Summerset Group, the retirement village operator and developer that listed in November, missed its forecast for annual profit due to tax adjustments, but beat expectations for underlying earnings by 35 per cent.
Net profit was $4.3 million, or 2.39 cents per share, in the 12 months ended December 31, missing the $5 million forecast in last year's prospectus, but turning around a loss of $1.9 million, or 1.12 cents per share, a year earlier, when the company was still in private ownership.
Underlying earnings of $8.1 million beat the $6 million expected as the retirement village operator enjoyed sales growth and the early delivery of new developments. Revenue fell to $33.7 million from $34.2 million in 2010.
"Our new developments performed very well and existing villages experienced uplift in demand driven by a number of factors, including an increased brand profile and effective marketing initiatives," chief executive Norah Barlow said in a statement. "The growth in Summerset's village footprint has been reflected in its financial performance."
Summerset debuted on the NZX at 3.6 per cent above its initial public offering price of $1.40, when Australia's Quadrant Private Equity sold down its stake in the company and raised $50 million of new equity. The shares were unchanged at $1.42 yesterday, just 2 cents above its IPO price.
The private equity firm completed the acquisition of Summerset in 2010 when the Overseas Investment Office signed off on the deal, buying the 50 per cent it didn't already own from fund manager AMP Capital Investors New Zealand. It still owns 56 per cent of the company.
AMP Capital sold up after failing to get the retirement village operator away in a public float in 2007. Quadrant came on board in 2008, investing A$90.5 million of an A$500 million private equity fund.
Summerset chairman Rob Campbell said the company is well-placed to cater to New Zealand's "significant increase in demand for both retirement village units and aged care beds."
The retirement village operator opened two new villages last year, one in Nelson and one in Hamilton, and is still developing sites in Warkworth, and Hastings. It completed work at its Manukau site, which will be Summerset's biggest investment, Barlow said.
Summerset delivered 122 units last year, one ahead of its IPO forecast, and sold 108 occupation rights, beating expectations by six. Some 123 resales of occupation rights were 6 per cent ahead of forecast.
As at December 31, the company's total assets were worth $617 million, up from $537 million a year earlier. It expects to deliver 155 units this year.