Ryman sets 70% growth target

Ryman Healthcare managing director Simon Challies. Photo: Natalie Slade.

Retirement village operator says new sites will lift resident numbers to 15,500 by 2020.

Ryman Healthcare, New Zealand's largest retirement village operator, plans to increase resident numbers by 70 per cent in the next five years in New Zealand and Australia as it also mulls an ASX listing.

Ryman chairman David Kerr told the company's annual general meeting in Auckland it had bought a new site in Hamilton and was close to signing up for one in Melbourne that would help its strategy to increase resident numbers from 9000 currently to 15,500 by 2020.

Kerr said the group had a strong capital base to speed up its development plans and had identified Melbourne and Auckland as having the greatest potential because of projected demand from the ageing population.

It plans to build five villages in Melbourne and at least 10 in Auckland by 2020 while the other 400 units of the additional 1200 per year planned will be in other parts of New Zealand. Previously the company has built between 700 and 800 units per year.

Chief executive Simon Challies said the company currently housed 2000 of Auckland's 76,000 people aged over 75 years and by 2020 its share will have moved to 4500 out of a projected 95,000 aged over 75.

One shareholder, John Boscawen, asked why the company wasn't being even more ambitious in its expansion plans, given projected demand.

"You're targeting 1200 units but why not 2000 or 2500? There is a huge opportunity," Boscawen said.

Kerr said the company was fairly conservative and in the business of looking after older and more vulnerable people.

"We can't afford to trip up. So we don't want to run so fast that we trip," he said.

Kerr said he was pleased with progress in Melbourne where Ryman officially launched its first village less than a year ago. It has almost sold all of the first village, is close to starting work on its second site at Brandon Park, and has a village site in eastern Melbourne close to settling. The market opportunity in Melbourne is more than a third larger than in Auckland.

In Auckland, work is under way on villages at Birkenhead, Greenlane and Pukekohe and it's in the final stages of completing the Bruce McLaren village in Howick where the annual meeting was held. Other new villages planned include ones in Devonport, Newtown in Wellington, and Tropicana Farm in Auckland.

Another shareholder, Aaron Bhatnagar, asked whether the board was considering an ASX listing, given two of its rivals had done so.

Kerr said it was something the board was seriously considering but it wanted to wait until the planned alignment of Australian and New Zealand listing rules was complete.

One of the key benefits would be that many of its residents also want to be shareholders in the company and there would be growing demand for shares as it gets more residents in Australia, Challies said.

The company has also unveiled a new paperless records system called MyRyman that has cost an estimated $10 million to develop. Challies said they went hunting for a system that would allow staff to spend less time on paperwork and more time with residents but there was nothing in the world that met their needs so they have developed their own. It's about to be beta-tested in Christchurch and Challies expects the system to be rolled out by the end of next year.

The system, which fits wifi in the villages and a tablet in each resident's room, should save between 10 per cent to 20 per cent of the time staff spend on paperwork, Challies said.