Rymanhealthcare sets sights on top spot Kiwis pay more for IT products
Ryman Healthcare is aiming to be the No 1 company on the NZX.
It has already moved into the top five and its market capitalisation sneaked over the $2 billion mark recently.
Last year, Ryman was one of the NZX’s best performers, with its shares rising 68 per cent.
Managing director Simon Challies said the retirement village operator’s performance, including record profit growth over the past 10 years, had attracted the attention of overseas fund managers, who had taken an increased stake in the past six to 12 months.
Challies said it was difficult to compile a total for overseas holdings as many were held by nominees.
‘‘What I can tell you is that the company is attracting a lot of interest from investment funds in Aussie and further afield.’’
The interest was also being generated by Ryman’s strong building programme.
The company, which moved its headquarters to the edge of Christchurch following the February 2011 earthquake, has a 15 per cent profit growth target.
Ryman’s share price improved further this year when it lifted its build rate to 700 retirement units and aged-care beds a year, in response to the strong demand it is experiencing for its villages.
‘‘My sense is that people have a high level of confidence in our ability to deliver,’’ Challies said.
‘‘With the growth path we’re on, we’re No 5 on the index, we’ve got our eyes on No 1.’’
Challies is talking about the company’s mainly finished Diana Isaac retirement village in Christchurch.
Sitting alongside building proj- ect foreman Donald Mackay, and village manager Jenny Thiele, Challies’ focus is on the modern facility Diana Isaac offers – up another step in terms of layout and finishes, and probably costing a bit more per square metre than some of Ryman’s other villages.
The 11-hectare property already offers 120 care beds, 80 serviced apartments and 100 townhouses, with more than 300 residents already and 150 staff.
Sales adviser Rachael Harris said there was a strong waiting list, with most residences being occupied soon after completion.
Prices for the right to occupy a two-bedroom townhouse for life ranged from $329,000 to $359,000, with residents able to sell back the property less a deferred management fee that grew to 20 per cent over the first five years. Average home prices in the area were about $400,000, Challies noted.
The red zoning of earthquakehit properties was not a huge factor in the demand for the properties, Harris said. However, the older residents had made a conscious decision to be in a more security-based community, Thiele added. The build, on a greenfields site, had been speedier than previous village constructions by Ryman.
Challies said while the company had not ruled out further villages in Christchurch, it was now more focused on North Island opportunities, with possible land purchases to be announced over the next few months.
Challies said Ryman was on the cusp of beginning earthworks for a village in Melbourne, with a start likely this month. The first stage, including the central complex, an aged-care facility and some independent living units, had a target completion date of March next year.
Established in 1984, Ryman owns 25 villages nationwide including the Ernest Rutherford Retirement Village in Stoke, which offer retirement living and aged care, and serve more than 6000 residents. Kiwis are paying a premium for some consumer technology products and software, in some cases over 40 per cent more than shoppers in the United States.
The disparities in pricing are in spite of the sustained strength of the New Zealand dollar, and even extend to software distributed online such as music and games through Apple iTunes.
The pricing of software and other consumer IT goods has prompted a parliamentary inquiry in Australia.
New Zealand Minister for Communications and Information Technology Amy Adams said she was watching the inquiry closely.
PC World editor Zara Baxter said Kiwis paid significantly more for smartphones and laptops, in particular, while other products such as tablet computers seemed more evenly priced.
New Zealand had a higher GST rate than either Australia or the US, ‘‘but there are some products where the price differential is just massive and ridiculous’’.
A Dell 18X Alienware laptop retailed for about US$1999 in the US, but cost $4699 (equivalent to US$3870 at current exchange rates) through Dell’s New Zealand website, she said.
In some cases, higher prices could partly be explained by better or different features for local markets. Manufacturers also frequently cited New Zealand’s more stringent warranty obligations un- der the Consumer Guarantees Act, which requires them to keep spare parts for repairs, for higher prices here.
Comparing prices for products between countries could be difficult, as they often had slightly different product names, particularly if they had been tweaked to suit local tastes. ‘‘Because we’re such a small market, we’re almost inevitably going to pay more than Australia and the US because we don’t have the economies of scale.’’
Vendors and telcos tried to maximise their economies of scale, to help keep costs down, by bringing in more units but fewer products, for example, but that also had the effect of reducing choice in the market.
‘‘We pay a lot in reduced choice as well as in higher prices.’’
Baxter said Kiwis also typically paid over the odds for software, such as music and apps through Apple iTunes, which were downloaded digitally and so did not incur shipping and distribution costs.
Chris O’Connell, board member and spokesman for the Telecommunications Users Association, said vendors charged what they knew they could get away with.
‘‘With products like the iPhone, where demand always exceeds supply, they know there are always people willing to pay over the odds. I know people who have flown to the US just to get new ‘i’ products.’’