Summerset 3Q sales slip 4.5% as new units awaited

Thursday 4th October 2018

Summerset's third-quarter sales fell 4.5 percent as the retirement village operator waits for a large number of new units to come on stream.

Total sales of occupation rights declined to 148 in the three months ended Sept. 30 from 155 a year earlier. Of that, 83 were sales of new units, down 15 percent from a year earlier. Resales were up 14 percent at 66.

Summerset's quarterly new sales have tracked behind 2017. Chef executive Julian Cook expects a pick-up in the final three months of the year.

"Total sales have remained at consistent levels across the year, and we continue to expect higher sales in the final quarter of 2018, with a large proportion of retirement units built this year being delivered in the fourth quarter," he said.

Resales delivered strong earnings for Summerset in the first half of 2018, underpinning a 27 percent lift in underlying earnings to $45.2 million. Resales of 220 units were up 8.9 percent in the year-to-date.

The company completed 165 new units in the first six months of 2018 and today said it's still on track to deliver the 450 forecast for the calendar year.

Summerset has 23 villages completed or under development with 3,443 retirement units and 858 care beds. Its land bank has the potential to add 3,041 units and 368 care beds.

The shares last traded at $7.75 and have gained 41 percent this year, making it the best performing listed retirement village operator and developer so far this year.

(BusinessDesk)

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