Summerset Group, New Zealand's third-largest retirement village operator, increased first-half profit at a slower pace as it focuses on developing villages for future growth.
The Wellington-based company said net profit rose 42 percent to $15.3 million in the six months ended June 30, lagging last year's first-half profit growth of 174 percent. Revenue rose 19 percent to $25.2 million, helped by increased occupancy of new villages.
Summerset, which doubled its annual profit last year on record sales of occupation rights, has said earnings growth is likely to slow this year as the company acquires sites for new villages. The company recently opened two villages in Auckland, and will open its New Plymouth village this year, while almost doubling the size of its Trentham village, meaning the company expects strong settlements over the remainder of 2014, it said today.
"Having delivered 136 retirement units in the first half of this year, we are in good stead to achieve our target of delivering 250 retirement units this year," said chief executive Julian Cook. "We are on track to achieve a build of 300 retirement units per annum from next year."
Retirement village companies are acquiring land and preparing for a record building spree in anticipation of increased demand as people born in New Zealand's post-war era start to reach the target age for operators, including Summerset and its larger rivals Ryman Healthcare and Metlifecare.
