Oceania Healthcare Triples Assets and Cuts Gearing to 36.3% in 2025

Modernizing for the Future

Oceania Healthcare’s 2025 Annual Shareholders Meeting revealed a company in transformation. Since its 2017 ASX listing, Oceania has tripled its total assets to nearly $3 billion, driven by a strategic overhaul of its portfolio. Now, 88% of its care homes and retirement villages are either newly developed or recently acquired, reflecting a deliberate shift towards modern, higher-quality living environments that better meet residents’ evolving needs.

This portfolio renewal also includes a recalibration of the business mix, aiming for a more balanced offering between care services and independent living options. Notably, half of the care component is now under Occupation Right Agreements, signaling a move away from legacy models towards sustainable, resident-focused solutions. The company has exited 18 sites that no longer align with its long-term vision, underscoring a disciplined approach to asset management.

Dividend Policy and Financial Health

Oceania’s updated dividend policy introduces greater flexibility, targeting a payout ratio of 40% to 60% of free cash flow from operations, excluding development cash flows. This change reflects a pragmatic stance on capital management, balancing shareholder returns with the need to fund growth and operational improvements. The board’s decision not to pay an interim dividend earlier this year, and to withhold a final dividend for FY25 pending half-year results, highlights a cautious approach amid ongoing transformation.

Financially, the company has strengthened its position. Gearing has improved to 36.3%, down from 38.3% the previous year, supported by asset sales and operational efficiencies. Oceania also refinanced its $500 million loan facility on favorable terms, maintaining strong lender confidence. With $97 million in unused debt capacity, the company retains flexibility to pursue strategic opportunities.

Risk Management and Sustainability

Risk oversight remains a priority, with the board’s dedicated Risk Committee focusing on emerging challenges such as clinical safety, cybersecurity, and climate change. Oceania has made notable progress in sustainability, publishing its second climate-related report under New Zealand’s mandatory framework and unveiling its first formal Climate Transition Plan. The company’s efforts to reduce emissions, manage waste, and design energy-efficient buildings earned it a finalist spot for the Sustainability Leadership award at the 2024 Deloitte Top 200 Awards.

Looking Ahead – A New Strategic Chapter

Under CEO Suzanne Dvorak’s leadership, Oceania is embarking on a new five-year plan that builds on its strengths and focuses on improving resident outcomes, workforce development, and long-term sustainability. With New Zealand’s population aged 75 and over expected to double by 2050, Oceania positions itself as a key player ready to meet rising demand. The board’s full support for this strategy signals confidence in the company’s clear and differentiated path forward.