Ryman Healthcare Ltd. · NZX:RYM
Ryman Healthcare — H1 FY2018 Earnings Presentation
42 slides from Ryman Healthcare's earnings presentation, November 2017
Slide 1: Ryman Healthcare Half Year Results
RYMAN HEALTHCARE HALF YEAR RESULTS 30 September 2017
Slide 2: First Half Highlights
FIRST HALF HIGHLIGHTS Underlying profit up 11.4% to $85.2 million Reported profit up 8.4% to $202.6 million Interim dividend lifted to 9.5 cents per share $5.3 billion of total assets Fourteen new villages in the pipeline
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Slide 4: Continuum of Care Offering
CONTINUUM OF CARE OFFERING Oceania BUPA Arvida Summerset Metlifecare Ryman - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 Care beds and serviced apartments Independent living Ryman statistics as at September 2017. Statistics for other providers are as at their latest balance date.
Slide 5: Strong Clinical Outcomes
STRONG CLINICAL OUTCOMES 60% 50% 50% 40% 36% 38% 31% 30% 25% 23% 20% 13% 10% 0% Ryman Provider A Provider B Provider C Provider D Provider E Provider F Percentage of villages with 4 year certification Includes aged care providers with 15 or more villages
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Slide 7: Slide 7
Slide 8: Delicious new food offerings; Ryman Moves
Delicious new food offerings Ryman Moves
Slide 9: MyRyman
MYRYMAN
Slide 10: MyRyman
MYRYMAN
Slide 11: MyRyman – Rollout Complete by August 2018
MYRYMAN – ROLLOUT COMPLETE BY AUGUST 2018
Slide 12: Chris Beckett and Barbara Reynen-Rose
Chris Beckett and Barbara Reynen-Rose
Slide 13: Leadership Programme
LEADERSHIP PROGRAMME
Slide 14: 14 New Villages in the Pipeline
14 NEW VILLAGES IN THE PIPELINE Petone - NZ Pukekohe - NZ Rangiora - NZ Birkenhead - NZ Greenlane - NZ Brandon Park - Victoria Lynfield - NZ Devonport - NZ Burwood East - Victoria Coburg - Victoria Pipeline River Road - NZ of 14 villages Mount Eliza - Victoria Hobsonville - NZ Newtown - NZ Geelong -
Slide 15: Brandon Park
BRANDON PARK Melbourne
Slide 16: Lynfield
LYNFIELD Auckland
Slide 17: Mt Martha
> eet +9 —. . BENTONS SQUARE SHOPPING CENTRE [Se Sme Sat * Ss ™- aoe MT MARTHA Ss SN Victoria
Slide 18: Fourteen Sites in the Pipeline
FOURTEEN SITES IN THE PIPELINE River Road, Hamilton
Slide 19: Population Growth 75+
POPULATION GROWTH 75+ 40,000 1,400,000 35,000 1,225,000 30,000 1,050,000 25,000 875,000 20,000 700,000 15,000 525,000 10,000 350,000 5,000 175,000 0 - 2006-2011 2011-2014 2014-2018 2018-2023 2023-2028 2028-2033 2033-2038 2038-2043 2043-2048 NZ avg annual increase in population aged 75+ Victoria avg
Slide 20: Proud new sponsors of the Coburg Lions
Proud new sponsors of the Coburg Lions
Slide 21: Underlying Profit Growth
UNDERLYING PROFIT GROWTH 250 200 150 $ Millions 100 50 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 First half Second half Target range
Slide 22: Resales Bank
RESALES BANK 900 800 700 600 $Millions 500 400 300 200 100 - 2014 2015 2016 2017 2018* New Zealand Melbourne *As at 30 September. All other years at 31 March. The resales bank represents the extent that the current price exceeds the price paid by the current resident for the unit's occupancy rights
Slide 23: Total Assets
TOTAL ASSETS 6 5 4 $Billions 3 2 1 0 Sep 06 Sep 07 Sep 08 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Sep 15 Sep 16 Sep 17
Slide 24: Development Margin
DEVELOPMENT MARGIN 35% 30% 25% 20% 15% 10% 5% 0% 2012 2013 2014 2015 2016 2017 2018* Group development margin Margin excluding Bob Scott Target range *Represents first half only
Slide 25: Sales Pricing vs Median House Price
SALES PRICING VS MEDIAN HOUSE PRICE 1600 1400 1200 1000 $Thousands 800 600 400 200 0 Melbourne Auckland Median house price - area Ryman - Independent Ryman - Serviced
Slide 26: Capital Proceeds
CAPITAL PROCEEDS Gross Occupancy Advances 6 5 4 $ Billion 3 2 1 0 Sep 2012 Sep 2017 Mar 2022 * * Indicative occupancy advances
Slide 27: Long Term Capital Efficiency
LONG TERM CAPITAL EFFICIENCY $25m raised at IPO in 1999 Invested $2.8bn in portfolio since 1999 with no fresh capital Dividends of $630m paid since float Self-funded growth Strong balance sheet
Slide 28: Appendices
APPENDICES
Slide 29: Appendix 1: Management Team – Years at Ryman
APPENDIX 1: MANAGEMENT TEAM – 125 YEARS AT RYMAN Gordon MacLeod Barbara Reynen-Rose Andrew Mitchell Debbie McClure Tom Brownrigg Chief Executive Group Operations Manager Development Manager Group Sales and Community Construction Manager 11 years at Ryman 25 years at Ryman 11 years at Ryman Relations
Slide 30: Appendix 2: Reported Profit Up 8.4%
APPENDIX 2: REPORTED PROFIT UP 8.4% Underlying profit $85.2M Unrealised revaluations of RV units +$118.3M Deferred tax expense -$0.9M Reported net profit $202.6M
Slide 31: Appendix 3: Statistics
APPENDIX 3: STATISTICS Half year Half year Full year Sales of Occupation Rights Sep-17 Sep-16 Mar-17 Existing units Independent 184 166 327 Serviced 210 185 391 394 351 718 New units Independent 111 184 437 Serviced 46 59 163 157 243 600 Portfolio and Build Rate Retirement village units Independent
Slide 32: Appendix 4: Margin
APPENDIX 4: MARGIN Half year Half year Full year Sept-17 Sept-16 Mar-17 New Sales $000s $000s $000s Reference Realised Fair Value movement – new RV units (Note 3) 15,612 23,004 62,959 Sale of occupation rights – new RV units (Key statistics) 90,520 110,522 263,282 Gross development margin % 17% 21%
Slide 33: Appendix 5: Investing Cash Flows
APPENDIX 5: INVESTING CASH FLOWS 300 $15 m 250 $26 m $29 m $17 m $9 m 200 $22 m $Millions 150 $195 m $154 m $133 m 100 50 $59 m $62 m $38 m 0 H1 H2 H1 2017 2018 Purchase of land New villages Projects Village upgrades
Slide 34: Appendix 6: Investment Property Summary
APPENDIX 6: INVESTMENT PROPERTY SUMMARY CBRE Nominal Unit Price Inflation Assumption by Year Discount as at 30 September 2017 1 2 3 4 5+ Rate Auckland 1.0% 2.0% 2.4% 3.0% 3.5% 12.50% Rest of New Zealand 0.9% 1.5% 2.0% 2.8% 3.3% 13.39% Melbourne 3.6% 3.6% 3.6% 3.8% 3.9% 14.00% Growth rates and discou
Slide 35: Appendix 7: Operating Cash Flows
APPENDIX 7: OPERATING CASH FLOWS Half year Half year Full year Sep-17 Sep-16 Mar-17 Operating cash flow $000’s $000’s $000’s Resident receipts 129,971 109,348 227,665 Refundable accommodation deposits (net) 1,069 838 572 Development sales 130,324 115,834 246,116 Resales 162,523 141,706 285,476 Total
Slide 36: Appendix 8: Capital Management
APPENDIX 8: CAPITAL MANAGEMENT As at As at As at Use of Debt Sept-17 Sept-16 Mar-17 000’s 000’s 000’s 1,000 Net debt 945 703 838 900 Net equity 1,805 1,463 1,652 Net equity plus debt 2,750 2,166 2,490 Projects and Head Office 800 Gearing ratio * 34% 33% 34% Generators 700 Total assets and gearing ra
Slide 37: Appendix 9: Resale Stock
1.6% 1.4% 1.3% 1.4% 1.4% 1.2% 1.2% 1.0% 0.9% 1.0% 0.8% 0.8% 0.8% 0.6% 0.5% 0.4% 0.2% APPENDIX 9: 0.0% H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 Resale Stock 2014 2015 2016 2017 2018 Available resales stock Average As at Sept-17 As at Sept-16 As at Mar-17 Total Resales stock 46 47 32 Total retirement portfolio 6
Slide 38: Appendix 10: Value of Contracts Not Booked
APPENDIX 10: VALUE OF CONTRACTS NOT BOOKED 250 200 150 $ Millions 100 50 - Sept-15 Mar-16 Sept-16 Mar-17 Sept-17 Note: Presales are unconditional occupation rights agreements which have been entered by residents but have not been booked as the unit is not yet near complete
Slide 39: Appendix 11: Resident Average Age & Tenure
APPENDIX 11: RESIDENT AVERAGE AGE & TENURE 88 As at As at As at 87 Sept-17 Sept-16 Mar-17 86 Resident average age (years) Independent 82.2 82.3 82.3 85 Serviced 87.5 87.5 87.6 Years 84 Care centre 86.2 86.2 86.1 83 Half year Half year Full year 82 Sept-17 Sept-16 Mar-17 81 Average tenure - vacated r
Slide 40: Appendix 12: Cash Management Fees
APPENDIX 12: CASH MANAGEMENT FEES Half year Half year Full year Sept-17 Sept-16 Mar-17 $000s $000s $000s Reference Accrued Management Fees – Opening (Note 4) and PY financials 270,370 227,154 227,154 Less: Accrued Management Fees – Closing (Note 4) -297,249 -246,409 -270,370 Movement in Accrued Mana
Slide 41: Appendix 13: Land Bank
APPENDIX 13: LAND BANK Hospital Dementia Resthome Serviced Independent Total NEW ZEALAND Existing Sites Jean Sandel New Plymouth - - - - 59 59 Kiri Te Kanawa Gisborne - - - - 26 26 Bob Scott Lower Hutt - - - - 74 74 Bert Sutcliffe Auckland - - - - 151 151 Possum Bourne Pukekohe - - - - 29 29 Charles
Slide 42: Appendix 14: Asset Base
APPENDIX 14: ASSET BASE Hospital Dementia Resthome Serviced Independent Total (as at 30 September 2017) Anthony Wilding Christchurch 80 33 35 50 110 308 Bert Sutcliffe Birkenhead 40 40 40 81 106 307 Bob Owens Tauranga 40 40 40 79 218 417 Bob Scott Petone 40 40 34 89 180 383 Bruce McLaren Auckland 41