Ryman Healthcare's two Melbourne retirement villages have been in lockdown for the past month and its construction sites are now quiet after Victoria ushered in tough anti-pandemic measures.
New Zealand's largest listed retirement specialist updated the market this morning about the impact of the Victorian Government's latest restrictions to prevent the spread of Covid-19.
Ryman shares have slid from $17 in January to $13.30 today. The business had told the market previously it had intended to have a significant portion of its assets in Australia as it expanded out of this country.
"Ryman's two operational villages, Weary Dunlop and Nellie Melba, have been in lockdown for the past four weeks with visiting restricted and full pandemic infection control measures in place," it said today.
The village teams had been delivering groceries and essential supplies to residents and helping to ensure they can keep in touch via Zoom and phones.
The Victorian Government yesterday afternoon announced an additional level 4 lockdown restrictions for the next six weeks after hundreds of new cases of coronavirus were recorded daily and the death toll mounted.
"These restrictions mean work at our Nellie Melba, Burwood East and Aberfeldie construction sites will be significantly reduced over the next six weeks.
The state government will provide more guidance in the next few days, and the restrictions will come into force at midnight on Friday.
"Construction on our Highton and Ocean Grove villages, which are outside metropolitan Melbourne and are not subject to the Level 4 lockdown restrictions, will be able to continue in the meantime," Ryman said.
"New residents can move into Weary Dunlop and Nellie Melba within the health guidelines. Sales appointments in person are restricted but can continue over Zoom, and our sales teams are working to keep all our prospective buyers up to date," it told the market.
"At this early stage of the lockdown it is hard to predict what impact it may have on our previously communicated target of delivering 900 beds and units in the 2021 financial year," it said.
Ryman is the largest listed company in the sector with 36 villages. It is holding its AGM Christchurch next Thursday.
The company in June reported a 6.6 per cent rise in underlying annual profit to $265 million for the year ended March due to independent valuer CBRE chopping $70.9 million off the value of the company's retirement villages – the previous year, the portfolio was revalued upwards by $102.4 million.
The underlying $242 million result compared with the forecast $250 million to $265 million which the company withdrew in March when it had to shut down all construction activities as the nation went into lockdown to combat the spread of covid-19.
While the elderly proved particularly susceptible to covid-19, Ryman had no cases of infection at any of its 36 retirement villages in New Zealand or the three villages in Melbourne.