OCA - Oceania Healthcare

[Basil]

https://api.nzx.com/public/announcement/458810/attachment/452155/458810-452155.pdf

Lots of talk about strengthening sales teams but very modest results.

Radically lowering the build rate in future years will really eat into development profits...(not something they mention anywhere in this presentation).

Stripping out costs...the mind boggles...what have they been doing for the last 8 years not running the business efficiently ?

There's something in this presentation for everyone.    There's no foreseeable dividend coming for many many years that I can see as 40-60% of negative cash flow is nothing.

Great they have a new 6 year plan to FY31.  Wonder what happened to the previous 6 year plan when they listed that was supposed to lead to a point of inflection with earnings ?

Any change to the Retirement Villages Act that forces companies to buy-back units from a departing resident within a prescribed timeframe, would really hurt the sector and OCA, by far the worst with their very slow selling care suites.

I expect OCA to continue to limp along earning similar EPS in future years as they did last year.  No growth 7.5 cps x 8.5 = 64 cents.    OCA will continue to disappoint investors in the years ahead with a lack of growth in underlying EPS...mark my words.

Others will no doubt have a very different view and that's fine.

[Greekwatchdog]

For Bars Review. They see no divvie until 2028 earliest

Oceania Healthcare's (OCA) 2025 investor day focused on transparency, sales execution, and cash discipline. That said, the handful of numbers provided were only average: enough to underpin the recent modest recovery in the share price, but not enough to create a real buzz on the day. All in all, we view the day as acceptable rather than exceptional. The positive is that sales applications have improved dramatically—what OCA has changed appears to be working—but we will likely have to wait until its FY26 result to see this reflected in reported sales growth. The slight disappointment is the lack of new cost initiatives and a continued stubborn focus on returning to growth—something we think OCA is years away from having earned the trust of investors to do. The glass-half-full view is that we have likely seen the trough in sales and the peak in both net debt and like-for-like opex. The slow recovery continues, with the potential to accelerate in 2H26. OCA is cash-generative and trades at <0.5x book value. We retain OUTPERFORM with an unchanged target price of NZ$0.84.

Sales have troughed ...


OCA's sales outlook was positive. It guided to ~+5% year-on-year growth in occupational rights agreement (ORA) sales for 1H26, broadly in line with our expectations. The more encouraging sign is that sales applications are up nearly ~+60% year-on-year in 1H26 and improved month-on-month in the period. Conversion of applications to sales is, if anything, improving slightly, suggesting a potentially strong sales recovery in 2H26/1H27. To reach our FY26 forecasts, OCA would need total ORA sales to grow ~+22% year-on-year in 2H26—achievable, in our view, in light of the sales applications. We leave our forecasts unchanged. Its update on its flagship development, The Helier, was slightly disappointing but is edging towards critical mass. Roughly seven additional units have sold since May 2025—just below the 'one every two weeks' guidance and shy of our hopes. At ~50% occupancy, however, we believe the development has reached critical mass, helped by a pricing reset and improved marketing.

... while net debt and costs have peaked


OCA guided to 100–150 units to be delivered in FY27, well ahead of our ~60-unit estimate. This higher build rate explains its medium-term gearing target of 30%–35% (versus our ~25% estimate). OCA is clearly planning to continue to build and even add to the landbank. This is not in line with our forecasts and will slow its reduction in absolute net debt. We do not expect OCA to proceed with these developments unless its current high level of applications converts into sales and runs down its unsold inventory. The return to prioritising new development and the prospect of unimputed dividends (likely from FY27/FY28)—while no consideration appears to have been given to buying back shares at <0.5x book value—is confusing.
Unlike its FY25 result, no new cost-out plan was announced. This was disappointing, though OCA reiterated the ~NZ$20m in annualised savings already in execution, with the full run-rate benefit to show in FY27. The programme appears on track, and investors were left with the impression that there could be more to come—just not announced at this stage.

[Mos]

Thanks for sharing Forbar's view GWD. Below is perspective from Craig's. Personally I would rather have buybacks and more aggressive portfolio streamlining. Seems like more of the the same glacial progress. Is anyone else irrationally irritated by the unnecessary corporate jargon "sales cadence" when they are just talking about sales?

Craig's on OCA...

OCA – STOP PRESS - OCA's investor day yesterday highlighted the following (i) sales momentum improved over July/August and is set to continue in September, which may partly reflect changes to marketing approach (more localised) and also price cuts where needed (ii) the company is on track to reduce costs by c.$20m (Ridgewell notes this is a net figure) (iii) the company plans to develop 100-150 units per year. The Development plans caused the most debate in the Q&A session, given the mixed success OCA has had with developments in the past, high debt levels, and the lack of detail provided by management to support the case to grow organically via development relative to other uses of capital (debt repayment, buybacks, M&A, and eventually dividends). Moreover, an intent to continue developing means the business will continue to carry a lot of debt medium term, rather than pay it down as has been central to the bull case espoused by other commentators (we estimate c.$500-550m, down only modestly from current levels ($636m) notwithstanding divestment of c.$50m of older villages, including c.$225m of core debt and c.$200-300m of unsold stock assuming a <2 year average sell down). Management was optimistic that the company would be in a position to resume dividend payments in FY27 or FY28 as it returned to positive adjusted FCF. Overall, we think there have been some positive changes to OCA's execution under new CEO Suzanne Dvorak and welcome the improved operating momentum, but we question whether the commitment to greenfield development makes sense – with M&A (either as acquiror or acquiree) likely to deliver scale (and hence higher free cash yields) faster than organic growth. Ridgewell rates OCA as Neutral.

[Basil]

Is anyone else irrationally irritated by the unnecessary corporate jargon "sales cadence" when they are just talking about sales?

My view is management went out of their way to use corporate's jargon to obfuscate as much as possible.  Count how many times the word cadence was used in the presentation    Obfuscation is something new for OCA (sarcasm)

Ridgewell has the best handle of any analyst on this company in my opinion.  Its telling that he rates it only neutral when its trading well south of 50% of NTA.

How difficult is it for the board and management to understand that instead of building new units at current construction costs and then waiting for 2 years to sell them,, (which may or may not be eventually slightly value accretive to shareholders), you can buy your own shares back at only 45 cents on the dollar and get an instant value accretion of 122% (100/45) for shareholders ?

That would be EPS accretive unlike their previous claims that other village acquisitions would be.  Why can't management and the board who are supposed to be acting in shareholders best interests see this ?  Surely not because they're greedy self serving pigs with their snouts in the trough looking for ever increasing annual payments because of the expanding asset base of this "growth" company...

My view is that board changes need to happen.  A proactive CFO who is shareholder focused is also badly needed.  Without these changes this very poorly managed and governed lame duck will just keep waddling along at a glacial pace.  I might buy a few shares and do some serious barking at the next annual meeting.  Unless there's major changes this is only ever going to be a trading stock, buy in the 50's and sell in the 70's.

[ValueNZ]

I might buy a few shares and do some serious barking at the next annual meeting.

Do it.

I'll be there as well.

[Ferg]

My view is management went out of their way to use corporate's jargon to obfuscate as much as possible.  Count how many times the word cadence was used in the presentation    Obfuscation is something new for OCA (sarcasm)

I ran their presentation through Grok, asking for it's opinion but to also look at "buzz phrases"...I did the same to the KMD presentation.  I think "cadence" comes up 6 times, whereas "capital management" comes up a staggering 30 times!  Kind of puts Forbars comment about share buybacks into perspective (also a shout out to ValueNZ who agitated for a buyback, at least one of the analysts is now talking about it).

Here is Grok's view on the OCA presentation:

### High-Level Overview of OCA Investor Day 2025 Presentation

Oceania Healthcare Limited (OCA, listed on NZX since 2017 IPO) is a leading New Zealand provider of aged care and retirement village services, operating 36 sites as of August 31, 2025 (down from 48 at IPO through strategic divestments). The portfolio includes ~1,190 traditional care beds, ~1,123 premium care suites, ~813 villas, and ~1,059 apartments, with ~95% care occupancy at unaffected villages and ~2,600 employees. Focused on modern, integrated sites, OCA emphasizes care as its foundation while expanding independent living units (ILUs).

The 63-page Investor Day presentation (September 16, 2025) introduces a refreshed executive team under CEO Suzanne Dvorak (appointed 2024), highlighting market tailwinds like senior population growth (projected 75+ population doubling to 1.4M by 2078) and ILU undersupply (~115 villages by 2048). It addresses challenges such as economic pressures, regulatory reforms, workforce cycles, and housing market softness (e.g., median days to sell at 48 in July 2025).

The "Supporting and Empowering People to Live Well as They Age" strategy balances near-term priorities (FY25-27: sales performance via targeted campaigns/pricing; business excellence with $20.4M annualized savings; capital management targeting 30-35% gearing via stock sell-down/divestments) and long-term objectives (FY27-31: Customer Choice for high NPS/occupancy; Service Expansion via lifestyle pilots; Future Development with ~1,000-unit landbank at 100-150 annual build rate). Aims for YOY free cash flow/earnings growth, regular dividends (40-60% FCF), and resilience through tech, sustainability, and culture.

Overall, OCA positions itself as undervalued with a resilient, care-led model poised for sustainable growth, targeting debt reduction (~$342M from unsold stock/divestments), operational efficiencies, and market share in high-demand regions.

### Buzz Phrase Analysis

To measure buzz phrases (vague/aspirational/overused terms as defined earlier, e.g., "strategic," "leverage," "cadence," "intelligent" combos, plus hybrids like "financial guardrails"), I scanned the full document text (~6,795 words, excluding numbers/symbols/repetitive headers). This identified 190 instances, for an incidence rate of ~2.8% (about 1 in 36 words).

#### Top Buzz Phrases and Counts
Concentrated in strategy sections (e.g., pages 5-11, 32-60), where motivational language peaks. Examples include:

| Buzz Phrase                  | Count | Example Context |
|------------------------------|-------|-----------------|
| capital management          | 30    | Repeated in "capital management framework" and priorities. |
| service expansion            | 28    | Core objective (e.g., "Service Expansion: unlocking new revenue streams"). |
| customer choice              | 27    | Pillar like "Customer Choice: what consumers want." |
| business excellence          | 27    | Priority area (e.g., "Business Excellence: optimisation embedded"). |
| future development          | 24    | Objective (e.g., "Future Development: landbank of ~1,000 units"). |
| strategic                    | 16    | In "strategic expansion," "strategic framework." |
| sustainable growth          | 7    | Theme (e.g., "Sustainable growth, disciplined execution"). |
| disciplined execution        | 6    | Repeated in summaries (e.g., "Disciplined execution today"). |
| cadence                      | 6    | In "sales cadence improvements," "application cadence." |
| high performing              | 3    | E.g., "high performing sites," "high performing workforce." |
| year on year growth          | 3    | In "Year on Year growth in free cash flow." |
| leverage                    | 2    | E.g., "leverage brownfield expertise." |
| scalable                    | 1    | In "more scalable systems." |
| customer-centric growth      | 1    | Exec bio: "customer-centric growth." |
| leveraging data insights    | 1    | Exec bio: "leveraging data insights to drive performance." |
| change management            | 1    | Exec bio: "change management." |
| next phase of growth        | 1    | In "team driving our next phase of growth." |
| empowered people            | 1    | Pillar: "Empowered People." |
| purposeful impact            | 1    | Pillar: "Purposeful Impact." |
| connected care              | 1    | Initiative: "Connected Care." |
| seamless care                | 2    | In "seamless care and trusted relationships." |
| inspired living              | 1    | Initiative: "Inspired Living." |

Added phrases fit the "nice words with little chance" criteria, e.g., "sustainable growth" sounds aspirational but ties to specifics like savings/divestments. "Intelligent" combos not found, but "data driven" (implied in "data driven targeting") could qualify if expanded.

#### Rating on the Scale: Grounded in Reality vs. Full of Hot Air
On a 1-10 scale (1 = fully grounded, 10 = pure hot air), a **5**—balanced, similar to KMD, leaning grounded with specifics backing the flair.

- **Grounded elements**: Anchored in metrics (e.g., $20.4M savings, 30-35% gearing, 100-150 build rate, NPS >70), timelines (FY26 pilots, FY27-31 objectives), and actions (e.g., divest 4-6 sites for $50M, pilots at 3 sites). Market data (demographics, undersupply) and case studies (Eversley EBITDA $23k/bed) add credibility.
- **Hot air lean**: Repetitive aspirational terms like "sustainable growth" (7x), "disciplined execution" (6x) add polish but risk vagueness without full execution. Density (2.8%) is moderate for investor decks, clustered in strategy overviews.

Typical for sector presentations: Buzz motivates, but numbers (e.g., landbank ~1,000 units, debt reductions) make it credible. If you'd like to scan more phrases or focus sections, let me know!

[Basil]

Do it.

I'll be there as well.

It might be tempting if it gets down into the 50's.  More for the opportunity to really rip into management and the board than for the profit though.  You're doing a great job with shareholder activism so far.  Give yourself a pat on the back mate.

Interesting, thanks Ferg.  Of course any assessment of this latest investor presentation needs to be viewed in the light of the almost endless stream of obfuscation and creative corporate B.S. speak that's emanated from management and the board in the past.  I'm sure you have noticed that they never ever mention earnings per share unless its to lie about an acquisition they want to fund from shareholders being EPS accretive.  That's literally the only time you hear EPS mentioned in any management commentary or report..  They're of course happy to wax lyrical about the fantastic growth in their assets to justify their egregiously generous increases in salaries.  (CEO and CFO salaries have more than doubled since this listed more than 8 years ago while earnings per share have reduced and dividends cut to zero for years)  You'd be easily forgiven for thinking they couldn't care less about shareholders and are running this company entirely for their own benefit.

[Greekwatchdog]

For Bar update

Oceania Healthcare's (OCA) ongoing portfolio transformation is yet to deliver meaningful improvements in annuity earnings or cash generation, despite significant growth in its total asset base. That said, there are encouraging reasons to believe we are finally approaching an inflection point: (1) sales application momentum is improving; (2) ~NZ$20m of cost-out benefits will be largely realised in FY27; and (3) OCA's care suite portfolio is well positioned for NZ's widening care supply–demand imbalance. OCA has laid the groundwork to lead the sector in generating sustainable free cash flow from operations. Under new leadership, it must prove it can deliver on this foundation. While execution risk remains, we continue to see upside and we reiterate our OUTPERFORM rating with an increased target price of NZ$1.00

What's changed?
Earnings: Annuity EPS rises +32%/+1%/+2% over FY26/FY27/FY28 on higher DMF and modestly lower opex.
Target price: Increased to NZ$1.00 on earnings changes and the incorporation of a discounted cash flow (DCF) valuation.
OCA's asset growth has not translated to financial performance historically
Despite a near doubling of its independent living unit (ILU) footprint from ~1,050 units in FY17 to ~2,000 units today, OCA has failed to deliver growth in either: (1) our annuity EPS metric; or (2) free cash flow from ongoing operations. Village revenue (excluding resales) increased ~+75% over this period, while village opex and head office/ support costs rose +160% and +115% respectively. We expect an improvement in these trends with time.

Improving sales momentum and cost-out programmes underpin our belief in an inflection point
OCA's total sales applications through the first five months of 1H26 were +58% ahead of the comparable period in 1H25, with sequential monthly improvements from April through to August. Strong application momentum bodes well for settlements in 2H26 and into FY27, supporting the sell-down of unsold stock and improved village occupancy. Together with ~NZ$20m of annualised cost savings to be largely realised in FY27, these trends underpin our view that OCA's earnings are nearing an inflection point.

Care portfolio well positioned to benefit from intensifying demand pressures
OCA has NZ's largest portfolio of care suites (~850) sold under an occupational rights agreement (ORA). While the economically sound rationale behind care suites is yet to manifest in tangible improvements in care returns, a deterioration in core care margins over the last five years has obscured strong growth in ORA-related revenue. With cost pressures subsiding and occupancy rising across the sector, we expect these premium revenue streams to drive a material improvement in care profitability going forward.

Earnings revisions
We make relatively modest changes to our near-term earnings estimates, with higher DMF and marginally lower opex partially offset by lower resales gains. Our annuity earnings increase +32%, +1%, and +2% across FY26, FY27 and FY28 respectively. We also increase our build rate to align with the midpoint of OCA's medium-term guidance range of 100 to 150 units delivered per year, which leads to lower free cash flow and higher net debt from FY27.

Valuation (Dividend discount model [DDM] swapped out for DCF)
We have adjusted our valuation methodology to include a DCF (replacing our DDM). Our new target price of NZ$1.00 is based on a DCF valuation of NZ$0.90 and an annuity PE valuation of NZ$1.05, weighted evenly. Our DCF uses a weighted average cost of capital (WACC) of 9.1% and a terminal growth rate of 1.5%.

[Greekwatchdog]

For Bars Preview of half year result

Oceania Healthcare (OCA) will report its 1H26 result on Friday, 21 November. We expect a solid improvement in annuity earnings, with strength in sales applications from April to August 2025 providing a strong platform for further growth in 2H26. Our key focus areas will be: (1) whether sales application momentum has continued following OCA's investor day update on 15 September 2025; (2) inventory levels and net debt; (3) progress with cost-out initiatives; and (4) care profitability. OCA is trading at ~0.5x NTA. For the market to reduce this discount going forward, the 1H26 result must demonstrate a clear pathway towards durable free cashflow generation.

Key points of interest

Sales progress: We forecast 270 total unit sales for 1H26, +5% ahead of 1H25 and at the midpoint of OCA's guidance (265 to 275 units) provided at its September investor day. We look for signs strong application momentum in 1H26 (total applications were +58% ahead of 1H25 through the first five months) is continuing and/or beginning to translate into settlements.

Inventory: OCA reported NZ$392m of unsold stock at its FY25 result in May, including NZ$342m of new sales stock. We expect inventory levels to fall during 1H26, with minimal new deliveries and management focused on clearing aged stock.

Balance sheet/net debt: OCA should report a reduction in net debt (FB: -NZ$33m) for the third consecutive half in 1H26, underpinned by positive development free cashflow (FB: +NZ$39m). Any updates on OCA's flagged divestment programme (four to six sites to be sold, releasing NZ$30m to NZ$50m of capital) will be of interest.

Cost out: We expect another nominal reduction in total opex in 1H26, with ~NZ$20m of annualised cost out underway.

[850man]

21/11/2025, 08:30 NZDT, HALFYR
Momentum Building on Stronger Foundations

Oceania Healthcare (NZX:OCA) has delivered a much improved result for the six months ended 30 September 2025, reflecting disciplined execution and sustained momentum across its strategic priorities of sales performance, business excellence, and capital management. Improved sales conversion, cost efficiencies, and a sharper focus on working capital have strengthened operating cash flow. Gearing has reduced to within target range and the business is well positioned for further sustainable improvement in the second half.

Financial and Operating Highlights1

• Total Comprehensive Income: $40.4 million, up $28.6m on 1HY25
• Reported NPAT: $4.9m, compared to a loss ($17.1 million) in 1HY25
• Proforma Underlying EBITDA2: $41.8 million, up 19.7% on 1HY25
• Proforma Underlying NPAT2: $24.1 million, up 18.9% on 1HY25
• Free Cash Flow from Operations: $(8.4) million, 30.0% improvement from 1HY25
• Annualised cost savings: $20.4 million identified, with $4.0 million delivered in 1HY26 and on track to deliver $13.2m in FY26
• Care EBITDA per bed: up 45.5% to $12.4k, reflecting a renewed and disciplined approach to operational excellence and strong sales of care suites
• Total assets: increased to $3.0 billion, up 3.3% on FY25
• Net tangible assets: $1.57 per share, a 3.8% increase on FY25
• Gearing: 34.8%, down 1.5 percentage points from March 2025 and within the target range of 30 – 35%

1 All balances have been extracted from the 30 September 2025 interim financial statements and are unaudited.

2 Underlying NPAT and Underlying EBITDA are non-GAAP measures of financial performance. The calculation of Underlying NPAT and Underlying EBITDA requires a number of estimates to be approved by the Directors in their preparation. Both the methodology and the estimates may differ among companies in the retirement village sector. A reconciliation of Reported NPAT to Underlying NPAT and Underlying EBITDA is included in Note 2.1 of the Interim Report. Proforma Underlying NPAT and Proforma Underlying EBITDA are adjusted for the impact of the closure of the Wesley Institute of Nursing Education in April 2025. A reconciliation of Underlying NPAT and Underlying EBITDA to Proforma NPAT and Proforma EBITDA is included on page 9 of the Interim Report.

Sales performance

Sales performance strengthened through the period, underpinned by targeted initiatives to improve conversion rates and reduce unsold stock. Total sales volumes rose 5.0% to 271 units, reflecting broad based momentum across the portfolio. Sustained demand for care suites delivered 161 sales in line with the prior period. Independent living unit sales improved, rising 13.4% to 110 units. At The Helier, in Auckland, sales continue to improve, with 54.5% of residences either occupied or under application as at 20 November 2025 and targeting full cash recovery, including interest, by 31 March 2026. Enquiry and conversion levels continue to build, reflecting growing market recognition of The Helier's full range of living options combined with its premium resident experience.

At Franklin, in Auckland, presales continued to build strongly, with 11 villa sales secured to date ahead of completion. Construction remains on schedule, with 31 independent living units set to welcome their first residents in January 2026.

Suzanne Dvorak CEO said "The early sales success at our Franklin development reflects the growing strength of Oceania's sales capability, with product design, pricing, and location increasingly aligned to customer demand. The project illustrates the effectiveness of Oceania's disciplined approach to development."

Financial Performance

Total Comprehensive Income was $40.4m, up $28.6m, reflecting the initial positive impacts of the cost out programme and the impact of fair value gains. Operating Cash Flow increased to $79.0 million, up 12.2% compared to $70.4m in 1HY25. This was driven by higher cash receipts from occupation right agreements (ORAs), up 3.2% on the prior corresponding period, supported by lower payments to suppliers and employees, down 3.8% on the prior corresponding period. The care segment recorded a 40% increase in underlying EBITDA compared with the prior period, supported by enhanced clinical systems, digital workflow tools, and refined acuity management. Annualised care EBITDA per bed, excluding resale gains, rose to $12.4k, up 45.5%, with more than half of the portfolio generating over $15.0k per bed per annum.

Proforma Underlying EBITDA was $41.8m for the 6 months ended 30 September 2025. This included total capital gains of $38.4m, an increase of $0.2m on the previous year.

Gearing reduced to 34.8%, down from 36.3% at 31 March 2025, leaving undrawn net debt headroom of $116.1m at 30 September 2025 as planned.

Interim Dividend

The Board announced a new dividend policy in June 2025 to align with operating cashflows and targeting a payout ratio of between 40 and 60% of Free Cashflow from Operations, subject to capital requirements and investment opportunities.

Chair, Liz Coutts advises that "The Board has decided not to declare an interim dividend for 1HY26, in line with the policy. Dividend payments are expected to resume when the business achieves positive free cash flow from operations, supporting a return to payment of dividends."

Strategy and Outlook

Oceania Healthcare's strategic direction is clear and in motion. In September, the company hosted a well-attended Investor Day for institutional investors and equity analysts.

The near-term priorities of Sales Performance, Business Excellence, and Capital Management outlined on the day are being executed with discipline.

Mrs Coutts said "Oceania is first strengthening its foundations to position the business for its next phase of growth. The longer-term strategic horizon (FY27–FY31) will build on these foundations, focusing on customer choice, service expansion, and future development."

Oceania's land bank and operational footprint provide significant optionality, and development activity will continue to be paced to align with market conditions and capital availability. The company is taking a disciplined approach to growth, building only when and where conditions are right. It will build towards its target of 100-150 units per year over the near term.

For the remainder of FY26, the focus is on executing these foundations with precision. Increasing sales cadence and reducing debt remain central to this effort. Key operational priorities include:

• strong sales at The Helier, targeting full recovery of development costs by March 2026;
• completing Stage One at Franklin with increasing presales (currently at 35.5%);
• further improving care profitability;
• implementing $20.4 million in annualised cost-out initiatives from FY27;
• completing four planned divestments targeting ~$40 million in capital release;
• delivering significant debt reduction to maintain gearing within the targeted range of 30 – 35%; and
• returning to positive free cash flow from operations and resuming the payment of dividends.

Ms Dvorak said: "We have acted quickly and decisively as a leadership team. The progress over this focused period of execution ensures Oceania enters the next stage of its strategy with stronger cash generation, a leaner cost base, and the balance sheet strength to pursue disciplined, value-accretive growth. Oceania enters 2HY26 with significantly improved sales, financial, and operational momentum.

We said we'd strengthen sales, improve operational efficiency, and reduce debt. We're delivering on all three. That disciplined execution gives us confidence as we move into the second half and beyond."

[Basil]

Cool how senior management's salaries have more than doubled since the IPO but shareholders get nothing year after year.

Market not happy 

[Mos]

Groundhog Day again. Slow progress dressed up as knocking the lights out. Being a holder of Oceania requires the patience of a saint; like driving behind a campervan over the Lindis Pass while being forced to listen to them talk about their performance like they are Max Verstappen coming through the field for the win. The excessive gilding the lily does them a disservice - a bit more humility, reality and Mainfreight style straight talking would be more credible.

Positives
- Improving care profitability trends finally
- Focus and some traction on the $20 m cost reduction target
- Reducing debt
- Slow progress but some progress on The Helier sell down
- Decent initial pre sales for Franklin stage 1 (much better than The Helier)
- Continued focus on selling down properties that don't create value and detract from brand consistency. If they get the 4 villages away for ~$40m that will be a good step forward and I reckon there are another 10-12 villages that don't fit and I suspect they will sell over the next 3 years or so
- Very low cost of debt until at least 27/28
- Ryman DMF and weekly fees hike facilitating a better competitive environment

Negatives
- How they can describe sales performance as strong at the start of the presentation I don't know, later in the presso they more realistically describe both resales and new sales as steady - will take a long time to unwind the excess stock position at this rate
- Free cash flow from operations negative -$8.4m
- Taking a long time to streamline to the portfolio
- Lack of Board/Management interest in buy back at 50% of NTA is baffling and frustrating. Suggests they either don't care about creating shareholder value efficiently and/or they actually believe the value of the business is around 50% of NTA. Hopefully the institutions and brokers will change the Board's mindset on this but based on track record not holding my breath
- Stale Board that have overseen years of drift

Value
- With strong sales execution, effective cost management, continuing to improve care profitability, delivering on portfolio streamlining, a buy back programme - it has the potential to close the gap to NTA over the next 2-5 years in my view
- With more of the same including continued slow sales and no buy back it is hard to see a catalyst for much of a rerate

Disclosure
- Hold at 3% of portfolio but not adding at this price until they start kicking some goals

[Shareguy]

Craigs not impressed

uNPAT of $23.8m is in-line with the pcp and tracking below consensus for FY26 uNPAT of $62.2m or +19% YoY. 1H26 uEBITDA increased 8% YoY to $41.5m but tracking 21% below consensus for $111.35m (+29% YoY) for the full year. Normalising for the impact of divesting sites from their ongoing operations and the closure of the Institute of Nursing Education in April 2025, proforma uEBITDA for 1H26 was $41.8m, +19.7% on 1H25. This included total capital gains of $38.4m, an increase of $0.2m YoY.
Operating cash inflows of $79m increased 12% YoY, driven by higher cash receipts from occupation right agreements (ORAs), up +3.2% on pcp, supported by lower payments to suppliers and employees, down -3.8% on the prior corresponding period. Investing cash outflows fell 30% YoY to $59.5m.
Net debt fell 3% HoH to $608.9m (107% of FY26 consensus for $569.6m and 102% of CIPe consensus for FY26). Gearing eased slight to 34.8% (from 36.3%) and is within OCA's targeted gearing range of 30-35%.
Free cash flow from operations remains negative at -$8.4m, a 30% improvement from -$12.0 at 1H25 but still disappointing. 

[winner (n)]

Mos said "Stale Board that have overseen years of drift"

Datamine have a Board Scorecad. Ranked about 80 directors based on the performance of the companies hey are involved in.

Oceania Director rankings are

Coutts. 7th
Isaac. 11th
Hamilton. 57nd
Tomlinson. 65th

Seems Coutts is high through her involvement with Ebos. Isaac involved with Scales and Z Skellerup helps him.

Maybe your staleness is from Tomlinson and Hamilton

Prendergast et al don't get ranked as only on one Board but I'd say Prendergast is a lame duck anyway

[ValueNZ]

they actually believe the value of the business is around 50% of NTA.

Great post. But I would suggest that they know the business is undervalued, for most/all their average price paid per share sits well north of the current share price.

Why they don't repurchase the shares, maybe it's a lack of understanding of how a share buyback works? Or they don't want to rock the boat and do something outside of the industry norm.

Maybe they are afraid if they implement it now all of the shareholders will be questioning why they didn't do it years ago?

It might also be a case of empire building.