New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

New Zealand Professional Investment Services Firm

We are proud to be a New Zealand owned firm, with 21 offices throughout the country and over 300 employees. We assist personal, institutional and corporate clients providing a full range of investment services.

Forsyth Barr is a foundation New Zealand Exchange firm (NZX) and accredited market participant. We have been confirmed by the Financial Markets Authority as a Qualifying Financial Entity (QFE).

Research is the cornerstone of our advice. We have one of New Zealand's leading teams of analysts. Our global affiliations ensure comprehensive research coverage of all major investment markets.

Equity Bottom-Up

Summerset Group Holdings / Equity Bottom-Up

<ul><li>We upgrade our rating on Summerset (SUM) from NEUTRAL to OUTPERFORM with an increased target price of NZ$14.30.</li><li>We expect SUM to sustain its sector-leading asset growth over the next decade, given: (1) its best-in-class development engine already delivering ~700 units per year; (2) NZ retirement village consents at the lowest level in a decade; and (3) key competitors significantly scaling back development.</li><li>With this report we transfer coverage from Aaron Ibbotson to Will Twiss.</li></ul>

We upgrade our rating on Summerset (SUM) from NEUTRAL to OUTPERFORM with an increased target price of NZ$14.30.We expect SUM to sustain its sector-leading asset growth over the next decade, given: (1) its best-in-class development engine already delivering ~700 units per year; (2) NZ retirement village consents at the lowest level in a decade; and (3) key competitors significantly scaling back development.With this report we transfer coverage from Aaron Ibbotson to Will Twiss.

Summerset Group Positive Developments—Up to OUTPERFORM

<ul><li>Summerset (SUM) reported annuity earnings down -28% year on year, its lowest since the COVID-impacted 1H20.</li><li>NTA continued to grow strongly, in contrast to peer Ryman Healthcare, and contracted sales were up ~+30% year on year in July/August 2025; the future looks brighter.</li><li>SUM stuck its neck out and guided for largely flat net debt from FY25 onwards—a marked change from the last five years, when net debt increased by a factor of 3x.</li></ul>

Summerset (SUM) reported annuity earnings down -28% year on year, its lowest since the COVID-impacted 1H20.NTA continued to grow strongly, in contrast to peer Ryman Healthcare, and contracted sales were up ~+30% year on year in July/August 2025; the future looks brighter.SUM stuck its neck out and guided for largely flat net debt from FY25 onwards—a marked change from the last five years, when net debt increased by a factor of 3x.

Summerset Group 1H25 Waiting for the Golden Years to Arrive

<ul><li>Summerset (SUM) will report its 1H25 result on Thursday, 28 August.</li><li>We forecast ~+30% annuity earnings growth year-on-year and net debt to increase by &gt;+NZ$50m over the half, with some risk of a larger rise.</li><li>Overall, we are attracted to the care suite model and see it as a positive for SUM to reduce net debt and improve returns on its care assets.</li></ul>

Summerset (SUM) will report its 1H25 result on Thursday, 28 August.We forecast ~+30% annuity earnings growth year-on-year and net debt to increase by &gt;+NZ$50m over the half, with some risk of a larger rise.Overall, we are attracted to the care suite model and see it as a positive for SUM to reduce net debt and improve returns on its care assets.

Summerset Group 1H25 Preview—Care Suites To The Rescue

<ul><li>Summerset reported a strong FY24 result with contracted sales up 30% YTD and new sales cash margins remaining high despite concerns over increasing net debt.</li><li>Underlying earnings surpassed expectations due to higher new sales gains and lower P&L interest, although net debt rose by NZ$320mn, 23% for FY24.</li><li>The Australian operations continue to be a drag on cash generation, with a lower build guidance for Australia (50-80) compared to expectations of 100.</li></ul>

Summerset reported a strong FY24 result with contracted sales up 30% YTD and new sales cash margins remaining high despite concerns over increasing net debt.Underlying earnings surpassed expectations due to higher new sales gains and lower P&L interest, although net debt rose by NZ$320mn, 23% for FY24.The Australian operations continue to be a drag on cash generation, with a lower build guidance for Australia (50-80) compared to expectations of 100.

Summerset (SUM): FY24 Result — Initial Impressions

<ul><li>Summerset (SUM) reported strong FY24 results, with annuity EPS, EBITDA, and net tangible assets (NTA) all growing over +10%, through what has potentially been the toughest economic back drop for aged care operators since SUM listed.</li><li>Importantly, SUM delivered a confident message around current demand, with sales contracts and enquires up strongly so far in FY25.</li><li>Over the last few periods, SUM has consistently improved disclosure and transparency. </li></ul>

Summerset (SUM) reported strong FY24 results, with annuity EPS, EBITDA, and net tangible assets (NTA) all growing over +10%, through what has potentially been the toughest economic back drop for aged care operators since SUM listed.Importantly, SUM delivered a confident message around current demand, with sales contracts and enquires up strongly so far in FY25.Over the last few periods, SUM has consistently improved disclosure and transparency. 

Summerset Group - FY24 Result—Staying the Course

Australia

Summerset Group Holdings Ltd. is a profit-oriented entity and develops, owns and operates integrated retirement villages, rest homes and hospitals for the elderly within New Zealand.

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Summerset Group Holdings (SNZ AU)

Summerset Group Positive Developments—Up to OUTPERFORM

We expect SUM to sustain its sector-leading asset growth over the next decade, given: (1) its best-in-class development engine already delivering...

Forsyth Barr

Summerset Group 1H25 Waiting for the Golden Years to Arrive

SUM stuck its neck out and guided for largely flat net debt from FY25 onwards—a marked change from the last five years, when net debt increased by...

Forsyth Barr

Summerset Group 1H25 Preview—Care Suites To The Rescue

We forecast ~+30% annuity earnings growth year-on-year and net debt to increase by >+NZ$50m over the half, with some risk of a larger rise.

Forsyth Barr

Summerset (SUM): FY24 Result — Initial Impressions

Summerset reported a strong FY24 result with contracted sales up 30% YTD and new sales cash margins remaining high despite concerns over...

Forsyth Barr

Summerset Group - FY24 Result—Staying the Course

Summerset (SUM) reported strong FY24 results, with annuity EPS, EBITDA, and net tangible assets (NTA) all growing over +10%, through what has...

Forsyth Barr

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