Originally Posted by
BlackPeter
Hi Roger, you somewhat lost me. From the announcement:
The company’s net profit after tax for 1H14 was NZ$15.3 million, an increase of 42% in 1H13.
Total assets increased over the last 12 months by NZ$157m, and are 21% higher than 1H13. Over the last three years the total assets of the company have grown by 69%.
Underlying profit for the first half of 2014 was NZ$9.4 million. This includes costs related to new village starts and the start-up phase of new care facilities. In the last 12 months Summerset has opened new villages in Hobsonville and Karaka, and has opened care facilities in Nelson, Dunedin and Hamilton. Summerset’s New Plymouth village will be opening in the second half of this year.
How does this look negative to you?
Yes, underlying profit is slightly down due to starting cost for new villages and car facilities, but how can you call that lack of cost control? Makes sense, if you start a new facility that you first need to invest, before you can reap the benefits.
And increased wages ... I'd say if they do that to retain good and experienced staff, than nothing wrong with that. Better to have loyal and experienced staff able to look after the residents than a minimum wage based workforce with little qualifications and high staff turnover - wouldn't you think so as well?
Discl: quite happy holder.