Ryman Healthcare (RYM) H1 2025 earnings summary

Executive summary

• Net profit after tax fell 50% to $94.4 million for the six months ended 30 September 2024, with negative cash flow from existing operations and a renewed board and executive team, including a new CEO and functional structure.

• Revenue rose 10% year-over-year to $366.3 million, driven by increased care and village fees, new openings, and higher deferred management fees.

• Significant business improvement initiatives delivered $18 million in annualised savings, with further cost reductions targeted and a new pricing structure launched.

• Major accounting policy changes and restatements were implemented for greater transparency and comparability, including DMF revenue recognition and reclassification of development land.

• No interim dividend declared; dividend policy to be reviewed in FY26.

Financial highlights

• Net profit before tax and fair value movements was a loss of $79.8 million, down year-over-year; net profit after tax was $94.4 million, down 50% from $187.1 million.

• Revenue rose to $366.3 million, up 10% year-over-year, while operating expenses increased 18% to $351.7 million.

• Cash flow from existing operations was -$7.8 million, down $24.8 million year-over-year; cash flow from development improved to -$44.7 million, a $132 million improvement.

• Gross receipts from ORA sales reached $651.4 million, up 5% year-over-year; gross resale margin compressed to 26.6%.

• Net interest-bearing debt at period end was $2.56 billion, with gearing at 37.3%.

Outlook and guidance

• Free cash flow for FY25 now expected to be negative $50–100 million, revised from previous positive guidance, as settlements are deferred into FY26.

• Capital expenditure guidance reduced to $625–675 million.

• Delivery/build rate of retirement units and aged care beds expected at the top end of 850–950.

• Further business improvement savings targeted by end of FY26.

• Challenging economic and housing market conditions in New Zealand and Victoria expected to persist, impacting settlements and margins.