Charitable donations, Basic Govt underfunded care makes no money
Quote:
Originally Posted by
winner69
Methinks Oceania have a hierarchy - primary focus on residents being looked after then next comes ensuring staff are happy as and they're looked after as well ….and let’s not forget the environment as that’s important as well.
All commendable stuff but I get the impression that shareholders are an after thought. Can’t say they don’t consider them because they’ve borrowed $70m to dish out as dividends (which the shareholders have had to pay $20m tax on). One does tend think we are a pain in the butt but an necessary evil as one day they will be asking for more cash…..more capital raises
I can’t see that hierarchy / culture changing. Shareholders will always be disappointed and frustrated.
Oceania do a great job for the community but investing in them seems to be a rather altruistic activity ……without much satisfaction (warm fuzzies or thanks) in return.
Will pop in at small aged care place up the road (do so regularly) to see if they want a bit of help around the place …..even if it’s mowing their lawn. All covid precautions of course. That probably be more satisfying than being an Oceania benefactor.
Bingo !! I think very few people are aware that many of OCA's facilities were originally acquired from Presbyterian Support Services when they were run as not for profit care facilities. Its not something OCA talk about much, but certainly came out in Q & A when Earl Gasparich presented at the Auckland branch of the shareholders association meeting a few years ago. More often than not the culture never changes.
Sure we're past the previously much hyped, but never talked about these days, point of inflection where we can now enjoy more than 50% of their facilities being either premium rooms, or care suites / independent living units where we hope that the occupation right agreement model gives us a decent return on capital but the way I see it is that currently more than 40% of their business model is ostensibly little different than the not for profit Presbyterian Support services style care facilities that they took over and for all intents and purposes more than 40% of OCA is currently a charity. (I hope my Dad would be proud of me supporting large parts of this business that ostensibly run as a charity).
One thing is for sure, Covid and all the extra costs that come with that is not going away any time soon.
Share price. Back into the $1.00 - $1.10 support zone. Nice chart mate. Objectively, it could be suggested that with no growth whatsoever in earnings per share in the 5 years since they listed maybe that's where the share price belongs until they can prove their business model actually works for shareholders ?, (rather than just delivering all the gains to residents, staff and management).
Until they can prove they can grow earnings I find it difficult to make a convincing case to the contrary. I feel like we've heard them cry wolf for so many years now that the business transformation will deliver gains to shareholders that unless I actually see it, I won't believe it.
How come we never here about the so called magic point of inflection now ? Could it be that the business model is so non commercial all and any gains are eaten away by residents, staff and management and this is likely to be the case going forward as well ? Surely not !...but maybe so...
Isn't philanthropy such fun :)