Metlifecare keen to boost share price

AUCKLAND: Metlifecare is considering ways to boost its share price, including a potential buyback, chairman Kim Ellis says.

The shares recently traded at $5.98, down from a peak of $6.51 in September, at a sizeable discount to their net asset value of $6.93.

Mr Ellis told shareholders at this week’s annual meeting the board had a strong belief in the longterm value of Metlifecare’s portfolio and land bank, and the discount had been an ongoing frustration. The board was considering ways to bridge that gap and would update shareholders of any decision at the firsthalf result in February.

‘‘There are a number of initiatives that we could take to try and narrow the gap, such as a possible share buyback and diversification of the share register to assist with creating mar ginal buying support,’’ he said.

Metlifecare had 4499 shareholders as at July 12, of whom 61 owned 90% of the retirement village operator. It has three substantial shareholders: the New Zealand Superannuation Fund with 19.8%, ANZ funds with 10.8%, and Investment Services Group at 6.4%.

The company has a market capitalisation of $843.8 million, just behind Summerset Group’s $1.03 billion value. Ryman

Healthcare is valued at

$4.21 billion.

Mr Ellis said the company was reviewing its debt structure, and would also update shareholders on that work at the firsthalf update.

Metlifecare’s net debt almost doubled to $138.4 million in the year ended June 30. The gearing ratio — net debt as a percentage of debt plus equity — was 9%, a level the company described as showing the ‘‘exceptional strength’’ of its balance sheet and capacity for future growth.

Chief executive Glen Sowry said the company’s accelerated growth had required the management of more projects than it had ever handled before. That pace would continue to pick up in the current year, with activity across 11 existing and new villages and 145 units and two new care homes set to be delivered before the end of June.

The following year, Metlifecare anticipated a build rate of at least 300 units, he said. It delivered 254 in the 2018 financial year.

‘‘We are still expecting to deliver higher volumes of occupation right agreements for both new homes and resales in FY19,’’ Mr Sowry said.