Summerset Group Holdings delivered a record underlying profit of NZ$234.2 million in FY25, driven by strong sales and portfolio growth, while advancing its Australian village developments. Despite a dip in IFRS net profit due to portfolio revaluations, the company maintains a positive outlook with high resident satisfaction and sustainability milestones.
- Record FY25 underlying profit of NZ$234.2 million, up 13%
- IFRS net profit after tax declined 22% to NZ$259.7 million due to portfolio revaluations
- 1,560 total sales of occupation rights, a 26% increase on FY24
- Delivered 693 new units under occupation right agreements across NZ and Australia
- Strong resident satisfaction at 91% for villages and 89% for care services
Robust Financial Performance Amid Market Challenges
Summerset Group Holdings Limited has reported a record underlying profit of NZ$234.2 million for the 2025 financial year, marking a 13% increase over the previous year. This growth was primarily driven by a strong sales performance and ongoing expansion of its retirement village portfolio across New Zealand and Australia.
However, the company’s IFRS net profit after tax declined by 22% to NZ$259.7 million, reflecting the impact of lower median house prices on portfolio revaluations. Despite this, Summerset’s total assets grew 15% to NZ$9.2 billion, with net tangible assets per share rising to NZ$13.75, up 11% from FY24.
Sales and Development Milestones
Summerset achieved its highest-ever sales year with 1,560 occupation right agreements (ORAs) settled, a 26% increase on FY24. This included 805 new sales and 755 resales, supported by a committed sales pipeline of 267 new and 178 resale units entering FY26.
The company delivered 693 new homes under ORAs, with 637 units in New Zealand and 56 in Australia. Notably, the Australian expansion gained momentum with the completion of the first village centre building at Cranbourne North, Victoria, and the delivery of the first villas at Chirnside Park. Construction is underway at additional Australian villages including Torquay and Oakleigh South, targeting a medium-term build rate of approximately 300 units annually by FY27.
Resident Satisfaction and Care Profitability
Summerset maintained high resident satisfaction scores, with 91% of village residents and 89% of care residents expressing satisfaction. The transition to selling care suites under ORAs has significantly improved care profitability, with care EBITDA rising to NZ$18.8 million from NZ$2.7 million the previous year. The company targets further growth in care EBITDA per bed to between NZ$20,000 and NZ$25,000 over the medium term.
Sustainability and Operational Efficiency
Summerset continues to lead in sustainability, accelerating its transition away from gas with a target to remove gas supply from all villages by 2028. Over 1,500 solar panels were installed during the year, contributing to energy resilience and cost savings. The company diverted 5,624 tonnes of construction waste from landfill and achieved an 'A' rating from the Carbon Disclosure Project, placing it among global leaders in climate action.
Operationally, Summerset is leveraging technology to enhance efficiency and resident experience, including piloting AI solutions for nursing staff and expanding its resident communication platform, Lumin, to 20 villages.
Balance Sheet Strength and Dividend Policy
The company’s gearing ratio remains within its target band at 37.1%, supported by undrawn debt capacity of NZ$627 million. Summerset’s Board declared a final dividend of NZ13.2 cents per share, maintaining a full-year dividend of 24.5 cents per share, consistent with FY24. A formal review of the dividend policy is scheduled for FY26 to ensure alignment with long-term growth objectives.
Leadership and Governance Updates
Summerset announced the creation of a Chief Sales and Marketing Officer role to unify these functions and accelerate market responsiveness. The company also welcomed David Martin to lead this transformation. Meanwhile, two senior executives, Fay French and Kay Brodie, are stepping back or retiring from executive roles, signaling a leadership transition phase.
Summerset remains committed to strong governance and ethical standards, with its Board fully compliant with the NZX Corporate Governance Code and focused on diversity, inclusion, and risk management.
Bottom Line?
Summerset’s FY25 results underscore its resilience and growth potential, but investors will watch closely how Australian expansion and regulatory changes shape future performance.
Questions in the middle?
- How will the transition to selling care suites under ORAs impact long-term care profitability?
- What are the risks and opportunities in Summerset’s Australian expansion amid evolving aged care regulations?
- How might proposed changes to the Retirement Villages Act affect smaller operators and Summerset’s competitive positioning?