Can Ryman Sustain Growth Amid Aged Care Reforms and Market Challenges?

A Strategic Reset for Sustainable Growth

Ryman Healthcare, a leading provider in aged care and retirement living across New Zealand and Australia, has laid out a comprehensive plan at its Investor Day 2026 to enhance shareholder value through a refreshed strategy. The company is shifting its focus from rapid development growth to prioritising high-quality recurring earnings, portfolio optimisation, and disciplined capital management.

Central to this strategy is a target to improve sustainable cash flow by $150 million by the fiscal year 2029. This will be achieved through a combination of growing occupancy rates, resetting pricing models, and implementing cost efficiencies across operations. The company emphasises operational excellence and improved sales effectiveness as key drivers to unlock this potential.

Unlocking Cash and Optimising the Portfolio

Ryman expects to generate strong cash flow from a targeted $500 million cash release by FY29. This includes $470 million from new sales stock, $330 million from paid-out resale stock, and at least $200 million from land sales. The company holds a substantial land bank with over 2,500 units and beds in uncommitted developments, offering significant optionality for future portfolio growth.

The portfolio growth strategy is disciplined, focusing on brownfield expansions where existing village infrastructure can be leveraged, as well as greenfield developments in markets with enduring demand and strong capital growth potential. The company is also actively reviewing its land holdings to prioritise high-return opportunities and divest non-core assets.

Capital Management and Dividend Policy

Ryman has reset its balance sheet to achieve one of the lowest gearing levels in the industry, with a flexible funding capacity and a lower cost of capital. The capital management framework is designed to balance sustainable dividends, debt reduction, reinvestment, and portfolio growth. The company plans to recommence dividends from FY28, with a payout policy targeting 20–50% of cash flow from existing operations.

This prudent approach aims to provide resilience against market fluctuations while maintaining optionality for growth or shareholder returns. The company’s management team, including new appointments in development and finance roles, is positioned to execute this strategy effectively.

Market Position and Demographic Tailwinds

Ryman’s integrated model of retirement living and aged care, combined with a strong brand and high resident satisfaction, positions it well to capitalise on demographic trends. The population aged 80 and over is expected to double by 2050 in both New Zealand and Australia, driving demand for flexible, care-centred living options.

The company is also navigating regulatory reforms in aged care, particularly in Australia where new funding models are in effect, and New Zealand where reforms are anticipated. These changes are expected to support sustainable returns and enable Ryman to enhance its care offerings.

Looking Ahead

With a clear roadmap to grow recurring earnings, optimise its portfolio, and manage capital prudently, Ryman Healthcare is setting the stage for long-term value creation. The company’s focus on operational excellence, pricing resets, and strategic growth initiatives aims to deliver sustainable shareholder returns while meeting evolving resident needs.