Retirement village owner Summerset Group will repay the $8.6 million government wage subsidy, has issued new profit guidance and chairman Rob Campbell is retiring.
Metlifecare, Arvida and now Summerset all repaid the subsidy when the pandemic's effects actually resulted in sales rebounding, resulting in one village chief saying this morning: "Just Ryman Healthcare and Oceania to go!"
The 29-village-owning Summerset said it had made the decision to repay the Covid-19 wage subsidy it received in April. It qualified for that because revenue fell by more than 30 per cent in April "when retirement unit sales fell to zero".
Rival Metlifecare had earlier repaid its $6.8m wage subsidy.
After April, Summerset went on to report an underlying profit of $45.1m for the first half of 2020 when revenue rose from last year's $74m to $82m.
Outgoing chairman Campbell said the board had been monitoring the situation "and had decided the time was right to return the wage subsidy. Summerset was in a stable financial position and the business outlook was positive."
Questions have been put today to Ryman and Oceania about how much they got and whether they will repay the subsidy.
Summerset has had no Covid cases in its many villages, it said.
Underlying profit for the December 2020 year will be $96m to $98m, it said today.
Campbell will retire from the board in April after chairing it for 10 years. He oversaw Summerset's listing on the NZX in 2011. Summerset is now in the NZX's top 20 companies.
"Under his leadership, Summerset has grown to be the second-largest retirement village operator in New Zealand, with a market capitalisation of $2.5b. Assets have increased from $540m to $3.4b over the decade, and resident numbers have gone from 1700 to over 6000," the company said.
"We would like to thank Rob for his outstanding leadership. During his time we have invested in memory care centres for people living with dementia, improved our offering for staff, become New Zealand's first carbon zero retirement operator, and more recently, have expanded across the Tasman. His depth of experience and genuine passion for the people at Summerset will be missed," it said.
The board has already started to hunt for a new chairman.
The company is also losing its chief executive Julian Cook. On November 9, he said he would step down in March after more than 10 years with the business of which seven had been as CEO.
Campbell praised Cook at the time, saying he had been an outstanding chief executive. Deputy chief executive and chief financial officer Scott Scoullar is replacing Cook.
Last month, Metlifecare said it didn't need the wage subsidy either.
Paul McClintock, chairman, said the whole Metlifecare team had done an extraordinary job in managing the Covid-19 crisis and should be commended.
"Metlifecare maintained its high standards of care for residents while also supporting the safety and health of its staff throughout this challenging period. While Covid-19 has created significant and lasting economic uncertainty globally and in New Zealand, and Metlifecare did qualify for the scheme, EQT and the board has now determined that repaying the wage subsidy is the right thing to do," McClintock said.
Metlifecare has been delisted from the NZX after EQT succeeded in its takeover.
Arvida repaid the $400,000 it received on November 30.