Financial Results for the Year Ended 31 December 2016

Summerset Group Holdings Limited
Level 20, Majestic Centre, 100 Willis St, Wellington
PO Box 5187, Wellington 6140
Phone: 04 894 7320 | Fax: 04 894 7319
Website: www.summerset.co.nz


NZX & ASX RELEASE

23 February 2017


SUMMERSET ACHIEVES 50% GROWTH IN UNDERLYING PROFIT



 Underlying profit for FY16 of NZ$56.6 million, up 50% on FY15
 Net profit after tax of NZ$145.5 million, up 73% on FY15
 NZ$200 million invested into new and existing villages
 Total assets of NZ$1.7 billion, up 25% on FY15
 658 total sales of occupation rights, up 14% on FY15
 414 new sales of occupation rights, up 24% on FY15
 409 new retirement units delivered, up 35% on FY15
 Final dividend of NZ 5.1 cents per share
 Development margin of 22.2%, up from 20.0% for FY15
 FY17 build rate target increased to 450 retirement units, up from 400 for FY16


Summerset Group Holdings Limited has announced an underlying profit of $56.6 million for the
year ending 31 December 2016, up 50% on the previous year. Annual growth in underlying
profit has averaged 48% in the five years since listing in November 2011.

The result indicates the continued growth being experienced by the retirement village developer
and operator as it expands its offering throughout New Zealand.

Net profit after tax, which includes unrealised valuation gains in the fair value of investment
properties, was up 73% for FY16 at NZ$145.5 million, driven by new retirement units built and
good demand across all of Summerset’s villages. Summerset’s total asset value increased by
25% to NZ$1.7 billion. The development margin on new retirement units also increased to
22.2%, up from 20% for FY15.

Summerset CEO Julian Cook said the company now has more than 4,200 residents living at its
21 villages, 700 more than a year ago. “During 2016 we accomplished a number of milestones,
including 658 new sales and resales of occupation rights, a 14% increase on the year before,
and it is the sixth year in a row that we have increased our occupation rights sales. We also now
have more than 1,000 staff across the country, up 200 on the same time last year.

“The delivery of a record 409 retirement units across the country was in line with our FY16 build
rate target of 400. We have increased our target build rate to around 450 new units in 2017. We
also delivered 121 care beds in 2016, bringing the number of care beds across our villages to
748.”

At the end of 2016, Summerset’s total land bank represented 2,609 retirement units and 366
care beds – a total of around six years’ supply.

The company reinvested NZ$200 million into new and existing villages in 2016, which included
extending the recreation areas at Wanganui and Hastings and starting construction on a new
recreation centre at Levin and village centre at Trentham.

In May, the company opened the village centre at Summerset at Monterey Park in Hobsonville,
while the opening of the care centre and village centre at its first Christchurch retirement village
in Wigram was celebrated in September.

“Christchurch was a visible gap in our development portfolio. It is great to be able to ease the
pressure for quality affordable housing in Canterbury,” said Mr Cook.

“A significant milestone for us in 2016 was the opening of our first dementia centre at
Summerset by the Ranges in Levin. It provides rest home level dementia care in a safe, homely
environment, modelled on international design standards. It is the first New Zealand dementia
centre to offer one bedroom apartments, giving residents the option to have a larger home
instead of a care room if they prefer. We intend to incorporate dementia care into our new
villages, with the next centre likely to be at our Casebrook village in Christchurch.”

The first residents moved into their homes at Summerset’s fourth Auckland village in Ellerslie
during October. This village will feature a lake with an island and apartments with views to
central Auckland.

“Like all our villages, the development of our latest Auckland offering is focused on good urban
design to create an attractive environment and community that people are proud to be part of.
We are on track to complete the Ellerslie village centre and care centre in mid-2017.”

Planning for Summerset’s other Auckland villages in St Johns and Parnell, and Boulcott in Lower
Hutt continue to progress. The company also purchased two new development sites in
Richmond, Nelson and the Hamilton suburb of Rototuna in 2016, bringing the total number of
Summerset sites to 27. Summerset already has existing villages in these areas, which have
strong demand for retirement village living.

Summerset’s annual resident and care satisfaction surveys are a key test of how residents living
both independently and in rest home level care perceive the service they receive. This year,
performance was rated at 94% by both care and independent living residents. Mr Cook said the
company is proud of these results. “But we continue to focus on doing even better this year.”
Summerset was also delighted to receive a Highly Commended award in the Aged Care and
Retirement Villages category of the annual Reader’s Digest Trust Brand awards.

Some changes were made to the Board of Directors in 2016. Following the retirement of director
Norah Barlow early in the year, Gráinne Troute was appointed to the Board in September. Dr
Andrew Wong will also join the Board from 1 March 2017.

Andrew and Gráinne’s appointments bring the Board of Directors to six members. Both Gráinne
and Andrew bring to the Board a strong mix of experience and skills. Gráinne has held senior
management roles at SKYCITY Entertainment Group, McDonalds and Coopers & Lybrand and
has experience in operating customer-focused businesses in highly competitive sectors. Andrew
is currently Managing Director of MercyAscot Hospital Group and HealthCare Holdings Limited,
and is a director of a number of medical organisations.

Mr Cook said Summerset’s robust sales and profit during FY16 can largely be attributed to
strong demand for its existing and new villages.

“As one of the country’s largest retirement village developers and operators, we have
established an offering that sees us develop new villages efficiently and operate them well. Our

focus for FY17 will be on continuing to grow Summerset as well as continuing to refine and
improve our customer offering. This should mean continued earnings growth for shareholders.

“Our sales and settlement rates are strong across the country, including Auckland, and we are
seeing no slow down. However, we are well aware that the property market does move in
cycles. Ultimately, demand for our villages is driven by the increased number of older New
Zealanders and what we offer them. Since 1997, when we opened our first retirement village,
Summerset has seen two property market downturns and during each, demand in our villages
remained consistent.

“We also guard ourselves against a downturn by adopting a prudent approach to debt levels. All
our debt relates to development projects and we carry no debt that must be serviced from our
core earnings. At the end of FY16, the value of our development working capital, being land,
work in progress and completed homes awaiting settlement, totalled NZ$307 million, compared
to net outstanding debt of NZ$265 million. Additionally, over the year our gearing reduced to
32.7% from 37.1% at December 2015. This conservative approach to how much debt we take
on and the demand for retirement village living puts us in good shape in the event of a property
downturn.”

Summerset announced a final 2016 dividend of NZ 5.1 cents per share, a total dividend payment
of NZ 7.7 cents per share for the year. This is an increase of NZ 2.45 cents per share on the
total dividend paid in the previous year. The dividend reinvestment plan will apply to the
dividend, with a discount of 2% applicable to those shareholders participating in the plan.


ENDS

For investor relations enquiries: For media enquiries:
Scott Scoullar Michelle Brooker
Chief Financial Officer Senior Communications Advisor
scott.scoullar@summerset.co.nz michelle.brooker@summerset.co.nz
04 894 7320 or 029 894 7317 04 830 1106 or 021 225 9624




ABOUT SUMMERSET
 Summerset is one of the leading operators and developers of retirement villages in New
Zealand, with 21 villages across the country. In addition, Summerset has six sites for
development in Richmond, Rototuna, Casebrook, Lower Hutt, St Johns and Parnell,
bringing the total number of sites to 27.
 It provides a range of living options and care services to more than 4,200 residents.
 Four-time winner of Retirement Village of the Year and Silver Award winner in the Reader’s
Digest Quality Service Awards 2016.
 The Summerset Group has villages in Aotea, Dunedin, Ellerslie, Hamilton, Hastings,
Havelock North, Hobsonville, Karaka, Katikati, Levin, Manukau, Napier, Nelson, New
Plymouth, Palmerston North, Paraparaumu, Taupo, Trentham, Wanganui, Warkworth and
Wigram.

---

0
29 February 2012
FULL YEAR RESULTS
PRESENTATION
YEAR ENDED 31 DECEMBER 2016
SUMMERSET GROUP HOLDINGS LIMITED
23 February 2017

1
AGENDA
FY16 Result Highlights
2
Business Overview
6
Financial Results
20
Appendix
29
Final Dividend
33

2
FY16 RESULT HIGHLIGHTS

3
FY16 RESULT HIGHLIGHTS
RECORDRETIREMENTUNITDELIVERYANDUNDERLYINGPROFIT
* Percentage movements based on unrounded amounts
** Underlying profit differs from net profit after tax (IFRS). Underlying profit is unaudited. Refer to slide 22 for the definition of underlying profit
FY16 ActualFY15 Actual
FY16 Actual vs. FY15
Actual*
FY14 Actual
O
pe
r
atio
na
l
New sales of occupation rights41433324.3%286
Resales of occupation rights244245-0.4%172
Total sales65857813.8%458
New retirement units delivered40930335.0%261
Fi
na
nci
al

(
N
Z$
m
)
Net operating cash flow192.6140.337.3%110.4
Total assets1,7071,36425.2%1,043.2
Underlying profit**56.637.849.6%24.4
Net profit before tax (IFRS)145.682.875.9%54.0
Net profit after tax (IFRS)145.584.272.7%54.2

4
FY16 RESULT HIGHLIGHTS
ANOTHERRECORDRETIREMENTUNITDELIVERYANDUNDERLYINGPROFIT
■FY16 underlying profit of $56.6m, up 50% on FY15
■FY16 net profit after tax (NZ IFRS) of $145.5m, up 73% on FY15
■New sales 24% higher than FY15 –highest level of sales in a full year
■Resale gain of 18.6%, up from 16.0% in FY15
■Development margin of 22.2%, up from 20.0% in FY15
■Final dividend of 5.1 cents per share declared, bringing total FY16 dividend to 7.7
cents per share, and $17.0m
■Operating cash flow up 37% on FY15
■Total assets of $1.7b, up 25% on FY15

5
FY16 RESULT HIGHLIGHTS
STRONGTRENDSCONTINUEACROSSTHEBUSINESS
$8.1m
$15.2m
$22.2m
$24.4m
$37.8m
$56.6m
$m
$10m
$20m
$30m
$40m
$50m
$60m
FY11FY12FY13FY14FY15FY16
UNDERLYING PROFIT
Underlying profit ($m)
122
160
209
261
303
409
0
50
100
150
200
250
300
350
400
450
FY11FY12FY13FY14FY15FY16
RETIREMENT UNIT DELIVERY
Unit delivery
108
167
228
286
333
414
123
164
174
172
245
244
0
100
200
300
400
500
600
700
FY11FY12FY13FY14FY15FY16
SALE OF OCCUPATION RIGHTS
New SalesResales
$617m
$702m
$845m
$1043m
$1364m
$1707m
$500m
$700m
$900m
$1100m
$1300m
$1500m
$1700m
$1900m
FY11FY12FY13FY14FY15FY16
TOTAL ASSETS
Total assets ($m)

6
BUSINESS OVERVIEWBUSINESS BUSINESS OVERVIEW

7
FY16 REVIEW
409RETIREMENTUNITSDELIVERED,TARGETING450DELIVERIESFORFY17
Underlying profit differs from net profit after tax (IFRS). Underlying profit is unaudited. Refer to slide 22 for the definitionof underlying profit.
■Delivered 409 retirement units in FY16, a record for Summerset, and 35% more
than FY15
■Targeting delivery of 450 retirement units in FY17. All deliveries are from existing
sites
■Delivered our first retirement units in Ellerslie
■New village centres opened in Hobsonville and Wigram
■Serviced apartment buildings opened in Nelson, Warkworth, Karaka, New
Plymouth and Katikati
■Delivered our first dementia centre in Levin
■Completed our village in Nelson
■Announced land acquisitions in Rototuna (Hamilton) and Richmond (Nelson)
■Strong sales across New Zealand with a total of 658 retirement units sold, up 14%
on FY15

8
SUMMERSET SNAPSHOT
FASTESTGROWINGRETIREMENTVILLAGEPROVIDERINNEWZEALAND
■2,828 retirement units (villas, apartments, serviced apartments and care suites)
■748 care beds
■More than 4,200 residents
■409 retirement units delivered in FY16
■19 years of consistent delivery and growth
■21 villages completed or in development
■6greenfield sites at Casebrook, Lower Hutt, Parnell, Richmond, Rototuna, and
St Johns not yet started
■Land bank of 2,609 retirement units
■Four-time winner of Retirement Village of the Year
■Silver Award winner in t he Reader’s Digest Quality Service Aw ards 2016
■Received a Highly Commended in t he Reader’s Digest Trusted Brands Survey
in 2015 and 2016

9
SUMMERSET STRATEGY
SUMMERSETBUILDS,OWNSANDOPERATESRETIREMENTVILLAGESINNZ
■Focus on continuum of care model
■High quality care and facilities within every village
■Village designed to integrate into local communities
■Internal development model
■Nationwide brand offering
■Customer centric philosophy –“we lo ve the life you bring to us”
■New Zealand focus
■Delivered 409 retirement units in 2016 and targeting a delivery of 450
retirement units in 2017 to meet strong demand

10
OPERATIONS AND STAFF
FOCUSONCLINICALQUALITYANDSTAFFTRAINING
■94% care customer satisfaction rating and 94% village customer satisfaction rating
■Opened our first dementia facility in Levin and we will incorporate dementia into the design
of new villages
■Launched an all staff share scheme with over 80% of our employees signing up
■Introduced free weekly happy hours across all villages
■Exercise programme, Use it or Lose it,introduced into our villages
■New customer management system selected with new clinical care practice functionality
■Continued Careerforcetraining programme participation, and qualification attainment
■We have continued to invest in our older villages with the extension of recreation areas at
Levin, Wanganui and Hastings villages and a new village centre at Trentham currently
under construction
■Excellent certification audit results continue with ten care centres achieving three years,
and four care centres awarded the maximum four years certification
■Established a dedicated Heath and Safety function in the business and have implemented
a health and safety system to collect incident data and risk assessments

11
DEMOGRAPHICS
POPULATIONOVER75YEARSFORECASTTOGROW239%FROM2016TO2068
Source:StatisticsNewZealand
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
201620182023202820332038204320482053205820632068
POPULATION GROWTH 75 YEARS AND OVER
NZ Population 75+ (left hand axis)% population 75+ (right hand axis)
0
5
10
15
20
25
2016 -
2021
2021 -
2026
2026 -
2031
2031 -
2036
2036 -
2041
2041 -
2046
2046 -
2051
2051 -
2056
2056 -
2061
T
h
o
u
s
a
n
d
s
PER ANNUM POPULATION GROWTH 75 YEARS AND OVER

12
SUMMERSET GROWTH
19YEARSOFCONSISTENTDELIVERYANDGROWTH
--
129
219
407
470
528
652
732
795
921
983
1,109
1,272
1,364
1,486
1,646
1,855
2,116
2,419
129
90
188
63
58
124
80
63
126
62
126
163
80
122
160
209
261
303
409
129
219
407
470
528
652
732
795
921
983
1,109
1,272
1,352
1,486
1,646
1,855
2,116
2,419
2,828
-
500
1,000
1,500
2,000
2,500
3,000
19971998199920002001200220032004200520062007200820092010201120122013201420152016
R
e
t
i
re
m
e
nt

U
ni
t
s
SUMMERSET BUILD RATE
Existing unitsNew units delivered

13
FY16 DEVELOPMENT ACTIVITY
DELIVERYOF409RETIREMENTUNITSINFY16ACROSS11SITES
■409 retirement units delivered across 11 villages –190 in 1H16 and 219 in 2H16
■27% of build within Auckland, 73% across the rest of the country
■Delivered our first units in Ellerslie
■New village centres opened in Hobsonville and Wigram, and delivered serviced apartment buildings in Nelson, Warkworth, Karaka, New Plymouth
and Katikati
■Completed our village in Nelson
Unit Delivery FY16VillasApartmentsServiced ApartmentsCare SuitesTotalCare Beds
Ellerslie12 0 0 0 12 0
Hamilton39 0 0 0 39 0
Hobsonville28 13 0 0 41 0
Karaka12 0 10 0 22 19
Katikati30 0 10 0 40 19
Levin0 0 0 10 10 10
Nelson12 0 30 0 42 0
New Plymouth30 0 12 0 42 24
Trentham34 0 0 0 34 0
Warkworth0 0 36 0 36 0
Wigram38 0 53 0 91 49
Total235 13 151 10 409 121

14
FY16 DEVELOPMENT ACTIVITY
DELIVERYOF409RETIREMENTUNITSINFY16ACROSS11SITES
EllerslieHobsonvilleKaraka
EllerslieHamiltonKatikati

15
FY16 DEVELOPMENT ACTIVITY
DELIVERYOF409RETIREMENTUNITSINFY16ACROSS11SITES
NelsonTrenthamWarkworth
WigramLevinNew Plymouth

16
FUTURE DEVELOPMENT
LANDBANKOF2,609RETIREMENTUNITSAND366CAREBEDS
■Land bank of 2,609 retirement units spread across brownfield and greenfield sites
■Targeting delivery of 450 retirement units in 2017
■Land bank provides around six years of supply at 2017 build rate
*Landbankreflectscurrentintentionsasat31December2016
Land Bank -as at 31 December 2016*
VillageVillasApartments
Serviced & Dementia
Apartments
Total Retirement UnitsCare Beds
Casebrook19707627343
Ellerslie302215730858
Hamilton14030440
Hobsonville18605213052
Karaka1040391430
Katikati7900790
Lower Hutt42964318149
New Plymouth32020520
Parnell32617634048
Richmond22006028038
Rototuna19108027140
St Johns02207029038
Trentham33020530
Warkworth7900790
Wigram8600860
Total1,1288586232,609366

17
DEVELOPMENT MARGIN
REALISEDDEVELOPMENTMARGINOF$39.0M
■Realised development margin of $39.0m, up 49% from $26.1m in FY15
■Development margin of 22.2% in FY16, this is up from 20.0% in FY15
■Development margin of 23.6% in 2H16, this is up from 20.3% in 1H16 and 21.4% in 2H15
$6.9m
$10.5m
$16.7m
$26.1m
$39.0m
12.0%
13.2%
15.7%
20.0%
22.2%
0%
5%
10%
15%
20%
25%
$m
$5m
$10m
$15m
$20m
$25m
$30m
$35m
$40m
$45m
$50m
FY12FY13FY14FY15FY16
REALISED DEVELOPMENT MARGIN -FULL YEAR MARGINS
Realised development margin ($m)Margin (%)

18
NEW SALES OF OCCUPATION RIGHTS
NEWSALESGROSSPROCEEDSUP34%ONFY15TO$176M
*Percentagemovementsbasedonunroundedamounts
■FY16 lift in sales associated with continued build
programme with an additional 106 retirement units
delivered compared to FY15
■Strong new sales volumes in Wigram, Trentham,
Hamilton, New Plymouth, Hobsonville and Nelson
■New sale gross proceeds of $175.6m in FY16, a $44.6m
increase in proceeds relative to FY16
■New sales of occupation rights up versus FY15:
■Villas: 293, up 5% on FY15
■Apartments: 15, up 200% on FY15
■Serviced apartments: 104, up 112% on FY15
■Care suites: 2, first care suites delivered
■Settlements have began in Ellerslie with 6 retirement
units settled as at 31 December 2016. We have seen
good demand with strong presales being achieved on
the villas and apartments to date
■Serviced apartments and care suites made up 26% of
settlements in FY16, this compares to 15% in FY15 and
10% in FY14
New SalesFY16 ActualFY15 Actual
FY16 Actual vs.
FY15 Actual *
FY14 Actual
Gross proceeds ($m)175.6131.034.1%106.3
Villas2932795.0%237
Apartments155200.0%20
Serviced apartments10449112.2%29
Care suites20-0
Total occupation r ights41433324.3%286
160
209
261
303
409
167
228
286
333
414
0
50
100
150
200
250
300
350
400
450
0
50
100
150
200
250
300
350
400
450
FY12FY13FY14FY15FY16
NEW SALES AND RETIREMENT UNIT DELIVERY
Unit deliveryNew Sales

19
RESALES OF OCCUPATION RIGHTS
RESALESOF244OCCUPATIONRIGHTSINFY16
*Percentagemovementsbasedonunroundedamounts
■Gross proceeds of $83.1m, up 8% on FY15
■Realised resale gains up to 18.6% driven by a
strong underlying property market and increased
sophistication of sales pricing
■Only 29 resale occupation rights available for sale,
as at 31 December 2016
■Embedded value up to $114k per retirement unit, as
at 31 December 2016 –up 20% from 31 December
2015
ResalesFY16 ActualFY15 Actual
FY16 Actual vs.
FY15 Actual *
FY14 Actual
Gross proceeds ($m)83.177.07.9%54.9
Realised resale gains ( $m)15.412.324.9%8.1
Realised resale gains ( %)18.6%16.0%15.7%14.7%
DMF realisation ($m)10.39.48.8%6.2
Villas1421392.2%99
Apartments4463-30.2%51
Serviced apartments584334.9%22
Care suites00-0
Total occupation r ights244245-0.4%172
$97m
$94m
$105m
$133m
$159m
$199m
$70m
$79m
$87m
$97m
$109m
$124m
$m
$50m
$100m
$150m
$200m
$250m
$300m
$350m
1H142H141H152H151H162H16
EMBEDDED VALUE
Resales gain ($m)DMF ($m)
164
174
172
245
244
20.4%
18.7%
14.7%
16.0%
18.6%
5.0%
10.0%
15.0%
20.0%
25.0%
40
90
140
190
240
290
FY12FY13FY14FY15FY16
REALISED RESALE GAIN AND VOLUME
Resale VolumeRealised resale gains (%)

20
BUSINESS OVERVIEW
FINANCIAL RESULTS

21
FY16 REPORTED PROFIT (IFRS)
.
NETPROFITAFTERTAXUP73%VERSUSFY15
*Percentagemovementsbasedonunroundedamounts
■NPAT up $61.2m relative to FY15
■FY16 total revenue up 25% versus FY15
■FY16 total expenses up 23% versus FY15
■FY16 expenses include higher operating costs associated with
new villages and opening of care facilities since FY15
■Opened our village in Ellerslie
■Opened new care facilities in Karaka, Katiakti, New
Plymouth and Wigram
■Opened new serviced apartment buildings in Nelson,
Warkworth, Karaka, New Plymouth and Katikati
■Fair value movement of $143.5m for FY16 driven by:
■Additional units delivered through the year, primarily
driven by Wigram and Hobsonville deliveries
■Strong retirement unit price inflation across all villages
NZ$mFY16 ActualFY15 Actual
FY16 Actual
vs. FY15
Actual *
FY14 Actual
Total revenue86.168.825.2%54.3
Fair value movement of
investment property
143.583.571.9%52.5
Total income229.5152.250.8%108.6
Total expenses74.861.122.5%47.8
Net finance costs9.18.48.1%6.8
Net profit before tax145.682.875.9%54.0
Tax expense / (credit)0.2(1.5)N/A(0.2)
Net profit after t ax145.584.272.7%54.2

22
FY16 UNDERLYING PROFIT
Underlying profit differs from IFRS net profit after tax. The directors have provided an unaudited underlying profit measure to assist readers in determining the realised and non-realised components of fair value
movement of investment property and tax expense in the group’s income statement.The measure is used internally in conjunction with other measures to monitor performance and make investment decisions.
Underlying profit is an industry wide measure which the group uses consistently across reporting periods.
UNDERLYINGPROFITUP50%ONFY15,48%CAGROVERLAST5YEARS
*Percentagemovementsbasedonunroundedamounts
■Record full year underlying profit of $56.6m, up 50%
on FY15
■Record half year underlying profit of $31.9m, up from
$24.7m in 1H16
■Realised development margin of $39.0m achieved in
FY16, a record full year result, driven by a
combination of increased volume (+81 settlements)
and improved return from internal development model
■Realised gain on resales of $15.4m achieved in FY16,
a record full year result, driven by strong sales price
growth
■Underlying profit has seen an annual compounded
increase of 48% since we listed in 2011
NZ$mFY16 ActualFY15 Actual
FY16 Actual vs.
FY15 Actual *
FY14 Actual
Reported profit after tax145.584.272.7%54.2
Less fair value movement of
investment property
143.583.571.9%(52.5)
Add r ealised gain on resales15.412.324.9%8.1
Add r ealised development
margin
39.026.149.0%16.7
Add/(less) deferred tax
expense/credit
0.2(1.5)N/A(0.2)
Underlying profit56.637.849.6%24.4

23
FY16 CASH FLOWS
.
CONTINUEDINVESTMENTINNEWVILLAGEBUILDS
*Percentagemovementsbasedonunroundedamounts
■Net operating cash flow of $192.6m for
FY16, up 37% on FY15
■Positive cash flow increases primarily
driven by a combination of a lift in sales
volume and a lift in realised margin
■Net investing cash flow of $199.9m, down
10% on FY15
■Lift in development spend to delivery
higher build rate was off-set by lower new
land settlements compared to FY15
NZ$mFY16 ActualFY15 Actual
FY16 Actual vs.
FY15 Actual *
FY14 Actual
Care fees and village services57.246.423.2%36.2
Interest received0.20.5-52.4%0.3
Payments to suppliers and
employees
(68.6)(57.0)20.3%(42.0)
Net receipts f or resident loans203.7150.335.6%115.9
Net operating cash flow192.6140.337.3%110.4
Acquisition of PPE & IP(193.8)(220.7)-12.2%(139.8)
Other investing cash flows(6.0)(2.1)187.2%(2.2)
Net investing cash flow(199.9)(222.8)-10.3%(142.1)
Proceeds from bank loans25.897.4-73.5%45.6
Dividends paid(13.1)(8.6)52.8%(10.0)
Proceeds from issue of shares4.23.038.9%4.4
Other financing cash flows(7.6)(7.6)1.1%(6.5)
Net f inancing cash flows9.284.3-89.1%33.5
Net increase i n cash2.01.89.9%1.8

24
FY16 BALANCE SHEET
.
TOTALASSETSOF$1.7B,UP25%FROM$1.4BINFY15
*Percentagemovementsbasedonunroundedamounts
■Total assets of $1.7b, up 25% on FY15
■Retained earnings have increased by 84% to $289.1m as
at 31 December 2016, benefiting from company growth and
associated positive impact on annual profits. This will
continue to positively impact balance sheet strength and
company gearing ratios
■Investment property valuation of $1.6b, up 26% on FY15
■Other assets include land and buildings (primarily care
facilities)
■Embedded value of $322.6m, $114k per retirement unit, as
at 31 December 2016:
■$198.6m resales gain
■$124.1m deferred management fee
NZ$mFY16 ActualFY15 Actual
FY16 Actual vs.
FY15 Actual *
FY14 Actual
Investment property1,591.41,261.226.2%958.2
Other assets115.4102.412.7%85.0
Total assets1,706.81,363.525.2%1,043.2
Residents' loans801.3637.225.8%513.7
Bank loans274.0248.210.4%150.8
Other liabilities85.968.325.6%46.4
Total liabilities1,161.2953.821.7%710.9
Net assets545.6409.833.1%332.3
Embedded value322.6229.740.5%172.1
NTA (cents per share)249.9188.532.6%153.3

25
GEARING RATIO
.
GROSSDEBTOF$274MANDGEARINGRATIOOF32.7%
*Percentagemovementsbasedonunroundedamounts
■Gross debt of $274.0m as at 31 December 2016, up $11.3m
from 30 June 2016
■Uplift of $11.3m in gross debt principally due to land and
property purchases
■Have seen lift in development expenditure with large builds in
Ellerslie, Hobsonville and Wigram, principally offset by new
sale settlements and operational cash flows
■Bank facility was increased from $255m to $450m in 2015 to
support our increased build rate and to provide additional
financial flexibility
■Gearing ratio of 32.7% is down from 36.1% as at 30 June
2016. This is in line with expectations and remains at a
prudent level
■Gross debt does not include the full land purchase in
Richmond
NZ$m2H16 A ctual1H16 A ctual
2H16 Actual vs.
1H16 Actual *
FY15 Actual
Bank loans274.0262.74.3%248.2
Cash and cash
equivalents
8.79.4-7.9%6.7
Net debt265.3253.34.7%241.5
Net assets545.6448.721.6%409.8
Gearing ratio (%)32.7%36.1%-9.4%37.1%
$69m
$78m
$105m
$151m
$248m
$274m
20.5%
23.3%
26.6%
30.5%
37.1%
32.7%
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
$m
$50m
$100m
$150m
$200m
$250m
$300m
$350m
FY11FY12FY13FY14FY15FY16
GROSS BANK LOANS AND GEARING RATIO
Bank loansGearing ratio

26
PROJECT CASH PROFITS
.
DELIVERINGSIGNIFICANTPOSITIVECASHFLOWVILLAGES
*Forecastnetpositionrepresentscashprofitspostlandcost,ILUdevelopmentcosts,
recreationandadministrationfacilitycosts,carefacilitycosts,managementfeesandinterest
costs
■Positive cash flows allow us to recycle our capital into future deliveries
■Our Auckland sites require a large amount of capital but are forecast to deliver
significant cash profits upon sell down of the village
■Our regional sites require a lower amount of capital and are forecast to deliver
lower, but still positive, cash profits
■Our villages, on average, are completed over a 5 year period
Village
Forecast Capital
Investment ($m)
Forecast Net Cash
Position* ($m)
Ellerslie
Hobsonville
Karaka
$100m +$20m +
Hamilton
Nelson
Trentham -Extension
Warkworth -Extension
Wigram
$35m +
$5m -$20m
Katikati
New Plymouth
$0 -$5m
Hamilton
Nelson
Katikati
Hobsonville
Karaka
Trentham - Extension
New Plymouth
Wigram
Ellerslie
Warkworth - Extension
2014201520162017201820192013
SUMMERSET DEVELOPMENTS
2010201120122020

27
ASSET BACKING
.
STRONGASSETBACKINGTONETDEBT
■We adopt a prudent approach to debt. All our debt relates to
development projects with our net debt of $265m primarily made
up of undeveloped land, vacant new sale stock and work in
progress
■Our asset backing is strong with a value to debt ratio of around
1.2x. Total underlying assets of around $307m are made up of:
■Undeveloped land of $135m
■Development WIP of $122m
■Vacant new sale stock of $50m
$265m
$135m
$122m
$50m
$m
$50m
$100m
$150m
$200m
$250m
$300m
$350m
Net DebtUnderlying Assets
NET DEBT TO UNDERLYING ASSETS
Net DebtUndeveloped LandDevelopment WIPUnsold Stock

28
UNDERLYINGPROFIT5YEARCAGROF48%
5YEAR METRICS SUMMARY
*Compoundedannualgrowthrate.
5 Year CAGR*FY16FY15FY14FY13FY12FY11
Op
e
r
a
t
ion
a
l
New sales of occupation rights31%414333286228167108
Resales of occupation rights15%244245172174164123
Total sales23%658578458402331231
New units delivered27%409303261209160122
Retirement units in portfolio14%282824192116185516461486
Care beds in portfolio18%748616485442327327
Fina
n
c
ial
(
N
Z$m
)
Total revenue ($m)21%86.168.854.345.238.133.7
Net profit after tax ($m)102%145.584.254.234.214.84.3
Underlying profit* ($m)48%56.637.824.422.215.28.1
Net operating cash flow ($m)35%192.6140.3110.488.666.343.7
Total assets ($m)23%1,706.81,363.51,043.2844.9702.3616.9
Total equity ($m)19%545.6409.8332.3281.9248.8233.4
Interest bearing loans and borrowings ($m)32%274.0248.2150.8105.378.269.1
Cash and cash equivalents ($m)-1%8.76.74.93.02.89.0
Gearing ratio (Net D/ Net D+E)10%32.7%37.1%30.5%26.6%23.3%20.5%
EPS (cents) (IFRS profit)95%66.9338.9425.1615.996.962.39
NTA (cents)18%249.90188.52153.33131.24116.49109.33
Development margin (%)29%22.2%20.0%15.7%13.2%12.0%6.2%

29
FINAL DIVIDEND

30
FY16 FINAL DIVIDEND
.
SUMMERSETBOARDDECLARESFY16FINALDIVIDEND
■The Summerset Board have declared a final dividend of 5.1 cents per share, unimputed. This compares to a 2015 final dividend of 3.4 cents per
share
■This represents a total pay-out for the second half of 2016 of approximately $11.3m
■Total dividends for the 2016 year (interim and final) of 7.7 cents per share, being approximately $17.0m, representing 30.1% of underlying profit and
up 47% on FY15
■The dividend reinvestment plan (DRP) will apply to this dividend enabling shareholders to take shares in lieu of the cash dividend
■A discount of 2% will be applied when determining the price per share of shares issued under the DRP
■Eligible investors wishing to take up the DRP must register by 5pm NZT on Friday the 10
th
of March 2017. Any applications received on or after this
time will be applied to subsequent dividends
■The final dividend will be paid on Wednesday the 22
nd
of March 2017. The record date for final determination of entitlements to the final dividend is
Thursday the 9
th
of March 2017
■The dividend policy remains 30% to 50% of underlying profit for the full year period. As previously indicated, dividend paymentsare likely to continue
to be at the bottom end of this range given the growth opportunities present for the business at this time

31
QUESTIONS?

32
DISCLAIMER
Thispresentationmaycontainprojectionsorforwardlookingstatementsregardingavarietyofitems.Suchforward-lookingstatementsare
baseduponcurrentexpectationsandinvolverisksanduncertainties.
Actualresultsmaydiffermateriallyfromthosestatedinanyforwardlookingstatementbasedonanumberofimportantfactorsandrisks.
Althoughmanagementmayindicateandbelievetheassumptionsunderlyingtheforwardlookingstatementsarereasonable,anyofthe
assumptionscouldproveinaccurateorincorrectand,therefore,therecanbenoassurancethattheresultscontemplatedintheforward
lookingstatementswillberealised.
Furthermore,whileallreasonablecarehasbeentakenincompilingthispresentation,Summersetacceptsnoresponsibilityforanyerrorsor
omissions.
Thispresentationdoesnotconstituteinvestmentadvice.

33
APPENDIX

34
2,828RETIREMENTUNITSAND748CAREBEDS
PORTFOLIO AS AT 31 DECEMBER 2016
Existing Portfolio –as at 31 December 2016
VillageVillasApartmentsServiced ApartmentsCare Suites
Total Retirement
Units
Care Beds
Aotea96333801670
Dunedin612020010142
Ellerslie12000120
Hamilton169020018949
Hastings1465001510
Havelock North94280012245
Hobsonville10713001200
Karaka7802009850
Katikati7702009749
Levin64220109641
Manukau896727018354
Napier942620014048
Nelson214055026959
New Plymouth7602009652
Palmerston North90120010244
Paraparaumu92220011444
Taupo94341801460
Trentham1981220023044
Wanganui701812010037
Warkworth123244016941
Wigram73053012649
Total2,117314387102,828748

35
LANDBANKOF2,609RETIREMENTUNITSAND366CAREBEDS
LAND BANK AS AT 31 DECEMBER 2016
*Landbankreflectscurrentintentionsasat31December2016
Land Bank -as at 31 December 2016*
VillageVillasApartments
Serviced & Dementia
Apartments
Total Retirement UnitsCare Beds
Casebrook19707627343
Ellerslie302215730858
Hamilton14030440
Hobsonville18605213052
Karaka1040391430
Katikati7900790
Lower Hutt42964318149
New Plymouth32020520
Parnell32617634048
Richmond22006028038
Rototuna19108027140
St Johns02207029038
Trentham33020530
Warkworth7900790
Wigram8600860
Total1,1288586232,609366

---

ANNUAL REPORT 2016

Summerset Snapshot ...................................................................................................................................................................2
Business Highlights
.........................................................................................................................................................................5
Portfolio Growth
...................................................................................................................................................................................6
Financial Highlights
.....................................................................................................................................................................9
People Highlights
..............................................................................................................................................................................13
Chairman’s Report
........................................................................................................................................................................14
Chief Executive Officer’s Report
...............................................................................................................16
Directors’ Profiles
.........................................................................................................................................................................20
Executive Team Profiles
.................................................................................................................................................22
Five Year Historical Summary
.......................................................................................................................24
Financial Statements
.............................................................................................................................................................27
Governance
..................................................................................................................................................................................................60
Remuneration
........................................................................................................................................................................................66
Disclosures
.....................................................................................................................................................................................................72
Company Information
..........................................................................................................................................................79
Directory
..............................................................................................................................................................................................................80
Cover image: Fay in Havelock North’s Divine Café Jean and Stan, Paraparaumu
This document is printed on an environmentally responsible paper produced using Elemental Chlorine Free (ECF) pulp sourced from
sustainable and legally harvested farmed trees, and manufactured under the strict ISO14001 Environmental Management System.

2
SUMMERSET SNAPSHOT
4,200
RESIDENTS
MORE THAN
LAND BANK OF
LAND BANK OF
2,828
RETIREMENT UNITS
IN PORTFOLIO
MORE THAN
1,000
STAFF MEMBERS
74 8
CARE BEDS
IN PORTFOLIO
450
RETIREMENT UNITS:
BUILD RATE FOR 2017
21
VILLAGES COMPLETED
OR UNDER DEVELOPMENT
6
GREENFIELD
SITES
409
RETIREMENT UNITS
BUILT IN 2016
2,609
RETIREMENT
UNITS
366
CARE BEDS

54
SUMMERSET ANNUAL REPORT 2016
BUSINESS HIGHLIGHTS
2
CARE CENTRE
OPENINGS
WIGRAM CARE CENTRE &
LEVIN DEMENTIA CENTRE
MILESTONE
22.2%
DEVELOPMENT
MARGIN
SALES OF
658
OCCUPATION RIGHTS
2
LAND ACQUISITIONS
ROTOTUNA, HAMILTON
& RICHMOND, NELSON
121
CARE BEDS
DELIVERED
NELSON VILLAGE
COMPLETED
409
RETIREMENT
UNITS DELIVERED
FIRST RESIDENTS
MOVE INTO ELLERSLIE,
AUCKLAND VILLAGE

7
SUMMERSET ANNUAL REPORT 2016
6
New retirement units delivered
Existing stock
409
new retirement units completed
35%
more units built than in 2015
2,828
total retirement units in portfolio
The New Zealand population
aged over 75 years is forecast
to more than triple in the next
50 years.
The number of people aged 75
and over is projected to increase
from 295,000 in 2016 to 1,001,000
by 2068. This is an increase from
6% of the population to 16%.
The number of people aged 85
and over is projected to increase
from 83,000 in 2016 to 387,000 in
2068. This is an increase from
1.8% of the population to 6.3%.
2016 HIGHLIGHTS
3,000
2,500
2,000
1,500
1000
500
0
’98’97’99’00’01’02’03’04’05’06’07’08’09’10’11’12’13’14’15’16
1292194074705286527327959219831,1091,2721,3641,4861,6461,855 2,1162,419129
12990
188
63
58
124
80
63
126
126
62
163
80
122
160
209
261
303
409
219
407
470
528
652
732
795
921
983
1,109
1,272
1,352
1,486
1,646
1,855
2,116
2,419
2,828
PORTFOLIO GROWTH
19 years of consistent delivery and growth

FINANCIAL HIGHLIGHTS
73%
INCREASE
ON FY2015
$
145.5m
NET PROFIT
AFTER TAX FY2016
25%
INCREASE
ON FY2015
$
1.7 b
TOTAL ASSETS
37%
INCREASE
ON FY2015
$
192.6m
OPERATING
CASH FLOW
$
56.6m
UNDERLYING
PROFIT FY2016
50%
INCREASE
ON FY2015
Napier residents enjoying a game of croquet
9
SUMMERSET ANNUAL REPORT 2016

10
FINANCIAL HIGHLIGHTS
Continued
RESULTS HIGHLIGHTS
–
FINANCIAL
FY2016FY2015% CHANGE
Net operating cash flow ($000)
192,610140,26837.3%
Net profit before tax (NZ IFRS) ($000)
145,63882,77575.9%
Net profit after tax (NZ IFRS) ($000)
145,48084,24572.7%
Underlying profit * ($000)
56,55637,80049.6%
Total assets ($000)
1,706,7731,363,53925.2%
Net tangible assets (cents per share)
249.90188.5232.6%
*Underlying profit differs from NZ IFRS net profit after tax.
RESULTS HIGHLIGHTS
–
OPERATIONAL
FY2016FY2015% CHANGE
New sales of occupation rights
41433324.3%
Resale of occupation rights
244245(0.4%)
New retirement units delivered
40930335.0%
Realised development margin ($000)
38,95426,13849.0%
Gross proceeds (new sales) ($000)
175,641131,01734.1%
Realised gains on resales ($000)
15,42312,34524.9%
UNDERLYING PROFIT
$000FY2016FY2015% CHANGE
Reported profit after tax
145,48084,24572.7%
Less fair value movement of investment property *
(143,459)(83,458)71.9%
Add realised gain on resales
15,42312,34524.9%
Add realised development margin
38,95426,13849.0%
Add/(less) deferred tax expense/(credit)*
158(1,470)N /A
Underlying profit56,55637,80049.6%
*Figure has been extracted from financial statements.
Underlying profit differs from NZ IFRS net profit after tax. The Directors have provided an unaudited underlying
profit measure to assist readers in determining the realised and non-realised components of fair value movement
of investment property and tax expense in the Group’s income statement. The measure is used internally in
conjunction with other measures to monitor performance and make investment decisions. Underlying profit is
an industry-wide measure which the Group uses consistently across reporting periods.
Bev and Molly, Karaka

1312
SUMMERSET ANNUAL REPORT 2016
MORE THAN
4,200
RESIDENTS
MORE THAN
1,000
STAFF MEMBERS
NEW STAFF SHARE
PLAN LAUNCHED
200
NEW ROLES
CREATED
94%
CARE RESIDENT
AND FAMILY
SATISFACTION
94%
VILLAGE RESIDENT
SATISFACTION
PEOPLE HIGHLIGHTS

1514
SUMMERSET ANNUAL REPORT 2016
Welcome to Summerset’s Annual Report for the financial year to 31 December
2016. We report on another year of good performance and a strong set of
annual results. This year we continued to expand our offering around the
country with two land acquisitions, the successful opening of the village
centres at our Wigram and Hobsonville villages, and our first dementia
service, in Levin.
In 2016 Summerset delivered an underlying profit
of $56.6 million, an increase of 50% on 2015, and a
net profit after tax of $145.5 million, a 73% increase
on 2015. We deliver these results by providing our
residents with an offering that meets or exceeds
their expectations, ensuring they are proud to live
at a Summerset village.
In November 2016 we opened our new purpose-built
dementia centre at Summerset by the Ranges in
Levin – a first for Summerset.
We intend to extend this service to our new villages
in the future. We also continue to invest in our older
villages, recently extending the recreation areas at
Wanganui and Hastings, and starting construction
on a new recreation centre in Levin and a new village
centre in Trentham.
The Board has declared a final dividend of 5.1 cents
per share. This is a total dividend payment for 2016
of 7.7 cents per share, which represents 30% of
underlying profit.
The last date for receipt of an election notice, from
a shareholder, for participation in the dividend
reinvestment plan is 10 March 2017.
I am delighted to announce the appointment of a
new Summerset Board member, Dr Andrew Wong,
who will join the Board from 1 March 2017. Andrew’s
appointment brings the Board of Directors to six
members and follows the appointment of Gráinne
Troute in September 2016.
Both Gráinne and Andrew bring a strong mix of
experience and skills to the Summerset Board.
Gráinne has held senior management roles at
SKYCITY Entertainment Group, McDonalds, and
Coopers & Lybrand, and has experience operating
customer-focused businesses in highly competitive
sectors. Andrew is currently Managing Director
of MercyAscot Hospital Group and HealthCare
Holdings Limited and director of a number of medical
organisations. His mix of medical and commercial
experience will bring a unique skill set to our
board table.
CHAIRMAN’S REPORT
As forecast in last year’s annual results, our earnings
grew strongly in 2016. Looking to 2017, Summerset is
well placed to continue to deliver quality retirement
living and the corresponding financial results from
which our residents, staff and investors all benefit.
Summerset has grown very quickly since its listing,
and our market, capital resources and people all
enable continued growth. Some of this growth will be
in new or expanded physical assets, while other parts
will be in the development of a wider range of services.
In the coming year, the Board will give a lot of
attention to the best allocation of resources to achieve
the best outcomes for the business and our residents.
On behalf of the Board, I thank you for your continued
support.

Rob Campbell
Chairman
Artist’s impression of Trentham’s new village centre

1716
SUMMERSET ANNUAL REPORT 2016
Summerset accomplished a number of milestones in
2016. We achieved 658 occupation right sales (new
sales and resales), a 14% increase on the 578 sales in
2015. Our development margin hit 22.2%, up from 20%
in 2015, and we exceeded our forecast build rate of 400
retirement units, with an increase of over 100 homes
built from the previous year. We also recorded a $56.6
million underlying profit, up 50% on the same period
last year.
Auckland and Christchurch growth
Auckland and Christchurch will be a focus during the
next few years.
In September we opened the village centre and
care centre at our first Christchurch village in
Wigram. Earthworks have begun at our Casebrook
site for a village that will offer over 170 townhouses
and villas, 40 care beds and our second dementia
care offering.
Christchurch was previously a visible gap in our
development portfolio, and it is pleasing to be
part of the city as it rebuilds, helping to ease the
significant pressure for quality, affordable housing in
Christchurch. We expect our future development plans
in Auckland will also go some way to relieving the
housing challenges in New Zealand’s largest city.
The first residents moved into their new homes at
Summerset at Heritage Park in Ellerslie in October,
and we are on track to complete their village centre
and care centre in mid-2017. When completed, the
village will feature a lake with an island, upon which
the bowling green and barbeque facilities will be
located. Our Ellerslie village will have buildings
ranging from two to seven levels with a focus on
creating an attractive environment that feels like a
real home and community that people want to be part
of. This attention to good urban design is essential to
making larger villages work well for residents and the
surrounding communities.
We continue to carry out planning for our two other
Auckland sites in St Johns and Parnell. We hope to
be in a position to apply for resource consent for our
St Johns village in the early part of 2017, and are
progressing the design for our Parnell village. Again,
with both of these villages, we are focused on good
urban design and creating vibrant communities for
our residents.
Plans for our Boulcott, Lower Hutt village are
progressing, though at a slower rate than we would
like. In October 2016, Hutt City Council approved our
application to rezone 2.9 hectares of our Boulcott
site from General Recreational Activity to General
Residential Activity with special provision for a
retirement village. We will continue to work through
this process and hope to lodge a resource consent
application later this year.
In 2016 we purchased two new sites for development.
One site is in Richmond, Nelson and the other in
the Hamilton suburb of Rototuna. These purchases
bring the total number of Summerset locations to 27
nationwide. We have existing villages in Nelson and
Hamilton and have found there is strong demand for
retirement living in these areas.
At the end of 2016, Summerset’s total land bank
represented 2,609 retirement units and 366 care beds.
This is a total of around six years’ supply based on our
intended build programme for retirement units in 2017
of around 450 units.
Supporting our people
Our staff play an integral part in the happiness and
wellbeing of our residents and the ongoing success
of Summerset. In 2016, we launched a number of
initiatives that recognise the role our staff play. We
plan to continue this investment in staff over the next
few years as this is a key part of building a dedicated
team, and gives us a competitive advantage. Some of
the initiatives launched last year are outlined below.
In June we introduced a staff share plan so that staff
can participate in Summerset’s financial performance.
More than 80% of our staff have signed up to the share
plan, which provides each staff member with $780
worth of shares that vest after three years if they
remain with the company. It is intended that an offer
of $780 worth of shares is made annually to staff.
While there is a cost to shareholders from this plan,
we believe it is a worthwhile investment.
Health and Safety is an area of focus for many
businesses. This year we have made good progress
towards improving our systems and culture with the
ultimate aim of preventing and reducing harm to
employees, residents, contractors and visitors to our
villages. We established a dedicated Health and Safety
function and have implemented a Health and Safety
system to collect incident data and risk assessments.
With guidance and input from our Board, we are
committed to continuing to progress this area in 2017.
To recognise the hard work our caregivers do, and the
important role they play in the lives of our residents, we
implemented a number of initiatives and staff benefits
in 2016, including an annual uniform allowance. In
addition to this, our caregivers, nurses and clinical staff
who work overtime, double or night shifts now enjoy
a meal from their village kitchen or café during their
shift. In 2017, we will be undertaking a review of our
uniform in consultation with the people who wear it
to ensure they are comfortable and supported in their
work. This is an exciting project for us and we are keen
to come up with a stylish and practical design that our
staff will be proud to wear.
CHIEF EXECUTIVE
OFFICER’S REPORT
With over 4,200 residents, 700 more than last year, growth was a key driver
of Summerset’s performance in 2016. This strengthens our position as New
Zealand’s fastest-growing retirement village and aged care provider.
Artist’s impression of Ellerslie’s apartments

1918
SUMMERSET ANNUAL REPORT 2016
In December, we welcomed Eleanor Young to the
position of GM Operations and Customer Service.
Eleanor’s role is an integral one for Summerset’s
executive team, reflecting the importance of the
operations part of our business to deliver on our
customer promise in our villages. Eleanor comes from
Inland Revenue where she ran the Customer Services
group. We are excited to have her join our team.
Summerset’s simple philosophy
“Love the Life” respects the wonderful lives residents
bring to Summerset villages. The annual resident and
care satisfaction surveys are a key test of whether we
are delivering on this.
Our performance in the 2016 survey was 94%
satisfaction for people living independently and
94% satisfaction for residents living in our care
facilities, a slight increase on last year’s care centre
results. We are proud of these results and I would like
to thank our staff who work hard to achieve them. Of
course, there is always room to do better and this will,
as always, be something we focus on in 2017. I have
previously indicated that I visit all of our villages every
year, where I talk with residents and staff. Staying
connected with residents, staff and village life is an
essential part of my role.
For many people the social life and events at our
thriving Summerset communities is a big factor in
their decision to move to one of our villages. This year
we announced that we will provide free drinks at the
popular weekly happy hours – this is one of the ways
we say thanks to our residents. We also introduced
a nationwide exercise programme at all of our
villages called “Use it or Lose it”. This has been very
popular with residents and is designed to provide a
range of beneficial exercises in a fun and interactive
environment.
Each village has an activities co-ordinator whose role
is to ensure there is always something happening.
This year we’ve had many great events at our villages,
including It’s in the Bag, masquerade dances, market
days, concerts, residents’ wedding, fashion parades,
and even a onesie dance shuffle fundraiser that made
it on to the TV news. We also launched our Summerset
Facebook page in September, meaning we can now
share these exciting activities with a wider audience.
The opening of our first purpose-built dementia centre
at our Levin village is an important step for us. The
centre provides rest home-level dementia care in a safe,
homely environment, modelled on international design
standards. It has 10 care rooms and 10 one-bedroom
apartments, complete with a kitchenette and living
area, giving residents the choice to live in a larger home
if they prefer. It is the first dementia centre in New
Zealand to offer this type of apartment-style living.
Our Levin village was chosen as the location for the
dementia centre because it is an established village
that has been part of the local community for 15 years.
Dementia is a key cause of disability later in life and
the number of people with dementia is expected to
increase in coming years. The centre will ensure people
at our Levin village and the wider community won’t
have to move far if they find themselves requiring this
level of care. We plan to incorporate dementia care
into future villages, with the next facility to be at our
Casebrook village in Christchurch.
During 2016, Summerset received a Highly Commended
award in the Aged Care and Retirement Villages
category of the annual Reader’s Digest Trusted Brand
awards. We were delighted with the comments from
participants about our villages, including “Summerset
villages are the nicest ones I’ve been to.”
Looking to the future
We are experiencing a period of demographic change
in New Zealand. As one of New Zealand’s largest
retirement village developers and operators, we have
established an offering that sees us develop new
villages efficiently and operate them well. Our focus
will remain on growing the business and refining
and improving how we run our villages.
For shareholders, this should mean continued growth
in earnings. We have discussed our approach to
property market cycles in previous annual reports.
In short, demand for our villages is driven by the
increased number of older New Zealanders and the
value we offer them in that stage of life. This demand
is not driven by the property market. Since opening
our first village almost 20 years ago, Summerset has
seen two property market downturns and during each,
demand for our services remained consistent.
To guard against a downturn, we adopt a prudent
approach to debt levels. All of our debt relates to
development projects. As at 31 December 2016, the
value of our development working capital (being land,
work in progress, and completed homes awaiting
settlement) totalled $307 million. This compared to
net outstanding debt at the same time of $265 million.
We believe that our conservative approach to how
much debt we take on, and the underlying demand
for retirement village living, puts us in good shape
in the event of a property downturn.
It is a pleasure to present you with the 2016 Annual
Report. Thank you to our investors who continue to
support Summerset, our residents who have chosen
a Summerset village as their home, and our staff,
who work to ensure our residents love the life they
lead at Summerset.
Julian Cook
Chief Executive Officer
Katikati’s coastal villas
Courtyard of Levin’s dementia centre

2120
SUMMERSET ANNUAL REPORT 2016
Rob Campbell
Independent Chairman
Rob Campbell has over 30 years’
experience as a director and
investor.
He is currently the Chair of Tourism
Holdings Ltd, G3 Group Ltd, and a
director of Precinct Properties New
Zealand Ltd and T&G Global Ltd all
listed companies in New Zealand.
Rob is also an investor in and
director of a number of substantial
private companies and is a director
of, or an advisor to, a number of
private global equity and hedge
funds. Rob holds a Bachelor of
Arts with First Class Honours in
Economic History and Political
Science and a Masters of Philosophy
in Economics.
Dr Marie Bismark
Non-executive
Independent
Marie is dually trained as a lawyer
and doctor, and divides her time
between Australia and New
Zealand. She has worked in the
health sector for many years;
her areas of expertise include
patient safety and healthcare
complaints resolution.
She is an associate professor at
the University of Melbourne and a
consultant on the health law team
at legal firm Buddle Findlay in
Wellington. She serves as a director
on the board of GMHBA Health
Insurance and is a member of the
Veterans’ Health Advisory Panel.
Anne Urlwin
Non-executive
Independent
Anne is a professional director
with experience in a diverse range
of sectors including construction,
health, infrastructure, financial
services and telecommunications.
She is Chair of national commercial
construction company Naylor Love
Enterprises Ltd and Deputy Chair
of Southern Response Earthquake
Services Ltd.
Anne’s other directorships include
Steel and Tube Holdings Ltd, Chorus
Ltd and ANZ Bank subsidiary
OnePath Life (NZ) Ltd.
Anne is a chartered accountant
with experience in senior finance
management roles in addition to
her governance roles. She is also the
independent Chair of Te Rūnanga
o Ngāi Tahu Audit and Risk
Committee.
Gráinne Troute
Non-executive
Independent
Gráinne has many years’
experience in senior executive
roles with Coopers and Lybrand
(now PwC), McDonald’s
Restaurants NZ, HR Consultancy
Right Management and most
recently as General Manager
Corporate Services at SKYCITY
Entertainment Group. She is
also a director of Tourism
Holdings Limited.
Gráinne has vast knowledge of
operating customer-focused
businesses in highly competitive
sectors and in board and
charitable trust governance
roles in New Zealand. She has
also spent many years as a
trustee and chair in the not-
for-profit sector, including as
Chair of Ronald McDonald House
Charities NZ for five years.
James Ogden
Non-executive
Independent
James is Chair of Tegel Group
Holdings, and a director of The
Warehouse Group, Vista Group
International and Alliance Group
Ltd as well as Chair of Summerset’s
Audit Committee.
James has had a career as an
investment banker, including six
years as Country Manager for
Macquarie Bank and five years as
a director of Credit Suisse First
Boston. James also worked in the
New Zealand dairy industry for
eight years in chief executive and
finance roles.
James holds a Bachelor of
Commerce and Administration
with First Class Honours and is a
Chartered Fellow of the Institute
of Directors and a Fellow of the NZ
Institute of Chartered Accountants.
DIRECTORS’ PROFILES

2322
SUMMERSET ANNUAL REPORT 2016
Julian Cook
Chief Executive Officer
Julian has overall responsibility
for the company, its operations
and its strategy. In his previous
role as Chief Financial Officer,
Julian oversaw Summerset as it
became a publicly listed company,
first on the NZX in November 2011,
and then the Australian Securities
Exchange (ASX) in July 2013.
Prior to joining Summerset, Julian
spent 11 years in the investment
sector, which included a significant
amount of work with retirement
village and aged-care companies.
Paul Morris
General Manager,
Development
Paul leads Summerset’s
development division, which covers
all aspects of the development
process of our villages, from site
identification and purchase, to
consenting, concept and master
plans and design standards.
Paul joined Summerset in 2000
after more than 20 years in
banking, including 15 years in
retirement village and aged-care
sector business banking.
Paul held several senior roles at
Summerset before taking up his
current position, giving him a
sound understanding of all
aspects of the business.
Eleanor Young
General Manager,
Operations and Customer
Experience
Eleanor joined Summerset as
GM Operations and Customer
Experience in 2016. Her role oversees
the operational performance
across all Summerset villages.
Eleanor’s particular focus on service
experience and delivery ensures
Summerset residents receive the
highest-quality service and care.
Before joining Summerset, Eleanor
held senior roles in Inland Revenue,
including four years as the Group
Manager of Customer Services,
managing services to customers
with around 2,000 staff in various
locations across New Zealand.
Eleanor also has a background in
human resources within both the
public and private sector working in
managerial roles for the Ministry of
Social Development, Mighty River
Power, and Air New Zealand.
Jarrod Smith
General Manager,
Sales
Jarrod leads the national
sales team, which is based in
villages across the country
and in Wellington.
Jarrod has significant general
management experience across
a range of industries and has
successfully led large national
and international sales divisions
across multiple countries and
channels to deliver year-on-
year revenue growth, sustained
market share growth and margin
expansion in highly competitive
and dynamic markets.
Prior to joining Summerset,
Jarrod held senior sales and
service leadership roles with
IAG, Bayleys Real Estate, Coast
to Coast Group, and iSentia.
Scott Scoullar
Chief Financial Officer
General Manager,
Corporate Services
As Chief Financial Officer (CFO)
Scott has overall responsibility
for the financial management
of the company. Scott also leads
the corporate services area at
Summerset which includes the
Finance, Legal, Human Resources,
Property, Marketing and IT teams.
Before joining the company in 2014,
Scott held CFO roles at Housing
New Zealand and Inland Revenue.
A chartered accountant, Scott has a
background in banking and was at
National Bank in various roles for
over 12 years. He was the recipient
of NZICA’s Public Sector CFO of the
Year award for 2011, and received
a Special Commendation at the
2012 New Zealand CFO Summit
Awards. Scott is also a Fellow of CPA
Australia and a CPA New Zealand
Council Board Member.
Dean Tallentire
General Manager,
Construction
Dean joined Summerset to lead the
construction team in January 2015.
In this role Dean has responsibility
for the design and building consent
process, cost management and
tendering and construction of
Summerset’s projects.
Dean has extensive experience
in all aspects of property
development and construction.
Prior to joining Summerset,
Dean spent over a decade with
Fletcher Building in a variety of
roles, gaining experience in both
residential and commercial sectors.
EXECUTIVE TEAM PROFILES

24
OPERATIONAL
FY2016FY2015FY2014FY2013FY2012
New sales of occupation rights
414333286228167
Resales of occupation rights
244245172174164
Total sales of occupation rights
658578458402331
Development margin
22.2%20.0%15.7%13.2%12.0%
New retirement units delivered
409303261209160
Retirement units in portfolio
2,828 2,419 2,116 1,855 1,646
Care beds in portfolio
748 616 485 442 327
Key operational and financial statistics for the five year period up to and including FY2016 are as follows:
FIVE YEAR HISTORICAL SUMMARY
FINANCIAL
FY2016FY2015FY2014FY2013FY2012
Net operating cash flow ($000)
192,610140,268110,43388,59066,254
Total assets ($000)
1,706,7731,363,5401,043,189844,932702,339
Net assets ($000)
545,615409,786332,270281,912248,794
Underlying profit ($000)
56,55637,80024,42022,15415,223
Net profit before tax (IFRS) ($000)
145,63882,77553,99431,75514,414
Net profit after tax (IFRS) ($000)
145,48084,24554,17334,22314,821
Dividend per share (cents)
7.7 0 5.25 3.50 3.25 2.50
Basic earnings per share (cents)
66.9338.94 25.16 15.99 6.96
Daughter Jeanette with her mother Dorrie
in her serviced apartment, Karaka

27
SUMMERSET ANNUAL REPORT 2016
FINANCIAL STATEMENTS
INCOME STATEMENT
For the year ended 31 December 2016
NOTE
2016
$000
2015
$000
Care fees and village services
357,76946,455
Deferred management fees
328,03621,779
Interest received
3 249 523
Total revenue 86,054 68,757
Fair value movement of investment property
10143,45983,458
Total income 229,513 152,215
Operating expenses
4 (71,087) (57,337)
Depreciation and amortisation expense
8, 9 (3,736) (3,733)
Total expenses
(
74,823
)

(
61,070
)
Operating profit before financing costs154,69091,145
Net finance costs
5 (9,052) (8,370)
Profit before income tax 145,63882,775
Income tax (expense)/credit
6(158) 1,470
Profit for the period145,48084,245
Basic earnings per share (cents)
1866.93 38.94
Diluted earnings per share (cents)
1866.03 38.46
Net tangible assets per share (cents)
18249.90 188.52
The accompanying notes form part of these financial statements.

2928
SUMMERSET ANNUAL REPORT 2016
STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2016

NOTE
2016
$000
2015
$000
Profit for the period 145,480 84,245
Fair value movement of interest rate swaps
13 (1,769) (2,109)
Tax on items of other comprehensive income
6 496 592
Other comprehensive income which will be reclassified subsequently to
profit or loss for the period net of tax
(1,273) (1,517)
Total comprehensive income for the period144,207 82,728
The accompanying notes form part of these financial statements.
STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2016
SHARE
CAPITAL
$000
HEDGING
RESERVE
$000
REVALUATION
RESERVE
$000
RETAINED
EARNINGS
$000
TOTAL
EQUITY
$000
As at 1 January 2015 240,946
(
730
)
11,043 81,011 332,270
Profit for the period
- - - 84,245 84,245
Other comprehensive income for the period
- (1,517) - - (1,517)
Total comprehensive income for the period
-

(
1,517
)
- 84,245 82,728
Dividends paid
- - - (8,575) (8,575)
Shares issued
3,018 - - - 3,018
Employee share plan option cost
345 - - - 345
As at 31 December 2015 244,309
(
2,247
)
11,043 156,681 409,786
As at 1 January 2016 244,309
(
2,247
)
11,043 156,681 409,786
Profit for the period
- - - 145,480145,480
Other comprehensive income for the period
- (1,273) - - (1,273)
Total comprehensive income for the period - (1,273) - 145,480144,207
Dividends paid
- - - (13,099) (13,099)
Shares issued
4,192 - - - 4,192
Employee share plan option cost
529 - - - 529
As at 31 December 2016 249,030
(
3,520
)
11,043 289,062545,615
The accompanying notes form part of these financial statements.

3130
SUMMERSET ANNUAL REPORT 2016
James Ogden
Director and Chairman
of the Audit Committee
Rob Campbell
Director and Chairman of the Board
On behalf of the Board
Authorised for issue on 22 February 2017
STATEMENT OF FINANCIAL POSITION
As at 31 December 2016

NOTE
2016
$000
2015
$000
Assets
Cash and cash equivalents
8,654 6,682
Trade and other receivables
715,36916,074
Limited recourse loans
19, 20 - 1,520
Property, plant and equipment
889,82577,041
Intangible assets
9 1,562 1,052
Investment property
101,591,3631,261,170
Total assets1,706,7731,363,539
Liabilities
Trade and other payables
1134,68728,520
Employee benefits
125,0024,314
Revenue received in advance
329,51920,291
Interest rate swaps
134,890 3,122
Residents’ loans
14801,327637,200
Interest-bearing loans and borrowings
15273,976248,211
Deferred tax liability
611,75712,095
Total liabilities1,161,158953,753
Net assets545,615409,786
Equity
Share capital
17249,030244,309
Reserves
177,5238,796
Retained earnings
289,062 156,681
Total equity attributable to shareholders545,615409,786
The accompanying notes form part of these financial statements.
STATEMENT OF CASH FLOWS
For the year ended 31 December 2016
2016
$000
2015
$000
Cash flows from operating activities
Receipts from residents for care fees and village services
57,208 46,444
Interest received
249 523
Payments to suppliers and employees
(68,563) (56,970)
Receipts for residents’ loans
261,762 208,878
Repayment of residents’ loans
(58,046) (58,607)
Net cash flow from operating activities 192,610 140,268
Cash flows from investing activities
Purchase and construction of investment property
(177,526) (200,091)
Purchase and construction of property, plant and equipment (including care facilities)
(16,290) (20,560)
Purchase of intangible assets
(1,013) (359)
Capitalised interest paid
(5,028) (1,745)
Net cash flow from investing activities
(
199,857
)

(
222,755
)
Cash flows from financing activities
Net proceeds from borrowings
25,764 97,392
Repayment of limited recourse loans
1,520 -
Proceeds from issue of shares
4,192 3,018
Interest paid on borrowings
(9,158) (7,556)
Dividends paid
(13,099) (8,575)
Net cash flow from financing activities 9,219 84,279
Net increase in cash and cash equivalents
1,972 1,792
Cash and cash equivalents at beginning of period
6,682 4,890
Cash and cash equivalents at end of period 8,654 6,682
The accompanying notes form part of these financial statements.
In 2016 deferred management fees received have been reclassified from receipts for residents’ loans to net-off the repayment of
residents’ loans. The comparative year has been restated to align to this classification. Other comparative cash flows have been
restated where appropriate to better reflect the nature of the transactions.

3332
SUMMERSET ANNUAL REPORT 2016
1 SUMMARY OF ACCOUNTING POLICIES
Reporting entity
The financial statements presented are for Summerset Group Holdings Limited (‘ The Company’) and its subsidiaries (collectively,
‘ The Group’).
Summerset Group Holdings Limited is registered in New Zealand under the Companies Act 1993 and is a FMC Reporting Entity for
the purposes of the Financial Markets Conduct Act 2013. The reporting entity is listed on the New Zealand Stock Exchange (NZX),
being the primary exchange, and on the Australian Securities Exchange (ASX) as a foreign exempt listing.
Basis of preparation
These consolidated financial statements have been prepared in accordance with generally accepted accounting practice in New
Zealand (NZ GAAP) and the Financial Markets Conduct Act 2013. They comply with New Zealand equivalents to International
Financial Reporting Standards (NZ IFRS) as appropriate for profit-oriented entities, and with International Financial Reporting
Standards.
These financial statements are expressed in New Zealand dollars, which is Summerset’s functional currency. All financial
information has been rounded to the nearest thousand, unless otherwise stated.
The measurement basis adopted in the preparation of these financial statements is historical cost with the exception of the items
noted below.
• Interest rate swaps – Note 13
• Investment property – Note 10
• Land and buildings – Note 8
Basis of consolidation
Subsidiaries are fully consolidated at the date on which the Group obtains control, and continue to be consolidated until the
date when such control ceases. The financial statements are prepared for the same reporting period as the parent company,
Summerset Group Holdings Limited, using consistent accounting policies. All intra-group transactions and balances arising
within the Group are eliminated in full.
All subsidiary companies are 100% owned and incorporated in New Zealand with a balance date of 31 December.
The subsidiaries are:
RECONCILIATION OF OPERATING RESULTS AND OPERATING CASH FLOWS
2016
$000
2015
$000
Net profit for the period145,48084,245
Adjustments for:
Depreciation and amortisation expense
3,736 3,733
(Gain)/loss on disposal of property, plant and equipment
(37) 255
Fair value movement of investment property
(143,459) (83,458)
Net finance costs paid
9,052 8,370
Deferred tax expense/(credit)
158 (1,470)
Deferred management fee amortisation
(28,036) (21,779)
Employee share plan option cost
529 345
(
158,057
)

(
94,004
)
Movements in working capital
Increase/(decrease) in trade and other receivables
906 (1,155)
Increase in employee benefits
688 1,766
Increase/(decrease) in trade and other payables
1,456 (1,501)
Increase in residents’ loans net of non-cash amortisation
202,137 150,917
205,187 150,027
Net cash flows from operating activities 192,610 140,268
The accompanying notes form part of these financial statements.
Summerset Care LimitedSummerset Villages (Havelock North) LimitedSummerset Villages (Paraparaumu) Limited
Summerset Holdings LimitedSummerset Villages (Hobsonville) LimitedSummerset Villages (Parnell) Limited
Summerset LTI Trustee LimitedSummerset Villages (Karaka) LimitedSummerset Villages (Richmond) Limited
Summerset Management Group LimitedSummerset Villages (Katikati) LimitedSummerset Villages (Rototuna) Limited
Summerset Properties LimitedSummerset Villages (Levin) LimitedSummerset Villages (St Johns) Limited
Summerset Villages (Aotea) LimitedSummerset Villages (Lower Hutt) LimitedSummerset Villages (Taupo) Limited
Summerset Villages (Casebrook) LimitedSummerset Villages (Manukau) LimitedSummerset Villages (Trentham) Limited
Summerset Villages (Dunedin) LimitedSummerset Villages (Napier) LimitedSummerset Villages (Wanganui) Limited
Summerset Villages (Ellerslie) LimitedSummerset Villages (Nelson) LimitedSummerset Villages (Warkworth) Limited
Summerset Villages (Hamilton) LimitedSummerset Villages (New Plymouth) LimitedSummerset Villages (Wigram) Limited
Summerset Villages (Hastings) LimitedSummerset Villages (Palmerston North) LimitedWelhom Developments Limited
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2016

3534
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
Accounting policies
Accounting policies that summarise the measurement basis used and are relevant to the understanding of the financial
statements are provided throughout the accompanying notes.
The accounting policies adopted have been applied consistently throughout the periods presented in these financial statements.
There are no new standards, amendments or interpretations that have been issued and are not yet effective, that are expected
to have a significant impact on the Group.
The Group adopted all mandatory new and amended NZ IFRS Standards and Interpretations. These new and amended NZ IFRS
Standards and Interpretations had a disclosure impact only on these financial statements.
NZ IFRS Standards and Interpretations that have recently been issued or amended but are not yet effective and have not been
adopted by the Group for the annual report period ending 31 December 2016 are outlined below:
NZ IFRS 15 – Revenue from contracts with customers
This standard will replace the current revenue recognition guidance in NZ IAS 18 – Revenue and NZ IAS 11 – Construction
contracts. This standard requires an entity to recognise revenue to depict the transfer of promised goods or services to
customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods
or services. The Group has yet to assess the full impact of this standard, however, the impact of this standard is not expected
to be significant for the Group.
NZ IFRS 16 – Leases
This standard will replace NZ IAS 17 – Leases. NZ IFRS 16 requires a lessee to recognise a lease liability reflecting future lease
payments and a ‘right-of-use asset’ for virtually all lease contracts. The Group has yet to assess the full impact of this standard,
however, the impact of this standard is not expected to be significant for the Group.
Critical accounting estimates and judgements
In preparing the financial statements management has made estimates and assumptions about the future that affect the
reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and
expenses during the period. Actual results may differ from those estimates.
Estimates and assumptions are regularly evaluated and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the circumstances. The principal areas of judgement
in preparing these financial statements are described in the following notes:
• Deferred management fee – Note 3
• Interest rate swaps – Note 13
• Revenue in advance – Note 3
• Valuation of investment property – Note 10
• Valuation of land and buildings – Note 8
2 SEGMENT REPORTING
The Group operates in one industry, being the provision of integrated retirement villages in New Zealand. The services provided
across all of the Group’s villages are similar, as are the type of customer and the regulatory environment. On this basis, the Group
has one reportable segment, and the Group results are the same as the results of the reportable segment. All resource allocation
decisions across the Group are made to optimise the consolidated Group’s result.
The Ministry of Health is a significant customer of the Group, as the Group derives care fee revenue in respect of eligible
government subsidised aged care residents. Fees earned from the Ministry of Health for the year ended 31 December 2016
amounted to $20.4 million (2015: $16.7 million). No other customers individually contribute a significant proportion of the
Group revenue. All revenue is earned in New Zealand.
3 REVENUE
Care fees and villages services income is recognised over the period in which the service is rendered.
Deferred management fees, which entitle residents to accommodation and the use of the community facilities within the village,
are recognised over the period of service, being the greater of the expected period of tenure or the contractual right to revenue.
The expected periods of tenure, being based on historical Summerset averages, are estimated to be seven to eight years for villas,
five years for apartments and three years for serviced apartments. Where the deferred management fees over the contractual
period exceeds the amortisation of the deferred management fee based on estimated tenure, the amount is recorded as a liability
(revenue in advance). Deferred management fees are recognised on a gross basis in the receipts for residents’ loans section of the
statement of cashflows.
Interest income is recognised in the income statement as it accrues, using the effective interest method.
4 OPERATING EXPENSES
2016
$000
2015
$000
Employee expenses
40,45532,215
Property-related expenses
11,6078,726
Other operating expenses
19,02516,396
Total operating expenses71,08757,337
Other operating expenses include:
2016
$000
2015
$000
Remuneration paid to auditors:
Audit and review of financial statements
193 184
Donations
- 4
Rent
647 451
5 NET FINANCE COSTS
Interest expense comprises interest payable on borrowings and is calculated using the effective interest rate method.
2016
$000
2015
$000
Interest on bank loans and related fees
11,491 9,655
Interest on swaps
2,312 685
Capitalised finance costs
(4,782) (1,999)
Finance charges on finance leases
31 29
Net finance costs 9,052 8,370
Borrowing costs are capitalised for property, plant and equipment (Note 8) and investment property (Note 10) if they are directly
attributable to the construction or production of a qualifying asset. Capitalisation of borrowing costs commences when the
activities to prepare the asset commence and expenditures and borrowing costs are incurred. Capitalisation of borrowing costs
continues until the assets are substantially ready for their intended use.

3736
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
6 INCOME TAX
Tax expense comprises current and deferred tax, calculated using the tax rate enacted or substantively enacted at balance date
and any adjustment to tax payable in respect of prior years. Tax expense is recognised in the income statement except when it
relates to items recognised directly in the statement of comprehensive income, in which case the tax expense is recognised in
the statement of comprehensive income.
Deferred tax expense is recognised in respect of temporary differences between the carrying amounts of assets and liabilities
in the financial statements and the amounts used for taxation purposes. A deferred tax asset is recognised only to the extent it
is probable it will be utilised. Temporary differences for the initial recognition of assets or liabilities that affect neither accounting
nor taxable profit, unless they arise from business combination, are not provided for.
Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the
Group intends to settle its current tax assets and liabilities on a net basis.
(a) Income tax recognised in income statement
2016
$000
2015
$000
Tax expense comprises:
Deferred tax relating to the origination and reversal of temporary differences
158 (1,470)
Total tax expense/(credit) reported in income statement158
(
1,470
)
The prima facie income tax expense on pre-tax accounting profit from operations reconciles to the income tax expense in the financial
statements as follows:
2016
$000

%
2015
$000

%
Profit before tax145,63882,775
Income tax using the corporate tax rate
40,779 28.0% 23,177 28.0%
Capitalised interest
(1,339)(0.9%) (560)(0.7%)
Other non-deductible expenses
148 0.1% 97 0.1%
Non-assessable investment property revaluations
(40,168)(27.6%) (23,368)(28.2%)
Other
4150.3% (565)(0.7%)
Prior period adjustments
323 0.2% (251)(0.3%)
Total income tax expense/(credit)1580.1%
(
1,470
)(
1.8%
)
(b) Amounts charged or credited to other comprehensive income
2016
$000
2015
$000
Tax expense comprises:
Fair value movement of interest rate swaps
(496) (592)
Total tax credit reported in statement of comprehensive income
(
496
)

(
592
)
(c) Imputation credit account
There were no imputation credits received or paid during the year and the balance at 31 December 2016 is nil (2015: nil).
(d) Deferred tax
The deferred tax balance comprises:
2016
$000
2015
$000
Property, plant and equipment
10,105 10,080
Investment property
16,097 12,896
Revenue in advance
(8,266) (5,681)
Interest rate swaps
(1,371) (875)
Income tax losses not yet utilised
(3,578) (3,620)
Other items
(1,230) (705)
Net deferred tax liability11,757 12,095
Movement in the deferred tax balance comprises:
BALANCE
1 JAN 2016
$000
RECOGNISED
IN INCOME
$000
RECOGNISED
IN OCI*
$000
BALANCE
31 DEC 2016
$000
Property, plant and equipment
10,080 25 - 10,105
Investment property
12,896 3,201 - 16,097
Revenue in advance
(5,681) (2,585)- (8,266)
Interest rate swaps
(875)- (496) (1,371)
Income tax losses not yet utilised
(3,620)42-(3,578)
Other items
(705)(525)-(1,230)
Net deferred tax liability 12,095 158
(
496
)
11,757
BALANCE
1 JAN 2015
$000
RECOGNISED
IN INCOME
$000
RECOGNISED
IN OCI*
$000
BALANCE IN
31 DEC 2015
$000
Property, plant and equipment
9,764 316 - 10,080
Investment property
12,248 648 - 12,896
Revenue in advance
(4,266) (1,415) - (5,681)
Interest rate swaps
(283) - (592) (875)
Income tax losses not yet utilised
(2,754) (866) - (3,620)
Other items
(552) (153) - (705)
Net deferred tax liability 14,157
(
1,470
)

(
592
)
12,095
* Other comprehensive income

3938
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
7 TRADE AND OTHER RECEIVABLES
Trade and other receivables are stated at amortised cost less impairment losses. Trade receivables are not significant on an
individual basis and are recognised initially at fair value and subsequently measured at amortised cost using the effective
interest rate, less an allowance for impairment. Impairment is assessed on an individual basis.
Sundry debtors includes amounts owing for occupation right agreements settled but not yet paid in full at balance date.
2016
$000
2015
$000
Trade receivables
2,100 1,244
Allowance for doubtful debts
(96) (43)
2,004 1,201
Prepayments
1,564 1,426
Accrued income
617 435
Sundry debtors
11,184 13,012
Total trade and other receivables 15,369 16,074
8 PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment includes care facilities, both complete and under development, and corporate assets held.
All property, plant and equipment is initially recorded at cost. Cost includes expenditure that is directly attributable to the
acquisition of the asset. The cost of self-constructed assets includes material and direct labour, and any other costs directly
attributable to bringing the asset to its working condition for its intended use.
Subsequent to initial recognition, land and buildings related to care facilities are carried at a revalued amount, which is the fair
value at the date of the revaluation less any subsequent accumulated depreciation on buildings and accumulated impairment
losses, if any, since the assets were last revalued. Plant and equipment is subsequently measured at cost less accumulated
depreciation and impairment losses, if any. Where an item of plant and equipment is disposed of, the gain or loss recognised
in the income statement is calculated as the difference between the net sales price and the carrying
amount of the asset.
Fair value is determined by reference to market-based evidence, which is the amount for which the assets could be exchanged
between a knowledgeable willing buyer and a knowledgeable willing seller in an arm’s length transaction as at the valuation date.
Any revaluation surplus is recognised in other comprehensive income unless it reverses a revaluation decrease of the same asset
previously recognised in the income statement. Any revaluation deficit is recognised in the income statement unless it directly
offsets a previous surplus in the same asset in other comprehensive income. Any accumulated depreciation at revaluation
date is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the
asset. Upon disposal, any revaluation reserve relating to the particular asset being sold is transferred to retained earnings.
Independent valuations are performed with sufficient regularity to ensure that the carrying amount does not differ materially
from the asset’s fair value at the balance sheet date.
Note 5 provides details on capitalised borrowing costs.
Depreciation is charged to the income statement on a diminishing value basis over the estimated useful lives of each item
of property, plant and equipment, with the exception of land, which is not depreciated, and buildings which are depreciated
on a straight-line basis. Depreciation methods, useful lives and residual values are reassessed at the reporting date.
Major depreciation rates are as follows:
Buildings 2%Motor vehicles 20% to 31%
Furniture and fittings 8% to 40%Plant and equipment 8% to 67%
LAND
$000
BUILDINGS
$000
MOTOR
VEHICLES
$000
PLANT AND
EQUIPMENT
$000
FURNITURE
AND
FITTINGS
$000
TOTAL
$000
Cost
Balance at 1 January 2015 3,080 55,112 2,343 6,887 2,666 70,088
Additions
- 14,120 669 3,932 2,913 21,634
Disposals
- (16) (221) (1,479) (533) (2,249)
Reclassification
- (4,900) - - - (4,900)
Balance at 31 December 2015 3,080 64,316 2,791 9,340 5,046 84,573
Additions
- 12,089 321 2,434 1,269 16,113
Disposals
- - (356) - - (356)
Reclassification
- 4,900 (1,472) (4,080) (1,533) (2,185)
Balance at 31 December 2016 3,080 81,305 1,284 7,694 4,782 98,145
Accumulated depreciation
Balance at 1 January 2015 - - 1,568 3,297 1,664 6,529
Depreciation charge for the year
- 1,228 289 1,213 335 3,065
Impairment
- - (185) (1,381) (496) (2,062)
Balance at 31 December 2015 - 1,228 1,672 3,129 1,503 7, 5 3 2
Depreciation charge for the year
- 1,522 239 1,000 471 3,232
Disposals
- - (346) - - (346)
Reclassification
- (8) (934) (854) (302) (2,098)
Balance at 31 December 2016 - 2,742 631 3,275 1,672 8,320
Carrying amounts
As at 31 December 2015 3,080 63,088 1,119 6,211 3,543 77,041
As at 31 December 2016 3,080 78,563 653 4,419 3,110 89,825

4140
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
8 PROPERTY, PLANT AND EQUIPMENT (CONTINUED)
Revaluations
An independent valuation to determine the fair value of all completed care facilities which are classified as land and buildings
was carried out as at 31 December 2014 by CBRE Limited, an independent registered valuer. Valuations are carried out every
three years unless there are indicators of a significant change in fair value. CBRE determine the fair value of all care facility
assets using an earnings-based multiple approach. Significant assumptions used in the most recent valuation include market
value per care bed of between $79,000 and $144,000 and individual unit earning capitalisation rate of between 12.25% and 15.5%.
As the fair value of land and buildings is determined using inputs that are unobservable, the Group has categorised property,
plant and equipment as Level 3 under the fair value hierarchy in accordance with NZ IFRS 13 – Fair Value Measurement.
Sensitivity analysis to significant changes in unobservable inputs within Level 3 of the hierarchy
The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy
of the entity’s portfolios of land and buildings are the capitalisation rates applied to individual unit earnings and the market
value per care bed. A significant decrease (increase) in the capitalisation rate would result in a significantly higher (lower) fair
value measurement and a significant increase (decrease) in the market value per care bed would result in a significantly higher
(lower) fair value measurement.
Reclassification
The reclassifications in 2016 relate to motor vehicles, plant and equipment and furniture and fittings that were reclassified
as investment property at 31 December 2015. The 2016 reclassifications correct the 31 December 2015 transfers from property,
plant and equipment to investment property to the appropriate classes of assets within property, plant and equipment.
Cost model
If land and buildings were measured using the cost model, the carrying amounts would be as follows:
20162015
LAND
$000
BUILDINGS
$000
TOTAL
$000
LAND
$000
BUILDINGS
$000
TOTAL
$000
Cost
3,115 73,155 76,270 3,115 61,066 64,181
Accumulated depreciation and impairment
losses
- (10,218) (10,218) - (8,696) (8,696)
Net carrying amount 3,115 62,937 66,052 3,115 52,370 55,485
Security
At 31 December 2016, care centres registered under the Retirement Villages Act 2003 are subject to a registered first mortgage in
favour of the Statutory Supervisor.
9 INTANGIBLE ASSETS
Intangible assets acquired by the Group are measured at cost less accumulated amortisation and accumulated impairment
losses. Amortisation is recognised in the income statement on a diminishing value basis over the estimated useful lives of
intangible assets from the date that they are available for use. The intangible assets are software. The major amortisation
rate is 50%.
TOTAL
$000
Cost
Balance at 1 January 2015 2,935
Additions
359
Disposals
(493)
As at 31 December 2015 2,801
Additions
1,014
As at 31 December 2016 3,815
Accumulated amortisation
Balance at 1 January 2015 1,571
Amortisation charge for the year
668
Disposals
(490)
As at 31 December 2015 1,749
Amortisation charge for the year
504
Balance at 31 December 2016 2,253
Carrying amounts
As at 31 December 2015 1,052
As at 31 December 2016 1,562

4342
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
10 INVESTMENT PROPERTY
Investment properties are held to earn rental income and for capital appreciation. They comprise land and buildings and
associated equipment and furnishings relating to independent living units, serviced apartments and common facilities in
the retirement village. Investment properties include buildings under development. Initial recognition of investment property
is at cost and it is subsequently measured at fair value with any change in fair value recognised in the income statement.
Land acquired with the intention of constructing an investment property on it is classified as investment property from the
date of acquisition.
Rental income from investment property, being deferred management fees, is accounted for as described in Note 3.
Depreciation is not charged on investment property.
Note 5 provides details on capitalised borrowing costs.

2016
$000
2015
$000
Balance at beginning of period
1,261,170 958,171
Additions
186,747 220,117
Disposals
(13) (576)
Fair value movement:
Realised
54,377 38,483
Unrealised
89,082 44,975
Total investment property 1,591,363 1,261,170
The fair value of investment property as at 31 December 2016 was determined by CBRE Limited, an independent registered
valuer. The fair value of the Group’s investment property is determined on a semi-annual basis, based on market values, being
the estimated amount for which a property could be exchanged on the date of the valuation between a willing buyer and a willing
seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and
without compulsion. To assess the fair value of the Group’s interest in the village, CBRE has undertaken a cashflow analysis to
derive a net present value. There has been no change in valuation technique since the previous period.
Significant assumptions used by the valuer include a discount rate of between 13.75% and 16.0% (2015: 14.0% to 16.0%) and a
long-term nominal house price inflation rate of between 0% and 3.5% (2015: 0% to 3.5%). Other assumptions used by the valuer
include the average entry age of residents and occupancy periods of units.
The Group has deemed it is unable to reliably determine the fair value of non-land capital work in progress at 31 December 2016
and therefore is carried at cost. This equates to $122.3 million of investment property (2015: $99.5 million).
2016
$000
2015
$000
Valuation of manager’s net interest
790,036 623,970
Liability for residents’ loans
801,327637,200
Total investment property1,591,3631,261,170
As the fair value of investment property is determined using inputs that are unobservable, the Group has categorised investment
property as Level 3 under the fair value hierarchy in accordance with NZ IFRS 13 – Fair Value Measurement.
Sensitivity analysis to significant changes in unobservable inputs within Level 3 of the hierarchy
The significant unobservable inputs used in the fair value measurement categorised within Level 3 of the fair value hierarchy of
the entity’s portfolios of investment property are the discount rate, the long-term nominal house price inflation rate, the average
entry age of residents and the occupancy period of units. A significant decrease (increase) in the discount rate or the occupancy
period of units would result in a significantly higher (lower) fair value measurement and a significant increase (decrease) in the
average entry age of residents or the long-term nominal house price inflation rate would result in a significantly higher (lower)
fair value measurement.
Operating expenses
Direct operating expenses arising from investment property that generated rental income during the period amounted to $21.9
million (2015: $17.7 million). There were eight retirement units excluding work in progress (2015: 23) in investment property that
did not generate rental income during the period.
Security
At 31 December 2016, all investment property relating to registered retirement villages under the Retirement Villages Act 2003
are subject to a registered first mortgage in favour of the Statutory Supervisor to secure the Group’s obligations to the occupation
agreement holders.
11 TRADE AND OTHER PAYABLES
Trade and other payables are carried at amortised cost. Due to their short-term nature they are not discounted.

2016
$000
2015
$000
Trade payables
2,966 849
Accruals
23,458 21,848
Other payables
8,263 5,823
Total trade and other payables34,68728,520
12 EMPLOYEE BENEFITS
A provision is made for benefits accruing to employees in respect of wages, salaries, annual leave and short-term incentives when
it is probable that settlement will be required and the amount can be estimated reliably.

2016
$000
2015
$000
Holiday pay accrual
2,781 2,390
Other employee benefits
2,221 1,924
Total employee benefits5,0024,314

4544
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
13 INTEREST RATE SWAPS
The Group uses interest rate swaps to manage its risk associated with interest rate fluctuations. Interest rate swaps are initially
recognised at fair value on the date a contract is entered into and are subsequently measured at fair value on each reporting
date. The fair values of the interest rate swaps are determined based on cash flows discounted to present value using current
market interest rates.
When interest rate swaps meet the criteria for cash flow hedge accounting, the effective portion of the gain or loss on the
hedging instrument is recognised in other comprehensive income, while the ineffective portion is recognised in the income
statement. Amounts taken to reserves are transferred out of reserves and included in the measurement of the hedged
transaction when the forecast transaction occurs. When interest rate swaps do not meet the criteria for cash flow hedge
accounting, all movements in fair value of the hedging instrument are recognised in the income statement.
Under the interest rate swap agreements, the Group has a right to receive interest at variable rates and to pay interest at
fixed rates. At 31 December 2016, the Group had interest rate swap agreements in place with a total notional principal amount
of $251 million (2015: $236 million). Of the swaps in place, at 31 December 2016 $179 million (2015: $94 million) are being used
to cover approximately 65% (2015: 38%) of the loan principal outstanding. These agreements effectively change the Group’s
interest exposure on the principal covered by the interest rate swaps from a floating rate to fixed rates, which range between
3.54% and 4.47% (2015: 3.15% and 4.47%).
The fair value of these agreements at 31 December 2016 is $4.9 million liability, comprised of $5.8 million of swap liabilities
and $0.9 million swap assets (2015: liability of $3.1 million, comprised of $3.9 million swap liabilities and $0.8 million swap assets).
Of this, a liability of $264,000 (2015: $134,000) is estimated to be current. The agreements cover notional amounts for a term of
between one and ten years.
The notional principal amounts and the period of expiry of the interest rate swap contracts are as follows:


2016
$000
2015
$000
Less than 1 year
22,000 30,000
Between 1 and 2 years
27,000 22,000
Between 2 and 3 years
37,000 27,000
Between 3 and 4 years
40,000 37,000
Between 4 and 5 years
25,000 30,000
Between 5 and 6 years
30,000 10,000
Between 6 and 7 years
10,000 30,000
Between 7 and 8 years
20,000 10,000
Between 8 and 9 years
25,000 20,000
Between 9 and 10 years
15,000 20,000
Total251,000236,000
14 RESIDENTS’ LOANS
An occupation right agreement confers a right of occupancy to a villa, apartment or serviced apartment. The consideration
received on the grant of an occupation right agreement is allocated to the resident’s loan in full. Residents’ loans are amounts
payable under occupation right agreements. These loans are non-interest-bearing and are payable when both an occupation
right agreement is terminated and there has been settlement of a new occupation right agreement for the same retirement unit
and the proceeds from the new settlement have been received by the Group. Residents’ loans are initially recognised at fair value
and subsequently measured at amortised cost.
The Group holds a contractual right to set-off the deferred management fee receivable on termination of an agreement against
the resident’s loan to be repaid. Residents’ loans are therefore recognised net of the deferred management fee receivable on
the balance sheet. Deferred management fees are payable by residents in consideration for the supply of accommodation and
the right to share in the use of community facilities. Deferred management fees are paid in arrears with the amount payable
calculated as a percentage of the resident’s loan amount as per the resident’s occupation right agreement. Deferred management
fee receivable is calculated and recorded based on the current tenure of the resident and the contractual right to deferred
management fee earned at balance date. Refer to Note 3 for further detail on recognition of deferred management fee revenue.

2016
$000
2015
$000
Balance at beginning of period
732,578 574,718
Amounts repaid on termination of occupation right agreements
(69,492) (51,018)
Amounts received on issue of new occupation right agreements
261,762 208,878
Total gross residents’ loans 924,848 732,578
Deferred management fees receivable
(
123,521
)

(
95,378
)
Total residents’ loans 801,327 637,200
Note 16 provides a split between current and non-current residents’ loans.
15 INTEREST-BEARING LOANS AND BORROWINGS
As at 31 December 2016, secured bank loans totalled $274.0 million (2015: $248.2 million).
Interest-bearing loans and borrowings are recognised initially at fair value net of directly attributable transaction costs, with
any difference between cost and redemption value being recognised in the income statement over the period of the borrowings
using the effective interest rate basis.
The weighted average interest rate for the year to 31 December 2016 was 3.58% (2015: 3.59%). This includes the impact of interest
rate swaps (see Note 13).
The secured bank loan facility at 31 December 2016 has a maximum of $450.0 million (2015: $450.0 million). Lending of $125.0
million expires in August 2018 and $325.0 million of lending expires in August 2020.
Security
The bank loans are secured by a general security agreement over the assets of Summerset Holdings Limited (a subsidiary of the
Company) subject to a first priority to the Statutory Supervisor over the village assets.

4746
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
16 FINANCIAL INSTRUMENTS
Exposure to credit, market and liquidity risk arises in the normal course of the Group’s business. The Board reviews and agrees
on policies for managing each of these risks as summarised below. The Group has no exposure to foreign currency or any other
substantial market price risk.
Categories of financial instruments
All financial assets are classified as loans and receivables except for limited recourse loans which are designated as fair value
through profit or loss and interest rate swaps which are classified as derivatives held for trading. All financial liabilities except
interest rate swaps are classified as liabilities at amortised cost.
Credit risk
Credit risk is the risk of financial loss to the Group if a resident or counterparty to a financial instrument fails to meet their
contractual obligations. The Group’s exposure to credit risk relates to receivables from residents and bank balances. The Group
manages its exposure to credit risk. The Group’s cash is held with its principal banker, with the level of exposure to credit risk
considered minimal with low levels of cash generally held. Receivables balances are monitored on an ongoing basis and funds
are placed with high-credit-quality financial institutions. The level of risk associated with sundry debtors is considered minimal.
The Group does not require collateral from its debtors and the Directors consider the Group’s exposure to any concentration of
credit risk to be minimal.
The carrying amount of financial assets represents the Group’s maximum credit exposure. The status of trade receivables is as
follows:
20162015
GROSS
RECEIVABLE
$000
IMPAIRMENT
$000
GROSS
RECEIVABLE
$000
IMPAIRMENT
$000
Not past due
1,797 - 1,041 -
Past due 31 to 60 days
162 - 101 -
Past due 61 to 90 days
47 (2) 46 -
Past due more than 90 days
94 (94) 56 (43)
Total 2,100
(
96
)
1,244
(
43
)
In summary, trade receivables are determined to be impaired as follows:
2016
$000
2015
$000
Gross trade receivables
2,100 1,244
Impairment
(96) (43)
Net trade receivables 2,004 1,201
All amounts past due but not impaired have been reviewed and are considered recoverable.
Market risk
Market risk is the risk that changes in market prices such as interest rates will affect the Group’s income. The objective of
market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the
return on risk.
Interest rate risk
The Group’s exposure to interest rate risk is managed by seeking to obtain the most competitive rate of interest at all times.
The Group has also entered into interest rate swap agreements in order to provide an effective cash flow hedge against the
variability in floating interest rates. See Note 13 for details of the interest rate swap agreements.
At 31 December 2016 it is estimated that a general increase of one percentage point in interest rates would decrease the
Group’s profit before income tax by $2.6 million (2015: decrease by $2.4 million) and decrease total comprehensive income by
approximately $0.9 million (2015: decrease by $1.5 million).
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group manages
liquidity by maintaining adequate reserves and undrawn banking facilities by continuously monitoring forecast and actual
cash flows and matching the maturity profiles of financial assets and liabilities. The Group manages liquidity risk on residents’
loans and related sundry debtors through the contractual requirements of occupation rights agreements, whereby a resident’s
loan is only repaid on receipt of the loan monies from the incoming resident.
The following table sets out the contractual cash flows for all financial liabilities for the Group (including contractual interest
obligations on bank loans):
20162015
LESS THAN
1 YEAR
$000
GREATER THAN
1 YEAR
$000
LESS THAN
1 YEAR
$000
GREATER THAN
1 YEAR
$000
Financial liabilities
Trade and other payables
34,687-28,520-
Residents’ loans
53,339 747,988 55,287581,913
Interest-bearing loans and borrowings
9,809313,20910,127288,719
Interest rate swaps
42 17,147249,970
Total 97,8771,078,34493,958880,602
Residents’ loans are non-interest bearing and are not required to be repaid following termination of an occupation right
agreement until receipt of cash for the new resident loan from the incoming resident. The figures above have been calculated
using best estimates of resident loan repayments based on historical information. To date, cash for new residents’ loans
received has always exceeded cash from repaid residents’ loans, net of deferred management fees.

4948
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
16 FINANCIAL INSTRUMENT (CONTINUED)
Fair values
The carrying amounts shown in the balance sheet approximate the fair value of the financial instruments, with the exception
of residents’ loans, shown below:

20162015
CARRYING
AMOUNT
$000
FAIR VALUE
$000
CARRYING
AMOUNT
$000
FAIR VALUE
$000
Residents’ loans
(801,327) (510,959) (637,200) (401,150)
Total
(
801,327
)

(
510,959
)

(
637,200
)

(
401,150
)
The fair value of residents’ loans is based on the present value of projected cash flows. Future cash flows are based on the
assumption that the average tenure periods are those disclosed above and have been discounted at 14% (2015: 14%). The fair
value of residents’ loans is categorised as Level 3 under the fair value hierarchy in accordance with NZ IFRS 13 – Fair Value
Measurement.
The fair value of interest rate swaps are determined using inputs from third parties that are observable, either directly (i.e. as
prices) or indirectly (i.e. derived from prices). Based on this, the Company and Group has categorised these financial instruments
as Level 2 under the fair value hierarchy in accordance with NZ IFRS 13 – Fair Value Measurement.
Capital management
The Group’s capital includes share capital, reserves and retained earnings. The objective of the Group’s capital management is
to ensure a strong credit rating to support business growth and maximise shareholder value. The Group’s capital is managed
through Summerset Holdings Limited and its subsidiaries (“SHL Group”). The SHL Group is subject to capital requirements
imposed by the bank through the Group Deed of Covenant. The SHL Group has met all externally imposed capital requirements
for the year ended 31 December 2016 (2015: all requirements met). The SHL Group capital structure is managed, and adjustments
are made, with Board approval. There were no changes to objectives, policies or processes during the year ended 31 December
2016 (2015: The Group’s Treasury policy was changed to increase the maximum tenure for hedging instruments and adjust the
spreading of maturities permitted for these).
17 SHARE CAPITAL AND RESERVES
At 31 December 2016, there were 221,337,808 ordinary shares on issue (2015: 220,263,506). All ordinary shares are fully paid and
have no par value. All shares carry one vote per share and carry the right to dividends.
2016
$000
2015
$000
Share capital
On issue at beginning of year
244,309240,946
Shares issued under the dividend reinvestment plan
4,1592,671
Other
33-
Shares paid under employee share plan
- 347
Employee share plan option cost
529 345
On issue at end of year249,030244,309
20162015
Share capital (in thousands of shares)
On issue at beginning of year
216,817215,815
Shares issued under the dividend reinvestment plan
892770
Shares issued under the employee share plan
- 232
On issue at end of year217,709216,817
The total shares on issue at 31 December 2016 of 221,337,808 for Summerset Group Holdings Limited differs from the share capital
for the Group due to shares held in 100% owned subsidiary, Summerset LTI Trustee Limited. As at 31 December 2016, 3,629,248
shares are held by Summerset LTI Trustee Limited for employee share plans which are eliminated on consolidation. Refer to Note
19 for further details on employee share plans.
Revaluation reserve
The revaluation reserve is used to record the revaluation of care facility land and buildings.
Hedging reserve
The hedging reserve is used to record gains or losses on instruments used as cash flow hedges. The amounts are recognised in
profit and loss when the hedged transaction affects profit and loss.
Dividends
On 24 March 2016 a dividend of 3.4 cents per ordinary share was paid to shareholders and on 9 September 2016 a dividend of 2.6
cents per ordinary share was paid to shareholders. (2015: on 25 March 2015 a dividend of 2.1 cents per ordinary share was paid to
shareholders and on 7 September 2015 a dividend of 1.85 cents per ordinary share was paid to shareholders).
A dividend reinvestment plan applied to the dividends paid. 557,924 ordinary shares were issued in relation to the plan for the
March 2016 dividend and 333,618 ordinary shares were issued in relation to the plan for the September 2016 dividend (2015:
447,575 ordinary shares were issued in March 2015 and 322,297 ordinary shares were issued in September 2015).

5150
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
18 EARNINGS PER SHARE AND NET TANGIBLE ASSETS

20162015
Basic earnings per share
Earnings ($000)
145,480 84,245
Weighted average number of ordinary shares for the purpose of earnings
per share (in thousands)
217,352216,342
Basic earnings per share (cents per share)66.9338.94
20162015
Diluted earnings per share
Earnings ($000)
145,480 84,245
Weighted average number of ordinary shares for the purpose of earnings
per share (in thousands)
220,322219,050
Diluted earnings per share (cents per share)66.0338.46
20162015
Number of shares (in thousands)
Weighted average number of ordinary shares for the purpose of earnings
per share (basic)
217,352 216,342
Weighted average number of ordinary shares issued under employee share plans
2,9702,708
Weighted average number of ordinary shares for the purpose of earnings
per share (diluted)
220,322219,050
At 31 December 2016, there were 3,629,248 shares issued under employee share plans (Dec 2015: 3,446,488 shares).
20162015
Net tangible assets per share
Net tangible assets ($000)
544,053 408,734
Shares on issue at end of period (basic and in thousands)
217,709216,817
Net tangible assets per share (cents per share)249.90188.52
Net tangible assets is calculated as the total assets of the Group minus intangible assets and minus total liabilities. This measure
is provided as it is a commonly calculated figure and is useful for comparison with other entities.
19 EMPLOYEE SHARE PLAN
Senior employee share plan
The Group operates employee share plans for selected senior employees (“Participants”) to purchase shares in Summerset Group
Holdings Limited. The shares for the plans are held by a nominee on behalf of Participants, until such time after the vesting
of shares that the nominee is directed by the Participant to transfer or sell the shares, or the shares are sold by the nominee if
vesting criteria are not met. The shares carry the same rights as all other ordinary shares.
The Group has provided Participants with interest-free limited recourse loans to fund the acquisition of the shares for these
plans. These loans are held by Summerset LTI Trustee Limited and eliminate on consolidation.
The issue price of shares under the 2011 plan was determined using the offer price on the company’s NZX listing on 1 November
2011. The issue price of shares under the 2013 plan is determined from the volume weighted average price on the NZX during the
ten trading days prior to issue.
2011
SHARE PLAN
2013
SHARE PLAN
(
2013 ISSUES
)
2013
SHARE PLAN
(
2014 ISSUE
)
2013
SHARE PLAN
(
2015 ISSUE
)
2013
SHARE PLAN
(
2016 ISSUE
)
Commencement date
1 Nov 2011 16 Dec 2013 16 Dec 2013 16 Dec 2013 16 Dec 2013
Issue price
$1.40$3.20 & $3.47$2.68$3.91$4.76
Expiry date of interest-free
limited recourse loans
31 Oct 2017 30 Jun 2018 30 Jun 2019 30 Jun 2020 30 Jun 2021
Years that the performance goals
relate to
2012 to 2013 2014 to 2016 2015 to 2017 2016 to 2018 2017 to 2019
% of shares vested
100%25%
1
42%
1
0%0%
Vesting date of final tranche
31 Dec 2013 31 Dec 2016 31 Dec 2017 31 Dec 2018 31 Dec 2019
The performance hurdles for each grant of shares under the 2013 share plan between 2013 and 2015 to executive team members
(CEO and direct reports) are based on the Group’s total shareholder return relative to the performance of relevant peers and the
NZX 50.
The performance hurdles for the grant of shares under the 2013 share plan in 2016 to executive team members are based on:
• 50% absolute earnings (cumulative actual underlying net profit after tax for the Group against budget)
• 25% relative earnings (earnings per share growth of the Group compared to a defined peer group)
• 10% employee initiatives
• 10% customer initiatives
• 5% clinical strategy initiatives
There are no performance hurdles for grants of shares to senior management team members other than members of the
executive team, whose hurdles are described above.
750,000 shares were vested and eligible for exercise at 31 December 2016 (2015: 750,000). The exercise price was $1.40 (2015: $1.40).
An additional 590,831 shares were vested on 31 December 2016 but are not eligible for exercise until 24 February 2017.
1
Vesting date 31 December 2016, release date 24 February 2017.

5352
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
19 EMPLOYEE SHARE PLAN (CONTINUED)
The share plans are equity-settled schemes and are measured at fair value at the date of the grant. The fair value determined
at the grant date of the equity-settled share-based payments is expensed over the vesting period, based on the Group’s estimate
that the shares will vest. These options were valued using the Black Scholes valuation model and the option cost for the year
ending 31 December 2016 of $490,000 has been recognised in the income statement of the Company and the Group for that
period (2015: $345,000).
20162015
2011
SHARE
PLAN
2013
SHARE
PLAN
(
2013
ISSUES
)
2013
SHARE
PLAN
(
2014
ISSUES
)
2013
SHARE
PLAN
(
2015
ISSUES
)
2013
SHARE
PLAN
(
2016
ISSUES
)
2011
SHARE
PLAN
2013
SHARE
PLAN
(
2013
ISSUES
)
2013
SHARE
PLAN
(
2014
ISSUES
)
2013
SHARE
PLAN
(
2015
ISSUES
)
Shares held at year end
(in thousands)
750283723893868750678769945
Share plan shares held at year end
as a percentage of shares on issue
0.3%0.1%0.3%0.4%0.4%0.3%0.3%0.3%0.4%
Valuation assumptions
Discount to reflect shares
may not meet vesting criteria
20%30%30%0-30%0-15%20%30%30%0-30%
Volatility
20%21-22%21%22%23%20%21-22%21%22%
790,125 shares that did not meet vesting criteria were cancelled under the 2013 Share Plan on 12 April 2016. The range of exercise
prices at 31 December 2016 is $1.40 to $4.76 (2015: $1.40 to $3.91).
20162015
WEIGHTED
AVERAGE
EXERCISE PRICE
NUMBER
OF SHARES
000’S
WEIGHTED
AVERAGE
EXERCISE PRICE
NUMBER
OF SHARES
000’S
Balance at beginning of the period
$2.89 3,142 $2.40 2,734
Issued during the year
$4.76 868 $3.91 945
Issued to employees following
vesting and repayment of loans
- - $1.50 (232)
Forfeited during the year
$3.26 (492)$2.88 (305)
Balance at end of the period$3.30 3,518 $2.89 3,142
All staff employee share plan
The Group implemented an all staff employee share plan in 2016 to better align employee and shareholder interests. A total of 626
employees participated in the plan for the year ending 31 December 2016. The Group contributed $779 per participating employee.
A total of 104,542 Summerset shares were issued under the scheme at $4.66 per share. The shares are held by Summerset LTI
Trustee Limited and vest to participating employees after a three-year period.
The option cost for the year ending 31 December 2016 of $39,000 has been recognised in the income statement of the Company
and the Group for that period (2015: nil).
20 RELATED PARTY TRANSACTIONS
The Group has no loans to employees’ receivable at 31 December 2016 (2015: $1.5 million). Refer to Note 19 for employee share plan
details.
Certain Summerset Directors have relevant interests in a number of companies that we have transactions with in the normal
course of business. A number of Directors are also non-executive Directors of other companies. Any transactions undertaken
with these entities are in the ordinary course of business.
21 KEY MANAGEMENT PERSONNEL COMPENSATION
The compensation of the key management personnel of the Group is set out below:
2016
$000
2015
$000
Directors’ fees
508 538
Short-term employee benefits
2,548 2,596
Share-based payments
429 345
Termination payments
- 337
Total 3,4853,816
Refer to Note 19 for employee share plan details for key management personnel and Note 20 for loans advanced to key
management personnel.

5554
SUMMERSET ANNUAL REPORT 2016
NOTES TO THE FINANCIAL STATEMENTS
(continued)
22 COMMITMENTS AND CONTINGENCIES
Operating lease commitments
Non-cancellable operating lease rentals are payable as follows:
2016
$000
2015
$000
Less than 1 year
1,074 398
Between 1 and 5 years
6,151 2,287
More than 5 years
7,183 4,068
Total operating lease commitments 14,408 6,753
During the year ended 31 December 2016, $0.6 million was recognised in the income statement in respect of operating leases
(2015: $0.5 million).
Guarantees
At 31 December 2016, NZX Limited held a guarantee in respect of the Group, as required by the NZX Listing Rules, for $75,000
(2015: $75,000).
Capital commitments
At 31 December 2016, the Group had $73.8 million of capital commitments in relation to construction contracts
(2015: $51.1 million).
Contingent liabilities
There were no known material contingent liabilities at 31 December 2016 (2015: nil).
23 SUBSEQUENT EVENTS
On 22 February 2017, the Directors approved a final dividend of $11.3 million, being 5.1 cents per share. The dividend record date is
9 March 2017 with a payment date of 22 March 2017.
There have been no other events subsequent to 31 December 2016 that materially impact on the results reported (2015: nil).
INDEPENDENT AUDITOR’S REPORT TO THE SHAREHOLDERS
OF SUMMERSET GROUP HOLDINGS LIMITED
REPORT ON THE AUDIT OF THE FINANCIAL STATEMENTS
Opinion
We have audited the consolidated financial statements of Summerset Group Holdings Limited (“the company”) and its
subsidiaries (together “the group”) on pages 27 to 54, which comprise the statement of financial position of the group as at
31 December 2016, and the income statement, statement of comprehensive income, statement of changes in equity and
statement of cash flows for the year then ended of the group, and the notes to the consolidated financial statements including
a summary of significant accounting policies.
In our opinion, the consolidated financial statements on pages 27 to 54 present fairly, in all material respects, the financial
position of the group as at 31 December 2016 and its financial performance and cash flows for the year then ended in accordance
with New Zealand equivalents to International Financial Reporting Standards and International Financial Reporting Standards.
This report is made solely to the company’s shareholders, as a body. Our audit has been undertaken so that we might state to the
company’s shareholders those matters we are required to state to them in an auditor’s report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s
shareholders as a body, for our audit work, for this report, or for the opinions we have formed.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand). Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report.
We are independent of the group in accordance with Professional and Ethical Standard 1 (revised) Code of Ethics for Assurance
Practitioners issued by the New Zealand Auditing and Assurance Standards Board, and we have fulfilled our other ethical
responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Other than in our capacity as auditor we have no relationship with, or interest in, Summerset Group Holdings Limited or any
of its subsidiaries. Partners and employees of our firm may deal with the group on normal terms within the ordinary course of
trading activities of the business of the group.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated
financial statements of the current year. These matters were addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, but we do not provide a separate opinion on these matters. For each
matter below, our description of how our audit addressed the matter is provided in that context.
We have fulfilled the responsibilities described in the Auditor’s responsibilities for the audit of the financial statements section
of the audit report, including in relation to these matters. Accordingly, our audit included the performance of procedures
designed to respond to our assessment of the risks of material misstatement of the financial statements. The results of our audit
procedures, including the procedures performed to address the matters below, provide the basis for our audit opinion on the
accompanying consolidated financial statements.
Chartered Accountants

Independent A uditor's Report
To
the Shareholders of Summerset Group H oldings Limited
R
eport on the Financial Statements
We have audited the financial statements of Summerset Group Holdings Limited (the “company”)
and its subsidiaries (“the group”) on pages 2 to 24, which comprise the statement of financial
position of the group as at 31 December 2015, and the statement of comprehensive income, income
statement, statement of changes in equity and statement of cash flows for the year then ended of
the group, and a summary of significant accounting policies and other explanatory information.
This report is made solely to the company's shareholders as a body. Our audit has been undertaken
so that we might state to the company's shareholders those matters we are required to state to
them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do
not accept or assume responsibility to anyone other than the company and the company's
shareholders as a body, for our audit work, for this report, or for the opinions we have formed.
Directors’ Responsibility for the Financial Statements
The directors are responsible on behalf of the company for the preparation and fair presentation of
the financial statements in accordance with New Zealand Equivalents to International Financial
Reporting Standards and International Financial Reporting Standards, and for such internal control
as the directors determine is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
A uditor's Responsibility
Our responsibility is to express an opinion on the financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing (New Zealand). These
auditing standards require that we comply with relevant ethical requirements and plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on our judgement,
including the assessment of the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, we have considered the internal control
relevant to the entity’s preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates, as well as evaluating the overall presentation of the financial statements.
We believe we have obtained sufficient and appropriate audit evidence to provide a basis for our
audit opinion.
Other than in our capacity as auditor we have no relationship with, or interest in, the group.
Partners and employees of our firm may deal with the group on normal terms within the ordinary
course of trading activities of the business of the group.
Opinion
In our opinion, the financial statements on pages 2 to 24 present fairly, in all material respects, the
financial position of the group as at 31 December 2015 and the financial performance and cash
flows of the group for the year then ended in accordance with New Zealand Equivalents to
International Financial Reporting Standards and International Financial Reporting Standards.



23 February 2016
Wellington

5756
SUMMERSET ANNUAL REPORT 2016
Valuation of investment properties
WHY SIGNIFICANT?HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Summerset’s retirement village assets (excluding care
facilities) are recorded as Investment Property and account
for 93% of total assets.
Investment Properties are carried at fair value. The group
engages an independent registered valuer to determine the
fair value of investment properties at balance date.
The valuation requires the use of judgement specific to
each of the properties. Significant input assumptions used
in the valuation are subjective and are not observable
through available market information. These assumptions
are the discount rate, the forecast long-term nominal house
price inflation, the average entry age of residents and the
expected occupancy period of the units for each property.
The valuation approach and significant assumptions are
described in Note 10 Investment Property to the
consolidated financial statements.
Investment properties are recorded at the value determined
by the valuer, adjusted for gross residents’ loans and deferred
management fees receivable which are recognised separately
on the statement of financial position but reflected in the cash
flow model to determine each village’s valuation.
Our work focused on understanding the overall valuation
methodology for compliance with NZ IFRS 13 Fair Value
Measurement and evaluating significant inputs. In
obtaining sufficient audit evidence, we:
• assessed the qualifications, independence and
objectivity of the external valuer;
• assessed and discussed the valuation reports with the
independent valuer;
• tested, on a sample basis, village specific information
supplied to the external valuer by Summerset to the
underlying records held by the group;
• assessed the significant input assumptions applied,
being the discount rate, the forecast long-term nominal
house price inflation, the average entry age of residents
and the expected occupancy period of the units for
each property, and valuation outcomes for each
property evaluated against the rest of the portfolio
and the retirement village sector;
• involved our real estate valuation specialists to assist
us in analysing the valuations and evaluating the
underlying assumptions;
• considered the impact of new development work
and the completeness of the assets included in the
valuation; and
• assessed the adequacy of the related financial
statement disclosures.
Recognition and Measurement of Capital Work in Progress
WHY SIGNIFICANT?HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Summerset has a significant village development programme.
Additions to investment property during the 2016 year
totalled $187 million comprising land, materials, labour and
other directly attributable costs.
The capitalisation of development costs is considered a
key audit matter as judgement is applied by the group to
identify and measure directly attributable costs. Alternative
judgements could lead to different profit and work in progress
balances being reported in the financial statements.
Summerset records non-land work in progress at cost, as
it has determined it is unable to measure the fair value of
construction whilst in progress. Non-land work in progress
of $123 million, representing 7% of total assets, was included
in the balance of Investment Property as described in Note 10
Investment Property to the consolidated financial statements.
The balance of work in progress carried at cost is tested for
indicators of impairment at the end of each six month period.
Our work on capitalised development costs focused on
the group’s process for identifying and recording directly
attributable costs, including allocations of head office
costs and capitalised interest. In obtaining sufficient
audit evidence for each component we:
• evaluated the group’s estimate of head office costs
directly attributable to development activities;
• tested, on a sample basis, capital costs incurred;
• assessed the judgements made in relation to the
timing of recognition of property acquisitions and the
measurement of incomplete property at balance date;
• considered the attribution of costs from work in
progress to completed village units, care facilities
and other assets; and
• evaluated the group’s review of work in progress
at balance date for impairment.

Deferred Management Fee Revenue Recognition
WHY SIGNIFICANT?HOW OUR AUDIT ADDRESSED THE KEY AUDIT MATTER
Deferred management fee revenue is 33% of Summerset’s total
revenue. Summerset recognises deferred management fee
revenue from residents over the longer of the expected period
of tenure or the contractual right to revenue in accordance
with the terms of the resident’s occupational right agreement.
The amount of revenue recognised in each year is subject to
the group’s judgement of each residents’ expected tenure in
the village, the terms of the occupational right agreement
and the type of unit occupied.
Deferred management fee revenue and the associated
deferred management fee receivable and revenue in advance
balances are discussed in Note 3 Revenue to the consolidated
financial statements.
Our work focused on understanding the overall
calculation methodology and testing the integrity of
inputs and key assumptions to revenue recognition
throughout the period. In doing so, we:
• assessed the accuracy of the inputs to, and calculation
of, deferred management fee revenue recognised
during 2016;
• agreed the contractual terms of a sample of residents
used in the revenue recognition calculation to the
occupational right agreement;
• compared the movements year on year in revenue
recognised by village and unit type based on an
expectation derived from the nature of the population
of occupational right agreements; and
• considered the group’s assessment of assumed
tenure against actual observed tenure.
Chartered Accountants

Independent A uditor's Report
To
the Shareholders of Summerset Group H oldings Limited
R
eport on the Financial Statements
We have audited the financial statements of Summerset Group Holdings Limited (the “company”)
and its subsidiaries (“the group”) on pages 2 to 24, which comprise the statement of financial
position of the group as at 31 December 2015, and the statement of comprehensive income, income
statement, statement of changes in equity and statement of cash flows for the year then ended of
the group, and a summary of significant accounting policies and other explanatory information.
This report is made solely to the company's shareholders as a body. Our audit has been undertaken
so that we might state to the company's shareholders those matters we are required to state to
them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do
not accept or assume responsibility to anyone other than the company and the company's
shareholders as a body, for our audit work, for this report, or for the opinions we have formed.
Directors’ Responsibility for the Financial Statements
The directors are responsible on behalf of the company for the preparation and fair presentation of
the financial statements in accordance with New Zealand Equivalents to International Financial
Reporting Standards and International Financial Reporting Standards, and for such internal control
as the directors determine is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
A uditor's Responsibility
Our responsibility is to express an opinion on the financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing (New Zealand). These
auditing standards require that we comply with relevant ethical requirements and plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on our judgement,
including the assessment of the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, we have considered the internal control
relevant to the entity’s preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates, as well as evaluating the overall presentation of the financial statements.
We believe we have obtained sufficient and appropriate audit evidence to provide a basis for our
audit opinion.
Other than in our capacity as auditor we have no relationship with, or interest in, the group.
Partners and employees of our firm may deal with the group on normal terms within the ordinary
course of trading activities of the business of the group.
Opinion
In our opinion, the financial statements on pages 2 to 24 present fairly, in all material respects, the
financial position of the group as at 31 December 2015 and the financial performance and cash
flows of the group for the year then ended in accordance with New Zealand Equivalents to
International Financial Reporting Standards and International Financial Reporting Standards.



23 February 2016
Wellington

5958
SUMMERSET ANNUAL REPORT 2016
Chartered Accountants

Independent A uditor's Report
To
the Shareholders of Summerset Group H oldings Limited
R
eport on the Financial Statements
We have audited the financial statements of Summerset Group Holdings Limited (the “company”)
and its subsidiaries (“the group”) on pages 2 to 24, which comprise the statement of financial
position of the group as at 31 December 2015, and the statement of comprehensive income, income
statement, statement of changes in equity and statement of cash flows for the year then ended of
the group, and a summary of significant accounting policies and other explanatory information.
This report is made solely to the company's shareholders as a body. Our audit has been undertaken
so that we might state to the company's shareholders those matters we are required to state to
them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do
not accept or assume responsibility to anyone other than the company and the company's
shareholders as a body, for our audit work, for this report, or for the opinions we have formed.
Directors’ Responsibility for the Financial Statements
The directors are responsible on behalf of the company for the preparation and fair presentation of
the financial statements in accordance with New Zealand Equivalents to International Financial
Reporting Standards and International Financial Reporting Standards, and for such internal control
as the directors determine is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
A uditor's Responsibility
Our responsibility is to express an opinion on the financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing (New Zealand). These
auditing standards require that we comply with relevant ethical requirements and plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on our judgement,
including the assessment of the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, we have considered the internal control
relevant to the entity’s preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates, as well as evaluating the overall presentation of the financial statements.
We believe we have obtained sufficient and appropriate audit evidence to provide a basis for our
audit opinion.
Other than in our capacity as auditor we have no relationship with, or interest in, the group.
Partners and employees of our firm may deal with the group on normal terms within the ordinary
course of trading activities of the business of the group.
Opinion
In our opinion, the financial statements on pages 2 to 24 present fairly, in all material respects, the
financial position of the group as at 31 December 2015 and the financial performance and cash
flows of the group for the year then ended in accordance with New Zealand Equivalents to
International Financial Reporting Standards and International Financial Reporting Standards.



23 February 2016
Wellington

Information Other than the Financial Statements and Auditor’s Report
The directors of the company are responsible for the Annual Report, which includes information other than the consolidated
financial statements and the auditor’s report.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any form
of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or
our knowledge obtained during the audit, or otherwise appears to be materially misstated. If, based upon the work we have
performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
Directors’ Responsibilities for the Financial Statements
The directors are responsible on behalf of the entity for the preparation and fair presentation of the consolidated financial
statements in accordance with New Zealand equivalents to International Financial Reporting Standards and International
Financial Reporting Standards, and for such internal control as the directors determine is necessary to enable the preparation
of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the directors are responsible for assessing the group’s ability to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting
unless the directors either intend to liquidate the group or cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with International Standards
on Auditing (New Zealand) will always detect a material misstatement when it exists. Misstatements can arise from fraud
or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these consolidated financial statements.
A further description of the auditor’s responsibilities for the audit of the financial statements is located at External Reporting
Board’s website: https://xrb.govt.nz/Site/Auditing_Assurance_Standards/Current_Standards/Page1.aspx
This description forms part of our auditor’s report.
The engagement partner on the audit resulting in this independent auditor’s report is Stuart Mutch.
Wellington
22 February 2017
Chartered Accountants

Independent A uditor's Report
To
the Shareholders of Summerset Group H oldings Limited
R
eport on the Financial Statements
We have audited the financial statements of Summerset Group Holdings Limited (the “company”)
and its subsidiaries (“the group”) on pages 2 to 24, which comprise the statement of financial
position of the group as at 31 December 2015, and the statement of comprehensive income, income
statement, statement of changes in equity and statement of cash flows for the year then ended of
the group, and a summary of significant accounting policies and other explanatory information.
This report is made solely to the company's shareholders as a body. Our audit has been undertaken
so that we might state to the company's shareholders those matters we are required to state to
them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do
not accept or assume responsibility to anyone other than the company and the company's
shareholders as a body, for our audit work, for this report, or for the opinions we have formed.
Directors’ Responsibility for the Financial Statements
The directors are responsible on behalf of the company for the preparation and fair presentation of
the financial statements in accordance with New Zealand Equivalents to International Financial
Reporting Standards and International Financial Reporting Standards, and for such internal control
as the directors determine is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
A uditor's Responsibility
Our responsibility is to express an opinion on the financial statements based on our audit. We
conducted our audit in accordance with International Standards on Auditing (New Zealand). These
auditing standards require that we comply with relevant ethical requirements and plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on our judgement,
including the assessment of the risks of material misstatement of the financial statements, whether
due to fraud or error. In making those risk assessments, we have considered the internal control
relevant to the entity’s preparation and fair presentation of the financial statements in order to
design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting
estimates, as well as evaluating the overall presentation of the financial statements.
We believe we have obtained sufficient and appropriate audit evidence to provide a basis for our
audit opinion.
Other than in our capacity as auditor we have no relationship with, or interest in, the group.
Partners and employees of our firm may deal with the group on normal terms within the ordinary
course of trading activities of the business of the group.
Opinion
In our opinion, the financial statements on pages 2 to 24 present fairly, in all material respects, the
financial position of the group as at 31 December 2015 and the financial performance and cash
flows of the group for the year then ended in accordance with New Zealand Equivalents to
International Financial Reporting Standards and International Financial Reporting Standards.



23 February 2016
Wellington

Wigram’s new village centre

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SUMMERSET ANNUAL REPORT 2016
GOVERNANCE
Summerset is committed to following best-practice governance structures and principles and to having good governance
overseeing the way in which the Company operates. It also takes account of the Company’s listings on both NZX and ASX.
Summerset has adopted the principles below as an appropriate way to demonstrate Summerset’s compliance with these
fundamental principles and to illustrate the transparency of Summerset’s approach to corporate governance for the benefit
of its Shareholders and other stakeholders.
Summerset’s Board and Committee Charters, and policies and guidelines referred to in this section, are available to view
at www.summerset.co.nz/investor-centre/corporate-governance/charters-policies.
1 ENSURING SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT
Role of the Board of Directors
The Board of Directors is elected by Shareholders, and has responsibility for taking appropriate steps to protect and enhance
the value of the assets of the Company in the best interests of its Shareholders. The Board has adopted a formal Board Charter
detailing its authority, responsibilities, membership and operation.
The key responsibilities of the Board include setting the overall direction and strategy of the Company, establishing appropriate
policies and monitoring performance of management. The Board appoints the Chief Executive Officer and delegates the day-to-
day operating of the business to the Chief Executive Officer. The Chief Executive Officer implements policies and strategies set
by the Board and is accountable to it. The Board also has responsibility for ensuring the Company’s financial position is sound,
financial statements comply with generally accepted accounting practice, and for ensuring that the Company adheres to high
standards of ethical and corporate behaviour.
The Board currently carries out its responsibilities according to the following mandate:
• At least two, or, if there are eight or more Directors, three or one-third of the total number of Directors should be Independent
as defined in the NZX Listing Rules;
• The Chair of the Board should be a non-executive Director;
• Directors should possess a broad range of skills, qualifications and experience, and remain current on how to best perform
their duties as Directors;
• Information of sufficient content, quality and timeliness as the Board considers necessary shall be provided by management
to allow the Board to effectively discharge its duties;
• The effectiveness and performance of the Board and its individual members should be re-evaluated on an annual basis.
All Directors have been issued letters setting out the terms and conditions of their appointment. The Chief Executive Officer and
members of the executive management team have employment agreements setting out their roles and conditions of employment.
Delegation of authority
The Board delegates to the Chief Executive Officer responsibility for implementing the Board’s strategy and for managing the
Company’s operations. The Chief Executive Officer has Board-approved levels of authority and, in turn, sub-delegates authority
in some cases to direct reports, and has established a formal process for direct reports to sub-delegate certain authorities as
appropriate. This is documented in the Delegation and Powers Reserved to the Board Policy.
Senior executive performance
The Board evaluates annually the performance of the Chief Executive Officer. The Chief Executive Officer reviews the
performance of direct reports and reports to the Board on those reviews. The evaluation is based on criteria that include
the performance of the business and the accomplishment of longer-term strategic objectives. It may include quantitative
and qualitative measures. During the most recent financial year, performance evaluations were conducted in accordance
with this process.
2 STRUCTURING THE BOARD TO ADD VALUE
Board composition
The Company’s constitution prescribes that the Board shall be comprised of a minimum of three Directors, with at least two
Directors ordinarily resident in New Zealand. The Board currently comprises five non-executive Independent Directors. In
determining whether a Director is Independent the Board has regard to the NZX Listing Rules.
As at 31 December 2016, the non-executive Independent Directors were Rob Campbell (Chair), James Ogden, Dr Marie Bismark,
Anne Urlwin and Gráinne Troute. Dr Andrew Wong will be appointed as a non-executive Independent Director on 1 March 2017.
More information on the Directors, including their interests, qualifications and shareholdings, is provided in the Directors’
Profiles and Statutory Information sections of this report.
The Board holds regular scheduled meetings. The Directors generally receive material for Board meetings five working days in
advance, except in the case of special meetings for which the time period may be shorter owing to the urgency of the matter to
be considered.
All Directors have access to executive management to discuss issues or obtain information on specific areas in relation to items
to be considered at Board meetings or other areas as considered appropriate. Key executives and managers are invited to
attend and participate in appropriate sessions at Board meetings. Directors have unrestricted access to Company records and
information.
Directors are entitled to obtain independent professional advice relating to the affairs of the Company or other responsibilities.
Prior approval of the Chair is required before seeking such advice and Directors are expected to ensure that the cost of such
advice is reasonable.
Retirement and re-election
In accordance with the Company’s constitution and the Rules, one third of the Directors are required to retire by rotation and
may offer themselves for re-election by Shareholders each year. Procedures for the appointment and removal of Directors are
also governed by the constitution. The Nominations and Remuneration Committee identifies and nominates candidates to fill
Director vacancies for the approval of the Board.
Board committees
The Board has three standing committees, being the Audit Committee, the Nominations and Remuneration Committee and the
Clinical Governance Committee. Each committee operates under charters approved by the Board, and any recommendations
they make are recommendations to the Board. The terms of reference for each committee are reviewed annually. All Directors
are entitled to attend committee meetings.
Audit Committee
Details for this Committee can be found in section 4 of this Statement of Corporate Governance.
Nominations and Remuneration Committee
The role of the Nominations and Remuneration Committee is to assist the Board in establishing and reviewing remuneration
policies and practices for the Company and in reviewing Board composition. Specific objectives include:
• Assist the Board in planning the Board’s composition;
• Evaluate the competencies required of prospective Directors (both non-executive and executive);
• Identify those prospective Directors and establish their degree of independence;
• Develop the succession plans for the Board, and make recommendations to the Board accordingly;
• Oversee the process of the Board’s annual performance self-assessment and the performance of the Directors; and
• Establish remuneration policies and practices and set and review the remuneration of the company’s Chief Executive
Officer, executive management team and Directors.

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SUMMERSET ANNUAL REPORT 2016
The Nominations and Remuneration Committee must be comprised of a minimum of three Directors, the majority of whom must
be Independent. The Committee currently comprises of Anne Urlwin (Chair), Dr Marie Bismark, James Ogden and Gráinne Troute.
The Board’s policy is that the Board needs to have an appropriate mix of skills, experience and diversity to ensure that it is well
equipped. The Board reviews and evaluates on a regular basis the skill mix required and identifies where gaps exists.
Clinical Governance Committee
The role of the Clinical Governance Committee is to assist the Board in ensuring a systematic approach to maintaining and
improving the quality of care provided by the Company. Specific objectives include:
• Provide assurance that appropriate clinical governance mechanisms are in place and are effective throughout the
organisation;
• Support the leadership role of the Chief Executive Officer in relation to issues of quality, safety and clinical risk;
• Work with management to identify priorities for improvement;
• Ensure that the principles and standards of clinical governance are applied to the health improvement and health
protection activities of the Board; and
• Ensure that appropriate mechanisms are in place for the effective engagement of representatives of residents and
clinical staff.
The Clinical Governance Committee must be comprised of a minimum of three Directors. The Committee currently comprises
of Dr Marie Bismark (Chair), Anne Urlwin and Gráinne Troute.
Attendance at Board and Committee meetings
A total of nine Board meetings, six Audit Committee meetings, five Nominations and Remunerations Committee meetings,
and three Clinical Governance Committee meeting were held in 2016. Director attendance at Board meetings and committee
member attendance at committee meetings is shown below. Directors that were not members of committees also attended
some committee meetings as invited attendees. Their attendance is not recorded below.

Audit Committee meetings
DIRECTORATTENDANCE
James Ogden (Chair)
6/6
Anne Urlwin
6/6
Norah Barlow
2/2
Rob Campbell
6/6
Gráinne Troute
1/1
Board meetings
DIRECTORATTENDANCE
Rob Campbell (Chair)
9/9
James Ogden
9/9
Anne Urlwin
9/9
Dr Marie Bismark
9/9
Norah Barlow
2/2
Gráinne Troute
5/5
Nominations and Remuneration Committee meetings
DIRECTORATTENDANCE
Anne Urlwin (Chair)
5/5
James Ogden
5/5
Dr Marie Bismark
5/5
Gráinne Troute
3/3
Clinical Governance Committee meetings
DIRECTORATTENDANCE
Dr Marie Bismark (Chair)
3/3
Anne Urlwin
3/3
Norah Barlow
1/1
Gráinne Troute
1/1
GOVERNANCE
(continued)
Board performance
The Board undertakes an annual self-assessment of its performance, as does each Committee. The Chair also undertakes an
annual review of individual Board member performance.
3 PROMOTING ETHICAL AND RESPONSIBLE DECISION MAKING
Ethical standards
The Board maintains high standards of ethical conduct and expects the Company’s employees to act legally and with integrity
in a manner consistent with the policies, guiding principles and values that are in place. These include the following:
• Code of Ethics – This guide sets out the basic principles of legal and ethical conduct expected of all employees and Directors.
The Company encourages open and honest communication by staff about any current or potential problem, complaint,
suggestion, concern, or question.
• Conflicts of interest – To maintain integrity in decision making each Director must advise the Board of any potential conflict
of interest if such arises. If a significant conflict of interest exists, the Director concerned will have no involvement in the
decision-making process relating to the matter.
• Securities trading – Directors and employees of the Company are subject to limitations on their ability to buy or sell Company
shares in accordance with the Company’s Securities Trading Policy, the Rules, and the Financial Markets Conduct Act 2013.
• Gifts, entertainment and inducements – The Company has a gifts, entertainment and inducements policy governing the
acceptance and reporting of benefits given to staff by third parties.
• Interest register – In accordance with the Companies Act 1993 and the Financial Markets Conduct Act 2013, the Company
maintains an Interests Register in which all relevant transactions and matters involving the Directors are recorded.
Gender diversity
The Company has a Gender Diversity Policy which sets objectives that will be measured annually to assess performance.
The objectives set out in the policy are:
• Annually review and report on, in the annual report, the gender composition of the Board;
• Annually review and report on, in the annual report, the gender composition of the executive management team;
• The Nominations and Remuneration Committee of the Board will review and report to the Board on the appointment
process for all executive positions on the matter of gender diversity;
• The Board, annually, will require the Chief Executive Officer and Head of Human Resources to review and report on
the gender composition of the wider organisation and, in particular, the mix of genders in management roles throughout
the organisation.