Metlifecare loss more than doubles on writedown of property investments

Thursday 27th August 2009

Metlifecare Ltd, the operator of 17 retirement villages, said its full-year loss more than doubled, reflecting a write down in the fair value of its property investments.

The net loss was NZ$115.7 million, or 120.3 cents a share, in the 12 months ended June 30, from a loss of $53.1 million, or 60.7 cents, a year earlier, the Auckland-based company said in a statement. The value of its investment properties was cut by $107 million to $1.13 billion. Operating revenue edged up 0.3% to $58.6 million as the company maintained its occupancy levels

“The effect of the housing downturn was that potential new residents found that it was either very difficult or that it took much longer than they anticipated to sell their homes in order to fund entry to our villages,” said chairman Charles MacDonald. He said requirements of IFRS accounting, which requires changes in values to be recognised, “distracts from our operational performance.”

The shares rose 3.8% to $2.28 on light trading volume and have gained 11% in the past six month. The company won’t pay a final dividend “in the interests of prudent capital management.”

Metlifecare has a new chairman and chief executive after Jim McLay left for a UN post and Richard de Haast resigned as head of the company. The general manager for sales and marketing, Gaynor Anderson, is also departing. Alan Edwards took over as CEO this month.

The company secured new lines of credit from its banks until the end of June next year, and in March raised $37.4 million by selling new shares.

In June, the retirement village operator opened its Takapuna development, which will add some 11% to the company’s portfolio when the second stage is completed next year.

Businesswire.co.nz

Comments from our readers

No comments yet