OCA - Oceania Healthcare

[winner (n)]

Great post Winner, agree 100%.
All in this sector have now announced a review of their build rate going forward except OCA.

After the RYM capital raise, assuming punters back current management to support RYM, OCA moves to the top spot in the sector in terms of having  the highest gearing.

They will be extremely keen to liquidate their 10 lame duck villages with no development potential but who on earth is going to be the buyer for those lemons in this market?

Carrying value is approx $60m but the real value, if there is one at all, is likely to only be a fraction of that.

 In analyst/media commentary on RYM fiasco is a lot of chatter of how Ryman haven't been disclosing a few things ....like a lack of total transparency. Even the cap raise documents leave out detail that investors should know about.

To me Oceania always seem rather 'vague' on detail and how they keep changing how they report things is not a good sign. I sometimes wonder what is it they don't want the market/investors to know about.

That's my opinion but I reckon they can't go on burning cash without a decent capital raise soon. Results announcement in May will be interesting.

[Waltzing]

Must say winner() charting is very professional and i think he worked at solomen bros in the late 80's ear; 90 in the Mortgage bond department as they were into anything that raced on a track... they were the big  gamblers on wall street...

who hasnt got the book https://en.wikipedia.org/wiki/Liar%27s_Poker.... of course have lost it and its not under a computer ... we have a lot fo computer with book under them....

if you want to see where the GFC started it started in NY in the 80's

someone explain how small boxs of wood on tiny sections can sell for 900g's in small town NZ,

[Basil]

In analyst/media commentary on RYM fiasco is a lot of chatter of how Ryman haven't been disclosing a few things ....like a lack of total transparency. Even the cap raise documents leave out detail that investors should know about.

To me Oceania always seem rather 'vague' on detail and how they keep changing how they report things is not a good sign. I sometimes wonder what is it they don't want the market/investors to know about.

That's my opinion but I reckon they can't go on burning cash without a decent capital raise soon. Results announcement in May will be interesting.

Agree. OCA management are very skilled at obfuscation. 

You've got to have a bit of a chuckle about companies who raise debt to ostensibly pay unimputed dividends. With a third of it going to the Goverment.  Nice to see them paying some tax even if it's in a roundabout way with shareholders doing it for them.

[Waltzing]

Oh Dear Dear  ...... something rotten in the state of ....

[winner (n)]

Couldn't kelp but notice that there's even a pecking order when it comes to listed bonds

Could say higher the rate higher perceived 'risk'

Rates as per NZDX

OCA 7.23% / 7.25%
ARV 6.79%
RYM 6.25%
SUM 6.23% / 6.30%

And Metlife 6.47%

Spooky

[Basil]

Those yields for OCA pretty much in line with Synlait.  Seems about right, both have a lot to prove and a long track record of ostensibly no growth despite high debt

[winner (n)]

Jenny Ruth BusinessDesk did a piece on retirement sector cash flows and quoted Decker from Jardens a lot -main point being Underlying Profit is not a good measure of cash flow and companies should be using AFFO (– adjusted funds from operations).

Piece in the article quoting Decker - "Ryman has produced $33m of Jarden Affo over the past five years versus over $1b of underlying profit and $539m of cash dividends,"

Pretty damning

My workings seem to indicate that Oceania has produced negative AFFO the last few years .... and still pays dividends

I wonder how Oceania will be presenting cash flow in results announcement ... spotlight has been on Ryman and Summerset showed some initiative in presenting their steady state cash flow (positive)

[Waltzing]

New policy from the "Blue boys" , (who at the moment would be red , color of death).

This could help everyone from COMP props to This sector.

And from the incredible rich business information selection on STUFFED!

https://www.stuff.co.nz/national/politics/131454239/national-unveils-buildtorent-policy-it-says-will-help-solve--housing-crisis

https://en.wikipedia.org/wiki/The_Blue_Boy

[Untamed]

Simplicity had this vision long before National did, and has rentals about to go to market in April.

"Our first rental homes are opening in April

We're putting the finishing touches on our very first Simplicity Living development - Kupenga Apartments in Point England, Auckland.

Bringing to market a range of one, two and three-bedroom apartments, these 59 modern, quality homes will be available to rent on a long-term basis (no fixed term contracts).

One-bedroom apartments start from $415 per week, and viewings will start in early April"/I]

https://simplicityliving.kiwi

New policy from the "Blue boys" , (who at the moment would be red , color of death).

This could help everyone from COMP props to This sector.

https://www.stuff.co.nz/national/politics/131454239/national-unveils-buildtorent-policy-it-says-will-help-solve--housing-crisis

https://en.wikipedia.org/wiki/The_Blue_Boy

[winner (n)]

Brent will be happy with what's going on in property market

Sales numbers in February up nearly 40% on last year

Theres a lesser rate of decline in annual median prices and sales counts

And great news Auckland saw a 7.0% increase in median house price  tipping back over the $1 million price point.

Looking forward to great OCA result in May

What REINZ said https://www.reinz.co.nz/Web/Web/News/News-Articles/Market-updates/reinz_february_data_2023.aspx?name=reinz_february_data_2023

[Breezy]

Brent will be happy with what's going on in property market

Sales numbers in February up nearly 40% on last year

Theres a lesser rate of decline in annual median prices and sales counts

And great news Auckland saw a 7.0% increase in median house price  tipping back over the $1 million price point.

Looking forward to great OCA result in May

What REINZ said https://www.reinz.co.nz/Web/Web/News/News-Articles/Market-updates/reinz_february_data_2023.aspx?name=reinz_february_data_2023

Not bashing the company today, thats refreshing.

[winner (n)]

Not bashing the company today, thats refreshing.

And OCA near top of NZX leaderboard at the moment

That's good

[Basil]

Brent will be happy with what's going on in property market

Sales numbers in February up nearly 40% on last year

Theres a lesser rate of decline in annual median prices and sales counts

And great news Auckland saw a 7.0% increase in median house price  tipping back over the $1 million price point.

Looking forward to great OCA result in May

What REINZ said https://www.reinz.co.nz/Web/Web/News/News-Articles/Market-updates/reinz_february_data_2023.aspx?name=reinz_february_data_2023

Objectively the ~ 40% increase in sales volumes for February year on year was very surprising considering the atrocious weather that month.  Probably many of those contracts were signed in January when the weather was much better and went unconditional in February and we'll see the backwash effect of the incredibly bad weather flow through to the volume of March contracts going unconditional.

Plenty of anecdotal evidence the cost pressures with care are still hugely problematic.  How I see it is when the market leader (Ryman) waves the white flag and says they have to seriously reduce the level of care in new developments going forward, after all this time with their stellar reputation in care and the risk to their reputation going forward in doing so, you know they honestly believe issues around costs run very deep indeed and are not going away in the future.

There's enough evidence with a very soft real estate market, extreme weather slowing down developments and deeply ingrained massive systemic issues with human resource cost to come to the conclusion that OCA (with the vast majority of their business model involved with care), will report another very disappointing result in May.  How long before caregivers and nurses want the same 15-25% increases their Australian counterparts are after?

I think the outlook for FY24 is also very subdued and they have little or no chance of selling the ten care villages they want to exit anywhere near book value.  Just keep building more and more care suites that are not selling well with more and more debt, what could possibly go wrong 😉

[Untamed]

You could of course be right. Or maybe Ryman simply doesn't have the insight OCA does into the potential market for care. OCA has always appeared to me, to be much more in touch with the realities of the aged care situation in this country, than other providers have been. Their Care Suites are a prime example, with their provision of continuity of care in the same suite, with care support increasing as needed over the life of the occupant(s). There is money to be made from care, even standard bed subsidised care, if one has the tenacity and patience to anticipate future needs and the inevitable changes to funding, plan ahead for future scenarios, and be ready to take advantage of them down the track.

My money is on OCA as the provide most likely to achieve that.

Plenty of anecdotal evidence the cost pressure with care are still hugely problematic.  How I see it is when the market leader (Ryman) waves the white flag and says its too hard, after all this time with their stellar reputation in care and the risk to their reputation going forward in doing so, you know the issues around the cost of providing care run very deep indeed and are incapable of resolution.

[Breezy]

Objectively the ~ 40% increase in sales volumes for February year on year was very surprising considering the atrocious weather that month.  Probably many of those contracts were signed in January when the weather was much better and went unconditional in February and we'll see the backwash effect of the incredibly bad weather flow through to the volume of March contracts going unconditional.

Plenty of anecdotal evidence the cost pressures with care are still hugely problematic.  How I see it is when the market leader (Ryman) waves the white flag and says they have to seriously reduce the level of care in new developments going forward, after all this time with their stellar reputation in care and the risk to their reputation going forward in doing so, you know they honestly believe issues around costs run very deep indeed and are not going away in the future.

There's enough evidence with a very soft real estate market, extreme weather slowing down developments and deeply ingrained massive systemic issues with human resource cost to come to the conclusion that OCA (with the vast majority of their business model involved with care), will report another very disappointing result in May.  How long before caregivers and nurses want the same 15-25% increases their Australian counterparts are after?

I think the outlook for FY24 is also very subdued and they have little or no chance of selling the ten care villages they want to exit anywhere near book value.  Just keep building more and more care suites that are not selling well with more and more debt, what could possibly go wrong 😉

Isn't this the same regurgitated rhetoric we have been hearing from you since you fell out of love with this stock? Actually i can't remember exactly how many broken relationships you have had with this bride?