margin
Business overview Full Year Report 2021 Business performance Development margin Realised development margin of $78.5m, with 23% $78.5m a 23% development margin Development margin Realised margin 63% ▪ Realised development margin of $78.5m, a record Realised development margin full year result and up
Slide 41: New sales
Business overview Full Year Report 2021 Business performance New sales 540 new sales in the period, record gross 540 $340.3m proceeds of $340.3m New sales of Gross proceeds 39% Occupation Rights ▪ A full year record of 540 new sales of Occupation Rights New sales FY21 FY20 Variance FY19 ▪ This is a
Slide 42: New sales stock
Business overview Full Year Report 2021 Business performance New sales stock Stock levels remain stable relative to prior 262 5.2% periods Uncontracted Percentage of new sale stock uncontracted stock ▪ Uncontracted new sale stock of 262 units, up from 179 at FY20 but in line with FY19 New sales stoc
Slide 43: New sales performance
Full Year Report 2021 Business performance New sales performance New sale settlements and total unit delivery Annual new sales contracts 800 800 671 600 541 600 508 506 434 413 540 400 354 400 414 404 382 333 339 329 200 200 - - 43 FY15 FY16 FY17 FY18 FY19 FY20 FY21 Jan Feb Mar Apr May Jun Jul Aug S
Slide 44: Resales
Business overview Full Year Report 2021 Business performance Resales Realised gain of $59.9m, up 30%, embedded 438 $59.9m value now $1.4b Resales of Realised resale 30% Occupation Rights gain ▪ Total resales of 438 occupation rights in FY21, up from 381 in FY20 and 323 in FY19 Resales FY21 FY20 Vari
Slide 45: Embedded value
Business overview Full Year Report 2021 Business performance Embedded value Embedded value now $1.4b, up 54% $1.4b $967.3m Embedded value Embedded resale gain ▪ Total embedded value now $1.4b, having increased Embedded value from $883.6m at FY20, a 54% uplift ▪ Embedded value comprised of: $1,600m ▪
Slide 46: Resales stock
Full Year Report 2021 Business performance Resales stock Available resales stock remains at very low 80 1.6% levels Uncontracted Percentage of resale stock uncontracted stock ▪ Resales stock continues to be low with 118 retirement units under contract and 80 units Resales stock FY21 FY20 FY19 uncont
Slide 47: Resales performance
Full Year Report 2021 Business performance Resales performance Resales settlements Annual resales contracts 500 500 400 400 300 300 438 200 381 200 300 301 323 245 244 100 100 - 47 - FY15 FY16 FY17 FY18 FY19 FY20 FY21 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2021 2020 2019 Realised resale gai
Slide 48: Questions
Questions 48
Slide 49: Disclaimer
Full Year Report 2021 Disclaimer Disclaimer ▪ This presentation may contain projections or forward looking statements regarding a variety of items. Such forward looking statements are based upon current expectations and involve risks and uncertainties ▪ Actual results may differ materially from thos
Slide 50: Appendix
Appendix 01 Summerset overview 02 Portfolio and land bank 03 Historical trends 50 04 Fair value movement 05 Demographics 06 Summerset growth 07 Customer profile and occupancy
Slide 51: Summerset overview
Full Year Report 2021 Summerset overview Summerset overview Diversified portfolio throughout New Zealand Our people Our care Our portfolio 6,900+ 98% 4,930 Residents Care resident Retirement units satisfaction in portfolio 2,100+ 1,098 5,406 51 Staff members Care units in Retirement units portfolio
Slide 52: Portfolio as at 31 December 2021
Appendix Full Year Report 2021 Portfolio Portfolio as at 31 December 2021 6,028 total units including 4,930 retirement units and 1,098 care units Existing portfolio - as at 31 December 2021 Retirement units Care units Total units and Serviced Memory care Care Care care beds Village Villas Apartments
Slide 53: Portfolio as at 31 December 2021
Full Year Report 2021 Portfolio Portfolio as at 31 December 2021 6,028 total units including 4,930 retirement units and 1,098 care units Existing portfolio - as at 31 December 2021 Retirement units Care units Total units and Serviced Memory care Care Care care beds Village Villas Apartments apartmen
Slide 54: Future development – land bank
Appendix Full Year Report 2021 Land bank Future development Largest New Zealand land bank for a retirement village operator of 5,313 units and beds* Land bank – as at 31 December 2021 Retirement units Care units Serviced Memory care Care Care Total units and Village Villas Apartments apartments apar
Slide 55: Future development – land bank
Appendix Full Year Report 2021 Land bank Future development Largest New Zealand land bank for a retirement village operator of 5,313 units and beds* Land bank – as at 30 June 2021 Retirement units Care units Serviced Memory care Care Care Total units and Village Villas Apartments apartments apartmen
Slide 56: FY21 underlying profit reconciliation
Appendix Full Year Report 2021 Appendix FY21 underlying profit reconciliation Reconciliation of underlying profit to reported net profit after tax FY21 FY20 Variance FY19 Net profit before tax (IFRS) 543.6 221.7 145% 173.6 Net profit after tax (IFRS) 543.7 230.8 136% 175.3 Financial (NZ$m) Less reve
Slide 57: Historical trends
Full Year Report 2021 Appendix Historical trends Underlying profit 10 year CAGR of 33% FY11 Full Year Results 10 Year CAGR* FY21 FY20 FY19 FY18 FY17 NZX listed New sales of occupation rights 17% 540 404 329 339 382 108 Resales of occupation rights 14% 438 381 323 301 300 123 Operational Total sales
Slide 58: Fair value movement
Appendix Full Year Report 2021 Appendix Fair value movement Fair value movement of investment property – key assumptions Value of Fair value movement of Fair value investment Key valuation assumptions investment property gain/(loss) property* Discount Growth rate Growth rate Growth rate Growth rate
Slide 59: Fair value movement
Appendix Full Year Report 2021 Appendix Fair value movement Fair value movement of investment property – key assumptions Value of Fair value movement of Fair value investment Key valuation assumptions investment property gain/(loss) property* Discount Growth rate Growth rate Growth rate Growth rate
Slide 60: Care centre valuation
Appendix Full Year Report 2021 Appendix Care centre valuation Care centre valuation – key assumptions Value of care Total care beds Total care units Assumed Assumed value Value of care facilities facility (non ORA) (ORA) capitalisation rate per bed** (incl. ORA) Village Location No. No. NZ$m % NZ$'0
Slide 61: Demographics
Appendix Full Year Report 2021 Appendix Demographics Population over 75 years forecast to grow 231% from 2021 to 2073 Population growth 75 years and over Per annum population growth 75 years and over 1,200,000 18% 25,000 16% 1,000,000 20,000 14% 800,000 12% 61 15,000 10% 600,000 8% 10,000 400,000 6%
Slide 62: Summerset growth
Appendix Full Year Report 2021 Appendix Summerset growth 24 years of consistent delivery and growth Summerset build rate 7,000 6,028 6,000 5,357 671 4,944 413 5,000 4,590 354 62 4,084 506 4,000 Total units 3,576 508 3,035 541 3,000 2,601 434 5,357 2,297 304 4,944 1,973 4,590 1,813 324 4,084 2,000 1,
Slide 63: Customer profile & occupancy
Appendix Full Year Report 2021 Appendix Customer profile & occupancy Occupancy, tenure and resident demographic statistics Occupancy – retirement villages Occupancy – established care centres 100% 100% 80% 80% 60% 60% 96% 96% 96% 96% 96% 97% 40% 40% 63 20% 20% - - FY19 FY20 FY21 FY19 FY20 FY21 Avera
Slide 64: Ngā mihi
Ngā mihi 64 For more information: Will Wright Chief Financial Officer will.wright@summerset.co.nz 021 490 251
Summerset Group Holdings — FY2021 Earnings Presentation on 6ix