Summerset’s Growth Hinges on Australian Expansion and Care Unit Shift

Strong Financial Performance Amid Economic Challenges

Summerset Group Holdings Limited has delivered a solid first half for 2025, reporting an underlying profit of NZ$106.6 million, a 19% increase over the same period last year. The company’s IFRS net profit after tax rose even more sharply, by 26% to NZ$127.2 million, underscoring the strength of its operational growth despite a still-challenging economic environment in both New Zealand and Australia.

Operating cash flows climbed 19% to NZ$228.7 million, while total assets expanded by 18% to NZ$8.7 billion. The company maintained a prudent gearing ratio of 36.7%, comfortably within its target range of 30% to 40%, reflecting disciplined balance sheet management as it continues to invest in growth.

Record Sales and Development Momentum

Summerset achieved a record 692 sales of occupation rights in the first half, comprising 354 new sales and 338 resales. New sales were particularly strong, up 22% on the prior year, with key villages such as Pāpāmoa Beach, St Johns, Bell Block, and Boulcott leading the charge. The company delivered 334 new units across New Zealand and Australia, including 321 in New Zealand and 13 in Australia, maintaining its position as the fastest growing retirement village developer in New Zealand.

The development margin remained robust at 29.4%, exceeding the company’s long-term guidance of 20% to 25%. This margin strength was supported by improved settlement volumes and premium pricing, particularly at the flagship St Johns village, which also received an Excellence award at the New Zealand Property Council awards.

Innovations in Care and Resident Experience

Summerset is advancing its care offerings by transitioning many care units to be sold under Occupation Rights Agreements (ORAs), allowing residents to use equity in their homes to fund care rather than daily premiums. This shift has significantly improved care EBITDA, which nearly doubled to NZ$5.3 million compared to the prior year. The company also reopened fully refurbished care centres at Havelock North and Trentham, featuring modern suites with ensuites and kitchenettes, enhancing resident comfort and dignity.

Resident satisfaction remains a cornerstone of Summerset’s strategy, with a record 97% satisfaction rate maintained across villages and care centres. The company continues to invest in community engagement, activities, and food services, alongside technology initiatives such as the Lumin resident communication platform and robotic maintenance equipment, all aimed at enriching the resident experience.

Australian Expansion on Track

Summerset’s Australian operations are gaining momentum, with three villages under construction and the first main building at Cranbourne North due for completion by the end of 2025. The company expects to deliver between 50 and 80 homes in Australia this year, with plans to scale to approximately 300 units within three years. Construction is progressing at Chirnside Park and Torquay, with Oakleigh South scheduled to commence in late 2025. The Australian land bank now comprises over 2,100 units, with more than 60% consented, positioning Summerset well for sustained growth in this market.

Outlook and Dividend

Looking ahead, Summerset remains optimistic about maintaining its sales momentum into the second half of 2025, supported by a strong committed sales pipeline. The company forecasts delivering between 700 and 780 new homes across New Zealand and Australia for the full year. While mindful of economic uncertainties, Summerset emphasizes its commitment to balancing growth with resident satisfaction and operational excellence.

The Board declared an unimputed interim dividend of 11.3 cents per share, reflecting confidence in the company’s cash flow and profitability. The dividend record date is 11 September 2025, with payment scheduled for 24 September 2025.