External broker reports(aggregated public sources), Bell Potter Securities

Bell Potter

External broker reports(aggregated public sources)

Bell Potter Securities

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Equity Bottom-Up

Summerset Group Holdings / Equity Bottom-Up

<ul><li>SUM announced its 1H24 result with underlying profit of NZ$89.9m, at the top end of the guidance range (NZ$87-$90m), slightly ahead of both BPe (+1.6%) and VA consensus (+1.2%).</li><li>No full year profit guidance, but equally no change to SUM’s target for 675-725 new homes under ORA in CY24.</li><li>Key takeouts include: (1) Deploying capital into new sites – SUM has acquired a new site at Mission Hills, Napier for c.300 units (pricing undisclosed) which is ‘shovel ready’ and where it has market visibility as its 5th village in the Hawke’s Bay region. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

SUM announced its 1H24 result with underlying profit of NZ$89.9m, at the top end of the guidance range (NZ$87-$90m), slightly ahead of both BPe (+1.6%) and VA consensus (+1.2%).No full year profit guidance, but equally no change to SUM’s target for 675-725 new homes under ORA in CY24.Key takeouts include: (1) Deploying capital into new sites – SUM has acquired a new site at Mission Hills, Napier for c.300 units (pricing undisclosed) which is ‘shovel ready’ and where it has market visibility as its 5th village in the Hawke’s Bay region. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Summerset Group (SUM.NZ): SUM Still yet to Shine

New Zealand Professional Investment Services Firm, Forsyth Barr

Forsyth Barr

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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.

<ul><li>Summerset (SUM) reported an in-line 1H24 annuity EBITDA result.</li><li>In the result, SUM: (1) gave new earnings breakdowns, which showed stronger Village earnings and softer Care earnings than we expected, and (2) cited a ~NZ$15m cost-out programme.</li><li>The strong cost control contributed to SUM delivering ~+20% growth in annuity EPS over one of the toughest periods on record, an impressive result. SUM also delivered higher-than-expected dividends, suggesting confidence in continued strong cash recovery of development capex. SUM acknowledged slightly slower than hoped for sales at its flagship St John development; it needs to execute well over the coming 12 months.</li></ul>

Summerset (SUM) reported an in-line 1H24 annuity EBITDA result.In the result, SUM: (1) gave new earnings breakdowns, which showed stronger Village earnings and softer Care earnings than we expected, and (2) cited a ~NZ$15m cost-out programme.The strong cost control contributed to SUM delivering ~+20% growth in annuity EPS over one of the toughest periods on record, an impressive result. SUM also delivered higher-than-expected dividends, suggesting confidence in continued strong cash recovery of development capex. SUM acknowledged slightly slower than hoped for sales at its flagship St John development; it needs to execute well over the coming 12 months.

Summerset Group - 1H24 Result — New Metrics, New Valuation

<ul><li>Summerset (SUM) will report its 1H24 result on Monday, 26 August.</li><li>With unit sales known, and narrow underlying earnings guidance, our key points of interest for the result are: (1) sales margins and the breakdown between new sale and resale gains.</li><li>We estimate 1H24 resales margins of 25% versus 26% in 1H23 and consensus of ~27%.</li></ul>

Summerset (SUM) will report its 1H24 result on Monday, 26 August.With unit sales known, and narrow underlying earnings guidance, our key points of interest for the result are: (1) sales margins and the breakdown between new sale and resale gains.We estimate 1H24 resales margins of 25% versus 26% in 1H23 and consensus of ~27%.

Summerset Group - 1H24 Preview — Margins and Metrics

<ul><li>Summerset (SUM) delivered a solid 2Q24 sales update, with resales strong against the backdrop of a subdued New Zealand housing market. </li><li>SUM's ~+23% year-on-year increase in resales for 1H24 (+20% in 2Q24) is a reminder that: (1) there is inbuilt growth in the village operations as they mature; and (2) buying into a village is, to a significant degree, a needs-based decision.</li><li>SUM's first time 1H24 earnings guidance is for earnings broadly flat year-on-year, while at the same time we expect double-digit growth in annuity EBITDA — a more accurate view of its business growth as its villages mature. </li></ul>

Summerset (SUM) delivered a solid 2Q24 sales update, with resales strong against the backdrop of a subdued New Zealand housing market. SUM's ~+23% year-on-year increase in resales for 1H24 (+20% in 2Q24) is a reminder that: (1) there is inbuilt growth in the village operations as they mature; and (2) buying into a village is, to a significant degree, a needs-based decision.SUM's first time 1H24 earnings guidance is for earnings broadly flat year-on-year, while at the same time we expect double-digit growth in annuity EBITDA — a more accurate view of its business growth as its villages mature. 

Summerset Group - Through the Cycle Growth Continues

<ul><li>Summerset Group (SUM) reported strong FY23 underlying earnings and annuity EBITDA, driven by robust resale and new sale gains, partly offset by higher costs.</li><li>All time high resale margins were the stand out, an extraordinary achievement given the weak housing market.</li><li>SUM guided for &gt;+10% growth in unit deliveries for FY24. Strong margins and an increased build rate suggests high demand for SUM's product. </li></ul>

Summerset Group (SUM) reported strong FY23 underlying earnings and annuity EBITDA, driven by robust resale and new sale gains, partly offset by higher costs.All time high resale margins were the stand out, an extraordinary achievement given the weak housing market.SUM guided for &gt;+10% growth in unit deliveries for FY24. Strong margins and an increased build rate suggests high demand for SUM's product. 

Summerset Group  - FY23 — Less Cash, More of Everything Else

New Zealand

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 (SUM NZ)

Summerset Group (SUM.NZ): SUM Still yet to Shine

SUM announced its 1H24 result with underlying profit of NZ$89.9m, at the top end of the guidance range (NZ$87-$90m), slightly ahead of both BPe...

Bell Potter

Summerset Group - 1H24 Result — New Metrics, New Valuation

We estimate ~20% annuity EPS CAGR over the next five years. SUM trades on a ~33x 12 month forward annuity EPS versus its average since 2016 of ~35x.

Forsyth Barr

Summerset Group - 1H24 Preview — Margins and Metrics

With unit sales known, and narrow underlying earnings guidance, our key points of interest for the result are: (1) sales margins and the breakdown...

Forsyth Barr

Summerset Group - Through the Cycle Growth Continues

Summerset (SUM) delivered a solid 2Q24 sales update, with resales strong against the backdrop of a subdued New Zealand housing market.

Forsyth Barr

Summerset Group - FY23 — Less Cash, More of Everything Else

Summerset Group (SUM) reported strong FY23 underlying earnings and annuity EBITDA, driven by robust resale and new sale gains, partly offset by...

Forsyth Barr

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