Third Age Health Services boosts FY26 profit 25% with strategic acquisitions
Third Age Health Services Limited lifted revenue by 18% to NZD 22.49 million in FY26, driven by acquisitions and aged care growth, while net profit after tax rose 25% to NZD 3.09 million.
- Revenue grows 17.9% to NZD 22.49 million
- Net profit after tax rises 24.7% to NZD 3.09 million
- Acquisitions of ARC Health and Cicada Health expand regional footprint
- Final dividend declared at 4.00 cents per share, total FY26 dividends 16.00 cents
- Goodwill and intangible assets increased with acquisitions, no impairment recorded
Profit and Revenue Growth Fueled by Acquisitions
Third Age Health Services Limited (NZX:TAH) reported a solid uplift in earnings for the year ended 31 March 2026, with revenue climbing 17.9% to NZD 22.49 million from NZD 19.08 million the prior year. Net profit after tax surged 24.7% to NZD 3.09 million, up from NZD 2.48 million. The company’s growth was underpinned by acquisitions and expansion in its aged residential care services segment, which saw revenue jump 27%.
Two key acquisitions completed on 1 September 2025; ARC Health Limited in Canterbury and Cicada Health Limited in Tauranga; contributed NZD 1.9 million in combined revenue and NZD 400,000 in net profit after tax for the seven months owned. These deals extend Third Age’s footprint in critical regions and deepen its aged care medical services capabilities.
Segment Performance and Profitability
The Group’s aged medical care services segment generated NZD 14.92 million in revenue, up from NZD 11.75 million, delivering NZD 3.60 million in profit before tax. The general practice medical services segment was stable, with revenue of NZD 7.57 million and profit before tax of NZD 782,000. EBITDA across the Group rose to NZD 5.75 million, a 23% increase over the previous year.
Costs of services increased in line with revenue, reflecting higher practitioner fees and medical supplies, while operating expenses remained well controlled. Finance costs dipped slightly to NZD 303,000 despite acquisition-related deferred consideration interest charges.
Balance Sheet Strength and Intangible Assets
The balance sheet showed growth in total assets to NZD 13.21 million, driven by goodwill and intangible assets rising to NZD 6.67 million from NZD 4.77 million. Goodwill increased primarily due to the ARC Health and Cicada Health acquisitions, with no impairment recorded following annual testing under conservative assumptions. Intangible assets include patient databases, enrolled service users, and PHO agreements amortised over 4 to 10 years.
Net assets rose to NZD 5.51 million, supported by retained earnings growth and a stable share capital base of 9.95 million shares. The Group maintains a bank loan facility with ANZ, with drawn amounts of NZD 1.09 million at fixed rates around 6.85% and an undrawn overdraft facility of NZD 656,000.
Dividend Policy and Shareholder Returns
The Board declared a final dividend of 4.00 cents per share, bringing total dividends for FY26 to 16.00 cents per share, up from 13.53 cents the prior year. Dividend payments to non-controlling interests also increased, reflecting the contributions of acquired subsidiaries.
Share buybacks were paused in FY26 following a modest on-market buyback in FY25. The Board’s focus remains on balancing growth investments with shareholder returns.
Governance and Leadership Changes
John Samuel Ronny Fernandes was appointed Executive Chairman on 13 October 2025, stepping down from the Audit Committee. The company currently operates without a formally appointed CEO, with executive responsibilities distributed between the Executive Chairman and general managers. Fernandes’s remuneration includes a base fee of NZD 120,000 plus a performance-based incentive tied to revenue growth and return on invested capital.
The Board comprises four directors, including two independent members, maintaining robust oversight despite the Executive Chairman’s non-independent status. The Audit Committee is chaired by independent director Wayne Geoffrey Williams.
Audit and Key Financial Risks
UHY Haines Norton Chartered Accountants audited the financial statements, issuing an unqualified opinion. Key audit matters addressed included revenue recognition, intangible assets and goodwill impairment testing, and business acquisition accounting. The Group’s revenue recognition policies and acquisition accounting were found appropriate and compliant with NZ IFRS.
Deferred contingent consideration liabilities related to acquisitions are valued at NZD 465,000, subject to performance conditions. Management expects full payment but acknowledges sensitivity to key assumptions. The Group’s credit risk remains low, with cash held at major New Zealand banks and minimal bad debt experience.
What to Watch Next
Investors should monitor the integration progress of ARC Health and Cicada Health and the realisation of deferred contingent consideration payments. The absence of a formal CEO and the Executive Chairman’s dual role may invite scrutiny on governance effectiveness. Dividend sustainability amid ongoing acquisition activity and goodwill valuations also merit attention.
Third Age Health Services is positioned to capitalise on New Zealand’s ageing population, but execution risks around acquisitions and margin pressures in aged care remain key uncertainties.
For a deeper dive into the company’s FY26 profit growth and acquisition impact, see our recent coverage of Third Age Health’s profit rise on acquisitions.
Bottom Line?
Third Age Health Services’ solid FY26 results reflect growth through acquisitions and aged care expansion, but investors should watch how integration and governance evolve amid leadership changes.
Questions in the middle?
- How will the Executive Chairman’s dual role affect governance and strategic execution going forward?
- Will deferred contingent consideration payments fully materialise amid operational uncertainties?
- Can Third Age sustain dividend growth while continuing its acquisition-driven expansion?
