Ryman Healthcare Turns Cash Flow Positive, Boosts Sales Outlook

A Decade-Long Turnaround Achieved

Ryman Healthcare has marked a significant milestone in its financial journey by reporting its first positive free cash flow in over ten years, reaching $56.2 million for the six months ended September 2025. This turnaround reflects the success of a comprehensive transformation strategy, including a $1 billion equity raise earlier this year and a full refinancing of its $2 billion bank facilities, which have reset the company’s balance sheet and aligned funding with its operational needs.

Chief Executive Naomi James emphasised that the business has stabilised and momentum is returning, with meaningful progress against FY26 priorities. The company’s refreshed sales strategy and cost-out initiatives are exceeding expectations, underpinning confidence in its new pricing model featuring a 30% deferred management fee (DMF).

Operational and Financial Highlights

Ryman’s revenue grew 13%, supported by both higher pricing and increased utilisation across its retirement villages and aged care facilities. Meanwhile, total costs fell by 2%, driven by disciplined cost management and operational efficiencies. Despite these improvements, the company reported a net loss after tax of $45.2 million, primarily due to reduced fair value gains compared to the prior year and the impact of a larger share base following the equity raise.

Sales volumes are on the rise, with 704 units sold in 1H26, showing sequential growth across both quarters. This positive sales momentum has led Ryman to upgrade its full-year sales guidance to between 1,300 and 1,400 occupation right agreements (ORAs), up from the previous range of 1,100 to 1,300. The uplift in average DMF from 20.7% to 28.8% on ORA sales further supports revenue growth prospects.

Strategic Developments and Market Positioning

Ryman is advancing a strategic review of its capital management framework, including dividend policy, with updates expected at its investor day in February 2026. The company has also appointed Richard Stephenson as Chief Development and Property Officer, signalling a renewed focus on disciplined growth and high-quality community delivery.

Development projects are progressing well, with major buildings completed at Kevin Hickman and Nellie Melba villages, and others under construction. The company is aligning future development stages with market demand, reflecting a cautious but confident approach to expansion.

Navigating Aged Care Reforms

Ryman welcomes the New Zealand Government’s formation of a Ministerial Advisory Group tasked with recommending aged care funding reforms. These reforms are critical to addressing sector underfunding and ensuring long-term sustainability. Ryman’s high occupancy rates and strong pricing growth in aged care underscore its readiness to adapt to and benefit from these changes.

In Australia, recent amendments to the Aged Care Act are expected to enhance government funding models, potentially boosting revenue through changes to refundable accommodation deposits.

Outlook and Market Conditions

Looking ahead, Ryman anticipates sales in the second half of FY26 to remain broadly consistent with the first half, amid mixed market conditions and varying property market recoveries across regions. Cost savings initiatives are ahead of plan, with annualised savings now targeted at $50–60 million by year-end.

Ryman’s management remains focused on building sales momentum, releasing cash, and driving operational efficiencies. The company is well positioned to benefit from demographic trends, housing market rebounds, and sector reforms, setting the stage for sustainable growth.