Radius Care Delivers 50% Uplift in 1HY24 Underlying EBITDA
27 November 2023
Radius Care Delivers 50% Uplift in First Half Year Underlying EBITDA
Radius Residential Care Limited (NZX: RAD) today announced its results for the six
months ended 30 September 2023, the first half of the FY24 year.
Highlights:
• Underlying EBITDA of $10.5m
1
, 50% up on comparative period and at the upper
end of guidance issued to the market.
• AFFO of $2.9m, 16% up on comparative period.
• Occupancy 93.0% at period end, ahead of industry average.
• Execution of business improvement programme, delivering $1.3m annual
savings.
• All facilities now fully staffed.
• Establishment of RConnect, Radius internal staffing bureau.
“We are a specialist care provider with a clear focus on our core business. Radius
Care has once again delivered industry leading results and a strong financial
performance, which is a testament to our exceptional people who have continued
to deliver exceptional care to our residents” said Andrew Peskett, Radius Care’s CEO.
People
“I want to give immense thanks to our staff for their resilience over the last few years
and the way they’ve continued to offer the very best of Radius Care to our residents
every day. The results we’ve achieved point to our operational capability as well as
the commitment of our team”.
Radius Care is fully staffed. The overseas nurse recruitment programme was
intensified last year and Internationally Qualified Nurses were successfully recruited
to fill all vacancies. These new team members have completed their New Zealand
accreditation as Registered Nurses and are leading the exceptional Radius Care
provided to our residents.
Business Performance
Radius Care’s business has delivered strong growth across its key metrics.
Occupancy levels remained strong and above industry averages. Occupancy for
September averaged of 93.0%. The strong operating performance was assisted by
staffing stability, reduced external staffing costs and improved mix. We also
increased our accommodation supplement revenue for our premium rooms, and
new funding levels in place from 1 July 2023 boosted revenue in the second quarter.
1
Underlying EBITDA is a non-GAAP (unaudited) financial measure. A reconciliation is
included within the Investor Interim Report and the Investor Presentation.
“The establishment of RConnect has been a highlight of the first half year. Our
internal staffing bureau has been a key factor in controlling our cost base, through
reducing external staffing costs. More recently, RConnect is also sourcing staff for
external customers” said Mr Brien Cree, Radius Care’s Executive Chair.
“The quality of our operating performance and financial results of the last six months
demonstrate the value of our clear focus on our core business. We’re continuing to
position our operations in line with Radius Care’s strategy to deliver accelerated
growth and continue to go from strength to strength”.
Financial Performance
Revenue increased 21% on the prior period to $84.5m excluding other income.
Radius Care’s key performance measure, Underlying EBITDA, was $10.5m, compared
to $7.0m achieved for the comparative period. The result was driven by stronger
operating metrics across the business.
AFFO of $2.9m was earned, 16% up on the $2.5m earned in the comparative period.
Net Profit After Tax was $1.4m, down 18% on $1.7m for the comparative period, which
included $1.8m of one-off gains related to previously leased properties.
Radius Care recently confirmed the short-term bridge facilities held with ASB Bank
had been extended for four months to be repaid on 31 January 2024, recognising the
progress on Radius Care’s debt management programme. The sale of one care
home is due for settlement on 16 January 2024, and the expected net sale proceeds
of approximately $19m will repay debt. With the Board actively progressing the sale
of another care home, Radius Care will be in a stronger position and able to progress
its planned growth strategy more rapidly.
Development Update
During the last two years, Radius Care has completed four large property
transactions, acquiring the land and buildings of eight care homes that were
previously leased, and the acquisition of two integrated care homes and retirement
villages. These acquisitions have increased the opportunities for brownfield
developments to expand these facilities without adding significant additional fixed
overhead.
Planning, preparation and consenting has continued on brownfield developments
at Taupaki Gables in West Auckland and Lexham Park in Katikati, which will extend
these sites. Advance planning is also continuing for the previously announced full-
service retirement village and care home in Belfast, Christchurch.
Outlook
Radius Care expects the improved operating results and momentum in the first half
of FY24 to continue for the remainder of the year.
The Board expects to resume dividend payments following completion of the debt
management programme.
ENDS
Media and Investor Contacts
Andrew Peskett
Chief Executive Officer
Phone: +64 21 747 363
Email:
andrew.peskett@radiuscare.co.nz
Jeremy Edmonds
Chief Financial Officer
Phone: +64 22 650 9354
Email:
jeremy.edmonds@radiuscare.co.nz
About Radius Care
Radius Residential Care Limited was founded in 2003 and operates in the New
Zealand aged care and retirement village sectors. It is a nationwide provider
offering the full range of accommodation and care options giving residents the
ability to "age in place". Today, Radius Care operates 24 aged care facilities, of
which it owns 13 and leases 11. Four owned facilities also include retirement villages
and Radius Care’s online shop sells specialist assisted-living products. The
company employs over 1,900 people, including highly qualified healthcare staff
who are committed to providing the very best in nursing care. Radius Care listed
on the NZX in December 2020. For more information visit radiuscare.co.nz or check
out our Facebook page @RadiusCareNZ.
---
INTERIM FINANCIAL STATEMENTS
Radius Residential Care Ltd | www.radiuscare.co.nz
Interim
Report 2024
Radius Residential Care Ltd | www.radiuscare.co.nz
Caring is our calling
INTERIM FINANCIAL STATEMENTS
Contents
Financial Overview3
Chair and CEO Letter4
Financial Statements7
Financial Notes12
Independent Auditor's Review
Report
33
2
Radius Residential Care Interim Financial Statements 2024
1HY24
Highlights
$12.2K
UNDERLYING
EBITDAR
3
PER CARE
BED IN 1HY24
$4.8M
ACCOMMODATION
SUPPLEMENTS
$74.3M
NET ASSETS
15%
$84.5M
TOTAL REVENUE
21%
FROM $69.9M IN 1HY23
FROM $10.6K IN 1HY23
$5.6M
OPERATING
CASH FLOW
1300%
FROM $0.4M IN 1HY23FROM $3.7M IN 1HY23
FROM $72.9M IN FY23
$1.4M
-18%
$10.5M
UNDERLYING
EBITDA
1
50%
FROM $7.0M IN 1HY23
FROM $1.7M IN 1HY23
NET PROFIT AFTER
TAX
$2.9M
16%
FROM $2.5M IN 1HY23
AVAILABLE FUNDS
FROM OPERATIONS
(AFFO)
2
31%
2%
$355.0M
TOTAL ASSETS
FROM $356.6M IN FY23
0%
1. Earnings before interest, tax, depreciation and amortisation.
2. Underlying EBITDA and AFFO are non-GAAP (unaudited) financial measures which are reconciled to GAAP measures in the
Investor Presentation dated 27 November 2023.
3. Earnings before interest, tax, depreciation, amortisation and rent.
68.2%
BEDS WITH
ACCOMMODATION
SUPPLEMENT
0%
FROM 67.8% IN 1HY23
3
Radius Residential Care Interim Financial Statements 2024
We are delighted to provide you with this
update on Radius Care’s business for the first six
months of the 2024 financial year.
Radius Care delivered a strong operating
performance for the half year, resulting
in Underlying EBITDA of $10.5m, a 50%
improvement over the same period last year.
We are a specialist care provider with a clear
focus on our core business. This focus has once
again delivered industry leading results and a
strong financial performance, demonstrating our
continued leadership in specialist care offerings.
Looking back over the six months to 30
September 2023 there were some very clear
highlights:
• Our care homes being fully staffed following
the successful establishment of industry-
leading international recruitment channels.
• Establishment of RConnect, Radius Care’s
internal and external staffing bureau,
allowing greater flexibility and efficiency in
staff rostering.
• Rapid and successful execution of our 2023
business improvement plan, resulting in
significantly streamlined operations and
reduced headcount delivering $1.3m of
recurrent cost savings.
• Improved commercial metrics, visible in
strong occupancy, hospital mix, increased
accommodation supplement revenue and
settlement of significant numbers of vacant
retirement village stock.
Delivering
Strong Operating
Performance and
Profitability
MESSAGE FROM
Brien Cree
Executive Chair
Andrew Peskett
Chief Executive
4
Radius Residential Care Interim Financial Statements 2024
People
Radius Care has Exceptional People delivering
Exceptional Care. Our team have shown
incredible resilience over the last few years to
enable Radius Care to continue to be the market
leader.
Our care homes are fully staffed. We intensified
our overseas nurse recruitment programme last
year and successfully recruited Internationally
Qualified Nurses to fill all vacancies. These new
team members have now completed their New
Zealand accreditation as Registered Nurses
and are leading the exceptional Radius Care
provided to our residents.
Our successful recruitment drive has enabled
the establishment of RConnect, our bureau that
is now providing qualified staff for both internal
and external customers. RConnect has been a
critical factor in reducing our external staffing
costs (down 66.3%/$1.0m compared to the same
period last year).
Full staffing levels, with the support of
RConnect, have provided a number of additional
benefits. We are able to provide the care our
residents expect at higher occupancy levels,
including in high acuity hospital care. Stability in
staffing leads to more efficient rosters and staff
turnover has significantly reduced.
Operating Performance
Our strong operating performance was
assisted by staffing stability, reduced
external staffing costs, improved mix
and growth in occupancy levels. We
also increased our accommodation
supplement revenue for our premium
rooms. New funding levels in place from
1 July 2023 boosted the second quarter
and will continue for the remainder of
this financial year.
We rapidly implemented our business
improvement plan during the first half
of FY24. This resulted in streamlined
operations and reduced support office
costs to counter the effect of increased
costs in a high-inflation environment.
Due to a concerted sales effort, sales
of retirement village units were very
strong during the first half year.
Capital Management
Progress has been achieved on the
debt management programme to repay
short term bridge facilities and enable
the refinancing of loans funding the
purchase of Matamata Country Lodge.
5
Radius Residential Care Interim Financial Statements 2024
The Board has entered into a conditional sale
and purchase agreement to sell one aged care
home (Arran Court) as a going concern. This care
home has little development potential and is not
expected to materially impact on the Group’s
future earnings.
The net sale proceeds of approximately $19m will
repay the majority of short-term bridge facilities
held with ASB, with settlement due 16 January
2024. Repayment will strengthen Radius Care’s
balance sheet and will allow the Group to progress
our planned growth strategy.
The Board is progressing the sale of a second care
home, with the intention of further reducing debt.
Care Home Redevelopment Programme
During the last two years, Radius Care has
completed four large property transactions,
acquiring the land and buildings of eight care
homes that were previously leased, and the
acquisition of two integrated care homes and
retirement villages. These acquisitions have
increased the opportunities for brownfield
developments to expand these care homes without
adding significant additional fixed overhead.
Planning, preparation and consenting has
continued on brownfield developments at Taupaki
Gables in West Auckland and Lexham Park in
Katikati, which will extend these sites. Advance
planning is also continuing for the previously
announced full-service retirement village and care
home in Belfast, Christchurch.
Execution of these plans will be enabled by a
stronger capital structure.
FY24 Second Half Initiatives
Board and Management’s focus is to
accelerate the momentum established
in Radius Care’s first half trading.
Fully staffed care homes allow further
improvements in service and care,
supporting continued occupancy
growth and improved bed mix. The
team will also focus on continuing
to increase the commercial intensity
to drive increased accommodation
supplement revenue and new
business innovations.
It is the Board’s intention that Radius
Care will extend its care offering
into other areas of the health sector
over time.
A working group is preparing for
the introduction of climate change
reporting for the FY24 year and
participating in sector wide initiatives
to understand and mitigate the impact
of climate change on Radius Care and
the sector.
Outlook
Radius Care expects the improved
operating results and momentum in
our first half results to continue for the
remainder of the financial year.
The Board expects to resume dividend
payments following completion of the
debt management programme.
6
Radius Residential Care Interim Financial Statements 2024
The accompanying notes form an integral part of these consolidated interim financial statements.
CONSOLIDATED STATEMENT OF
Comprehensive Income
For the six months ended
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Unaudited
30 Sep 22
REVENUE
Revenue4.483,30869,101
Deferred management fees1,162768
Total revenue84,47069,869
Change in fair value of investment property2.11,350175
Government subsidy received—154
Interest income3350
Gain on acquisition of previously leased property assets2.5— 1,781
Gain on business acquisition— 927
Total revenue and other income85,85372,956
EXPENSES
Employee costs(52,477)(44,341)
Depreciation expense2.2(5,143)(4,986)
Finance costs(8,008)(5,344)
Other expenses(18,584)(16,097)
Total expenses(84,212)(70,768)
Profit/(Loss) before income tax 1,6412,188
Income tax expense(223)(464)
Profit for the period1,4181,724
Other Comprehensive income for the period
Items that will not be reclassified subsequently to profit and loss
Revaluation of land and buildings, net of tax — —
Other comprehensive income for the period — —
Total comprehensive income1,4181,724
Earnings per share
Basic and diluted earnings per share (cents per share)3.2 0.500.64
7
Radius Residential Care Interim Financial Statements 2024
The accompanying notes form an integral part of these consolidated interim financial statements.
1
Audited
2
Unaudited
CONSOLIDATED STATEMENT OF
Changes in Equity
For the six months ended
In thousands of New Zealand dollars
NOTE
Contributed
Equity
Asset
Revaluation
Reserve
Other
Reserve
Retained
Earnings Total
Balance as at 1 April 2023
1
56,813 9,496 33 6,522 72,864
Profit for the period——— 1,4181,418
Share based payments reserve——10(10)—
Other comprehensive income for the period———— —
Total comprehensive income for the period—— 10 1,408 1,418
Transactions with owners
Issue of share capital (net of transaction
costs and tax)
3.17———7
Dividends paid3.1—————
Total transactions with owners7———7
Balance as at 30 September 2023
2
56,820 9,496 43 7,930 74,289
Balance as at 1 April 2022
1
51,732 6,812 — 11,544 70,088
Profit for the period — — — 1,724 1,724
Share based payments — — 9 — 9
Other comprehensive income for the period — — — — —
Total comprehensive income for the period — — 9 1,724 1,733
Transactions with owners
Issue of share capital (net of transaction
costs and tax)
3.1 5,000 — — — 5,000
Dividends paid3.1 — — — (1,481)(1,481)
Total transactions with owners 5,000 — — (1,481) 3,519
Balance as at 30 September 2022
2
56,732 6,812 9 11,787 75,340
8
Radius Residential Care Interim Financial Statements 2024
The Board of Directors of the Company authorised these consolidated interim financial statements for issue on
27 November 2023.
For and on behalf of the Board.
Hamish Stevens - Chair, Audit and Risk Committee
Brien Cree - Chair, Board of Directors
The accompanying notes form an integral part of these consolidated interim financial statements.
CONSOLIDATED STATEMENT OF
Financial Position
As at 30 September 2023
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Audited
31 Mar 23
Assets
Cash and cash equivalents908515
Trade and other receivables13,77013,071
Held for sale assets2.325,704891
Inventories708753
Current tax assets— 1,321
Investment properties2.171,47370,143
Property, plant and equipment2.2110,879133,870
Right-of-use assets2.5112,321112,464
Intangible assets
1
15,70219,797
Deferred tax assets4.13,5513,770
Total assets 355,016356,595
Liabilities
Cash and cash equivalents (overdraft)— 2,894
Trade and other payables17,23520,543
Borrowings3.397,68797,687
Deferred management fees2.47,5866,973
Refundable occupation right agreements2.435,76434,104
Lease liabilities2.5122,454121,530
Total liabilities 280,726 283,731
Net assets74,28972,864
Equity
Share capital3.156,820 56,813
Reserves 3.19,539 9,529
Retained earnings7,930 6,522
Total equity 74,289 72,864
1
The movement in intangible assets relates to the reclassification of goodwill to held for sale assets following the proposed sale of two care homes detailed
in note 2.3
9
Radius Residential Care Interim Financial Statements 2024
The accompanying notes form an integral part of these consolidated interim financial statements.
CONSOLIDATED STATEMENT OF
Cash Flows
For the six months ended
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Unaudited
30 Sep 22
Receipts from residents for care fees and village fees84,07565,856
Payments to suppliers and employees(76,479)(60,039)
Proceeds from the sale of Refundable Occupation Right Agreements6,2041,335
Payments for the repurchase of Refundable Occupation Right Agreements(1,789)(855)
Interest received3250
Interest paid - borrowings(4,766)(2,286)
Interest paid - lease liabilities(2,991)(3,046)
Income tax (expense)/benefit1,313(615)
Net cash provided by operating activities 5,599400
Proceeds from the sale of property, plant and equipment8897
Payments for the purchase of property, plant and equipment(1,404)(53,032)
Payments for village developments(458)(97)
Acquisition of subsidiaries, net of cash acquired—(500)
Net cash used in investing activities(973)(53,622)
Proceeds from bank borrowings — 54,020
Principal payments of lease liabilities(1,340)(1,277)
Dividends paid —(1,481)
Net cash provided by/(used in) financing activities(1,340)51,262
Cash and cash equivalents at beginning of the year(2,379)2,088
Net (decrease)/increase in cash and cash equivalents held3,288(1,960)
Cash and cash equivalents at end of period908128
For the six months ended
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Audited
31 Mar 23
Comprising of
Cash and cash equivalents908515
Cash and cash equivalents (overdraft) —(2,894)
Cash and cash equivalents at end of period908(2,379)
10
Radius Residential Care Interim Financial Statements 2024
CONSOLIDATED STATEMENT OF
Cash Flows continued
The accompanying notes form an integral part of these consolidated interim financial statements.
For the six months ended
In thousands of New Zealand dollars
Unaudited
30 Sep 23
Unaudited
30 Sep 22
Reconciliation of profit for the period to net
cash provided by operating activities
Profit for the period1,4181,724
Adjustments for non-cash items
Depreciation5,1434,988
Share based payments109
Net loss on disposal of property, plant and equipment5213
Gain on acquisition of previously leased property assets —(1,781)
Fair value adjustment to investment properties(1,350)(175)
Movement in deferred tax(358)351
Gain on business acquisition —(927)
Changes in operating assets and liabilities
- Trade and other receivables and other assets(844)(4,347)
- Inventories476
- Trade and other payables and other liabilities(2,072)1,467
- Current tax liabilities1,894(502)
- Refundable Occupation Right Agreements1,659(426)
Net cash provided by operating activities 5,599400
11
Radius Residential Care Interim Financial Statements 2024
Notes to the Consolidated Interim Financial Statements
For the six months ended 30 September 2023
1. GENERAL INFORMATION
1.1. Basis of Preparation
Reporting Entity
The consolidated financial statements are for Radius
Residential Care Limited (‘the Company’) and its
subsidiaries (together ‘the Group’).
The Group provides rest home and hospital care for the
elderly along with development and operation of integrated
retirement villages in New Zealand.
Statutory Basis and Statement of Compliance
Radius Residential Care Limited is a limited liability
company, incorporated and domiciled in New Zealand. It
is registered under the Companies Act 1993 and is a FMC
Reporting Entity in terms of Part 7 of the Financial Markets
Conduct Act 2013. The Company is listed on the NZX
Main Board (“NZX”). The consolidated interim financial
statements have been prepared in accordance with the
requirements of the NZX, and Part 7 of the Financial
Markets Conduct Act 2013.
These consolidated interim financial statements have
been prepared in accordance with Generally Accepted
Accounting Practice in New Zealand (‘NZ GAAP’), They
comply with New Zealand equivalents to International
Accounting Standard 34 Interim Financial reporting (‘NZ
IAS 34’) and International Accounting Standard 34 Interim
Financial Reporting (‘IAS 34’). The Group is a Tier 1 for-
profit entity in accordance with XRB A1 Application of the
Accounting Standards Framework.
The accounting policies that materially affect the
measurement of the Consolidated Statement of
Comprehensive Income, Consolidated Statement of
Financial Position and the Consolidated Statement of Cash
Flows have been applied on a basis consistent with those
used in the audited consolidated financial statements
for the year ended 31 March 2023. All new standards,
amendments and interpretations to existing standards that
came into effect during the current accounting period have
been adopted in the current year. None of these have had a
material impact on the Group.
The consolidated interim financial statements do not
include all the notes of the type normally included in the
consolidated annual financial statements. Accordingly,
these consolidated interim financial statements are to be
read in conjunction with the consolidated annual financial
statements for the year ended 31 March 2023, prepared
in accordance with New Zealand Equivalents to the
International Financial Reporting Standard (‘NZ IFRS’) and
International Financial Reporting Standards (‘IFRS’).
The consolidated interim financial statements for the six
months ended 30 September 2023 and comparatives for
the six months ended 30 September 2022 are unaudited,
but reviewed. The consolidated annual financial statements
for the year ended 31 March 2023 were audited and form
the basis for the comparative figures for that period in these
statements.
The consolidated interim financial statements have been
prepared on a going concern basis, which contemplates
continuity of normal business activities and the realisation
of assets and the settlement of liabilities in the ordinary
course of business. As at 30 September 2023, the
Group's current assets were $41.2m and current liabilities
1
were $56.1m.
The balance sheet for the Group is presented on the
liquidity basis where the assets and liabilities are presented
in the order of their liquidity.
Functional and Presentation Currency
The consolidated financial statements are presented in New
Zealand dollars which is the Group’s functional currency. All
amounts have been rounded to the nearest thousand, unless
otherwise indicated.
Measurement Basis
These consolidated financial statements have been
prepared under the historical cost convention, with the
exception of investment properties (note 2.1) and land and
buildings included within property, plant and equipment
(note 2.2).
Material Uncertainty Around Going Concern
In the Group's annual financial statements for the year
ended 31 March 2023, the Group disclosed a material
uncertainty around going concern. As at 31 March 2023,
$34.5m of borrowings were due for repayment within 12
months and the Group had reported a loss of $2.1m for
the year ended 31 March 2023. In response, the Board and
Management developed a debt management programme,
identified and implemented a cost reduction programme
intended to deliver a minimum of $1.3m recurrent cost
savings, and entered into a number of agreements for
unsold/vacant Occupation Right Agreement (ORA) stock.
The Board and Management also began reviewing the
Group’s property asset portfolio with a focus on identifying
non-core properties which were not considered essential to
achieving the Group’s longer term growth strategy.
Progress has been achieved on these programmes. The
Group has reported a profit of $1.4m for the half year ended
30 September 2023 (year ended 31 March 2023: loss of
$2.1m) and a net increase in cash and cash equivalents held
of $3.3m (year ended 31 March 2023: decrease of $4.5m).
As at 30 September 2023, there were 2 unsold/vacant units
of ORA stock without conditional/unconditional agreements
(31 March 2023: 10 units). The Board has entered into a
conditional sale and purchase agreement to sell one aged
1.This excludes occupation right agreements (‘ORA’) as a refundable occupation license payment is repayable to the resident upon termination (subject
to a new ORA being issued to an incoming resident), the fair value is equal to the face value, being the amount that can be demanded. The expected
maturity of the refundable obligations to residents is beyond 12 months as disclosed in Note 2.4 ‘Refundable Occupation Right Agreements’.
12
Radius Residential Care Interim Financial Statements 2024
care home (Arran Court) as a going concern. This care
home has little development potential and is not expected
to materially impact on the Group’s future earnings. The net
sale proceeds of approximately $19m will repay the majority
of short-term bridge facilities held with ASB Bank ('ASB'),
with settlement due 16 January 2024. Repayment will
significantly strengthen Radius Care’s balance sheet and will
allow the Group to progress our planned growth strategy.
The Board is progressing the sale of a second care home,
with the intention of further reducing debt.
As at 30 September 2023, the Group had current liabilities
that exceeded current assets by $15m
1
, had not drawn down
its $4m overdraft facility (31 March 2023: $2.9m drawn) and
had total borrowings of $97.7m (31 March 2023: $97.7m).
The overdraft facility will decrease from $4m to $3.5m on 31
December 2023 and to $2m on 31 January 2024. $34.5m of
borrowings are due for repayment within the next 12 months
(refer note 3.3).
ASB has approved the plan to sell the two aged care homes,
and on 29 September 2023, granted a further four-month
extension relating to $23m of finance facilities (being
the current portions of the Committed Money Market B
and E facilities described in note 3.3). These two finance
facilities currently have an expiry date of 31 January 2024.
The facility agreements also include an ‘event of review’
that requires the Company to have unconditional sale and
purchase agreements on or before 8 December 2023.
The Board and Management anticipate that completion
of the debt management programme will enable the
refinancing of the $11m of related party and MRFT Finance
Limited loans currently due for repayment between 31
March 2024 and 30 April 2024, on more favourable terms.
While it is not currently anticipated that these loans can be
repaid in full based on current cash flow projections, it will
enable other options which include:
• Partial repayment and renegotiation of loan terms
• Refinancing the loan to another lender or the bank
with a longer repayment term and more favourable
lending terms
There has been no non-compliance with the Group’s
banking covenants to date and the Board and Management
expect this to continue over the next 24 months.
The Board and Management are committed to undertaking
all necessary steps to ensure the Group can meet its
obligations. Should the Group not be able to successfully
complete the above debt management programme or
obtain further lending extensions, this would give rise to
a material uncertainty in relation to the Group’s ability to
continue as a going concern. If the Group were unable
to continue in operational existence for the foreseeable
future, adjustments may have to be made to reflect the
situation that assets may need to be realised other than in
the amounts at which they are currently recorded in the
Statement of Financial Position. In addition, the Group may
need to provide for future liabilities that might arise and to
reclassify non-current liabilities as current liabilities in the
Statement of Financial Position.
The Board and Management have concluded that the
adoption of a going concern basis of accounting is
appropriate based on reasonable expectations that the
above debt management programme and continuation
of profitable trading will enable the Group to continue
operations at existing levels and meet its debts when
they fall due for the foreseeable future and not less than
12 months from the signing of the consolidated interim
financial statements. In making its assessment, Management
has considered a range of factors and has made several
significant judgments. This includes an evaluation of the
Group’s budget and forecasts for the 2024, 2025 and 2026
financial years, which project a continuation of profitable
trading, positive operating cash flow, and a situation where
the Group can meet its obligations.
The Board and Management have also assessed that the
ASB will not immediately call the facilities due to the
existing relationships and understanding of the Group's
business model. This assumption, however, is reliant on
the success of the Group’s strategies and negotiations
with ASB. However, these are material uncertainties and
significant judgments. The ability of the Group to continue
as a going concern is dependent on successful execution of
the aforementioned plans, along with continued profitable
trading and sector performance.
Key Estimates and Judgements
The preparation of the consolidated interim financial
statements conforms with NZ IAS 34 which requires the
use of certain critical accounting estimates. It also requires
the Board of Directors and Management to exercise
their judgement in the process of applying the Group’s
accounting policies.
Estimates and underlying assumptions are reviewed on
an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised
and in any future periods affected.
The areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are
significant to the consolidated interim financial statements
are described in the following notes:
• Material uncertainty around going concern (note 1.1)
• Valuation of investment properties (note 2.1)
• Valuation of land and buildings (note 2.2)
• Impairment testing of goodwill:
The recoverability of the carrying value of goodwill
is assessed at least annually to ensure that it is not
impaired. Performing this assessment generally requires
management to estimate future cash flows to be
generated by the cash-generating unit, which entails
making judgements, including the expected rate of
growth of revenues based on budgeted projections of
occupancy levels, margins expected to be achieved, the
level of future capital expenditure required to support
these outcomes and the appropriate discount rate to
apply when valuing future cash flows.
1.This excludes occupation right agreements (‘ORA’) as a refundable occupation license payment is repayable to the resident upon termination (subject
to a new ORA being issued to an incoming resident), the fair value is equal to the face value, being the amount that can be demanded. The expected
maturity of the refundable obligations to residents is beyond 12 months as disclosed in Note 2.4 ‘Refundable Occupation Right Agreements’.
13
Radius Residential Care Interim Financial Statements 2024
• Impairment testing of right-of-use assets (note 2.5)
• Recognition of deferred tax assets (note 4.1)
• Impairment of non-financial assets
At the end of each reporting period, the Group assesses
whether there is any indication that a non-financial
asset or cash-generating units (CGU) may be impaired.
If any such indication exists, the Group will estimate the
recoverable amount of the asset or CGU. Irrespective of
whether there is any indication of impairment, the Group
tests its intangible assets with an indefinite useful life,
currently comprised of only goodwill, for impairment
annually, at the end of the reporting period. In assessing
whether there is any indication that an asset may be
impaired, the Group considers external and internal
sources of information. The recoverable amount of an
asset or CGU is the higher of its fair value less costs of
disposal and its value in use. In assessing value in use, the
estimated future cash flows expected to be derived from
the asset or CGU are discounted to their present values.
The discount rate reflects current market assessments
of the time value of money and the risks specific to the
assets or CGU, for which the estimates of future cash
flows have not been adjusted. In assessing fair value
less costs of disposal, the fair value is determined in
accordance with the valuation approaches described
in notes 2.1 for Investment properties, 2.2 for Land
and buildings, and for Impairment testing of goodwill
(above), taking into account an allowance for costs of
disposal, being direct incremental costs to bring an asset
or CGU into condition for sale.
Following on from the disclosures in the Group’s annual
financial statements for the year ended 31 March 2023
and interim financial statements for the period ended
30 September 2022, regarding the ongoing COVID-19
pandemic, the New Zealand Government maintained a
range of public health and economic measures to mitigate
the impact of the COVID-19 pandemic through the first
half of the comparative period. These measures were
gradually removed during the comparative period with
the COVID-19 Protection Framework officially ending on
12 September 2022 and vaccine mandates being removed
on 26 September 2022. The pandemic and subsequent
health measures imposed did lower overall economic
activity across New Zealand. The Group’s revenue had not
been significantly impacted, but the COVID-19 pandemic
did increase the Group’s expenditures since the outbreak
began. In addition to the COVID-19 pandemic, unfavourable
macro and micro economic conditions and adverse
global events during the year, which include rapidly rising
interest rates and inflation, skill shortages and the flow on
effects from the conflict between Ukraine and Russia has
had a significant impact on energy and financial markets
across the globe which also further impacted the Group’s
expenditures. The Directors have assessed and taken into
consideration the impact of these unfavourable macro and
micro economic conditions and adverse global events on
these key estimates and judgements. It is not possible to
estimate the short and long-term effects that the above
matters will have on operations.
As at the date of these interim financial statements, all
reasonably known and available information with respect
to these matters has been taken into consideration and all
reasonably determinable adjustments have been made in
preparing these consolidated interim financial statements.
Market Capitalisation
At reporting date the market capitalisation of the Group
(being the 30 September 2023 closing share price, as
quoted on the NZX Main Board, multiplied by the number
of shares on issue) was below the carrying amount of the
Group’s net assets. In considering the difference, the Group
notes that over 85% of total assets at 30 September 2023
are either non-financial property assets carried at fair
value (52%) assessed by the Group’s independent external
property valuers, or non-financial assets subject to annual
impairment assessment (33%). The Group has undertaken
an assessment of the recoverable amount of its assets/
CGUs. Management believes that no reasonably possible
changes in any of the above key assumptions would
cause the carrying value of the non-financial assets to be
materially lower than their recoverable amount.
New and Amended Accounting Standards and
Interpretations
All mandatory new and amended standards and
Interpretations have been adopted in the current year.
None had a material impact on these financial statements.
The Group has not early adopted any new standards,
amendments or interpretations to existing standards that
are not yet effective.
Segment Reporting
An operating segment is a component of an entity that
engages in business activities which earn revenue and incur
expenses and where the chief operating decision maker
reviews the operating results on a regular basis and makes
decisions on resource allocation.
The Group operates in one operating segment being
the provision of aged care in New Zealand. The chief
operating decision maker, the Board of Directors, reviews
the operating results on a regular basis and makes
decisions on resource allocation based on the review of
Group results and cash flows as a whole. The nature of the
services provided and the type and class of residents have
similar characteristics within the operating segment. 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. No other
customers individually contribute a significant proportion
of the Group’s revenue. All revenue earned and assets held
are in New Zealand.
14
Radius Residential Care Interim Financial Statements 2024
2. PROPERTY ASSETS
2.1. Investment Properties
Accounting Policy
Investment properties include completed freehold land and buildings, freehold land and buildings under development
comprising retirement villages including common facilities, provided for use by residents under the terms of a Refundable
Occupation Right Agreements (ORAs). Investment properties are held for long term yields and to generate rental income.
Investment properties are initially recognised at cost. After initial recognition, investment properties are measured at fair
value. Gains or losses arising from a change in the fair value of investment properties are recognised in profit or loss.
Rental income from investment properties, being deferred management fees, is accounted for as described in note 2.4.
Valuation Process and Key Inputs
The Group’s investment properties are valued on an annual basis. For the year ended 31 March 2023, the valuations
were undertaken by LVC Limited (LVC) (prior year by CBRE Limited (CBRE) and Colliers), independent valuers. LVC
are registered with the Property Institute of New Zealand, employs registered valuers and has appropriate recognised
professional qualifications and recent experience in the location and category of properties being valued.
The valuation of investment property is adjusted for cash flows relating to refundable occupation licence payments,
residents’ share of resale gains and management fees receivable recognised separately on the Consolidated Statement of
Financial Position and also reflected in the valuation model. As at 30 September 2023, Management has also confirmed
with its valuers that there has not been any material changes or external indicators of impairment in the valuation of the
properties.
Unsold/Vacant Units
Any developed but not yet sold units (unsold/vacant units) are valued based on recent comparable transactions, adjusted
for disposal costs, holding costs and an allowance for profit and risk. This represents the fair value of the Group’s interest in
unsold/vacant units at reporting date.
1. On 29 September 2022, the Group acquired investment properties as part of the Matamata Retirement Village business combination, refer to note
5.6 of the Group’s audited consolidated financial statements for the year ended 31 March 2023.
For the six months ended
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Audited
31 Mar 23
Investment Properties
Opening carrying amount70,14346,014
Acquisition of Matamata Retirement Village
1
— 23,037
Net fair value gain1,350765
Occupation Right Agreements settled(5,312)(2,919)
Occupation Right Agreements entered5,3122,919
Purchases438327
Unsold/vacant units——
Other adjustments(458)—
Closing carrying amount71,47370,143
A reconciliation between the valuation and the amount recognised on the Consolidated Statement of Financial Position
as investment properties is as follows:
Valuation of operator's interest 25,03622,821
Refundable Occupation Right Agreements2.435,76434,104
Deferred management fees2.47,5866,973
Unsold/vacant units6923,850
Residential properties
2,3952,395
71,47370,143
15
Radius Residential Care Interim Financial Statements 2024
Key Accounting Estimates and Judgements
As the fair value of investment properties is determined
using inputs that are significant and unobservable, the
Group has categorised investment properties as Level 3
under the fair value hierarchy in accordance with NZ IFRS 13
Fair Value Measurement.
Valuation Uncertainty
As at 31 March 2023
As at 31 March 2023, the valuer of all four investment
properties has included a valuation uncertainty clause
in their valuation reports noting that “The markets
experienced strong growth throughout 2021 and much of
2022. However due to recent Government lending controls,
global supply issues, abnormally high inflation and rapidly
rising interest rates we have seen a slowdown in markets
generally with declining asset values, and an economic
downturn (recession) is seen as a risk going forward. Sales
transaction volumes have decreased significantly as there
is a disconnect between vendor expectation and the price
purchasers are prepared to pay due to the large increase
in interest rates over a short time frame. Therefore, less
certainty and a higher degree of caution should be attached
to our valuation than would normally be the case”. Given
the valuation uncertainty, the valuer has recommended
in their reports that the valuations of the properties be
reviewed periodically.
Significant Unobservable Inputs
The significant unobservable input used in the fair value
measurement of the Group’s development land is the value
per square meter assumption. Increases in the value per
square meter rate result in the corresponding increases in
the total valuation.
The significant unobservable inputs used in the fair value
measurement of the Group’s portfolio of completed
investment properties are the discount rate and the
property growth rate.
The stabilised occupancy is a key driver of the LVC’s
valuation. A significant increase/(decrease) in the
occupancy period would result in a significant lower/
(higher) fair value measurement.
Current ingoing price, for subsequent resales of ORAs, is
a key driver of the LVC’s valuation. A significant increase/
(decrease) in the ingoing price (as driven by the property
growth rates) would result in a significantly higher/(lower)
fair value measurement.
2.2. Property, Plant and Equipment
Accounting Policy
Property, plant and equipment is measured at cost or fair
value less, where applicable, any accumulated depreciation
and any accumulated impairment losses.
Cost includes expenditures that are directly attributable to
the acquisition of the asset. The cost of self constructed
assets includes the cost of materials and direct labour and
any other costs directly attributable to bringing the asset to
a working condition for its intended use. Purchased software
that is integral to the functionality of the related equipment is
capitalised as part of that equipment.
Subsequent costs are added to the carrying amount of an
item of plant and equipment when that cost is incurred if it
is probable that the future economic benefits embodied with
the item will flow to the Group and the cost of the item can be
measured reliably. All other costs are recognised in the profit
or loss as an expense as incurred. The costs of the day to day
servicing of property, plant and equipment are recognised in
profit or loss as incurred.
Freehold land and buildings are measured at revalued
amounts, being the fair value at the date of the revaluation,
less any subsequent accumulated depreciation and any
accumulated impairment losses. At each reporting date the
carrying amount of each asset is reviewed to ensure that
it does not differ materially from the asset’s fair value at
reporting date. Where necessary, independent valuations are
performed and the asset is revalued to reflect its fair value.
Increases in the carrying amounts arising on revaluation of
land and buildings are recognised in other comprehensive
income and accumulated in equity. To the extent that the
increase reverses a decrease of the same asset previously
recognised in profit or loss, the increase is recognised in profit
or loss. Decreases that offset previous increases of the same
asset are recognised in other comprehensive income; all other
decreases are recognised in profit or loss.
Leasehold improvements are depreciated over the shorter
of either the unexpired period of the lease or the estimated
useful lives of the improvements.
Land is not depreciated. The depreciable amount of all
other property, plant and equipment is depreciated using
the straight line method over their estimated useful lives
commencing from the time the asset is held available for use,
consistent with the estimated consumption of the economic
benefits embodied in the asset.
CategoryUseful Life Range
Buildings50 years
Motor vehicles5 years
Furniture, fixtures and fittings5 - 10 years
Information technology4 years
Medical equipment 7 years
16
Radius Residential Care Interim Financial Statements 2024
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance date. No depreciation
is charged in the year of sale for all assets other than buildings in which case depreciation is charged to the earlier of the
date of classification to held for sale or the date of sale.
Assets are assessed for impairment whenever events or circumstances arise that indicate the asset may be impaired. An
asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount. Impairment losses in respect of individual assets are recognised immediately
in profit or loss unless the asset is measured at a revalued amount, in which case the impairment loss is treated as a
revaluation decrease and is recognised in other comprehensive income to the extent that it does not exceed the amount in
the revaluation surplus for the same asset.
Gains and losses on disposals are determined by comparing the net disposal proceeds
with the carrying amount of the asset. These are included in the profit or loss.
In thousands of New Zealand dollars
Land and
Buildings
Motor
Vehicles
Furniture,
Fixtures
and Fittings
Information
Technology
Medical
Equipment
Work in
ProgressTotal
Unaudited - six months ended 30 September 2023
Opening net book value112,51035612,8061,7464506,002133,870
Additions
1
105—6649525281,358
Transfers
2
(19,861)—(1,683)—1(17)(21,560)
Disposals———(52)——(52)
Depreciation(776)(60)(1,411)(417)(73)—(2,737)
Closing net book value
91,978 296 10,376 1,286 430 6,513 110,879
Unaudited - Six month ended 30 September 2023
Cost
3
92,7711,45937,0056,5991,1076,513145,453
Accumulated Depreciation(793)(1,163)(26,629)(5,312)(677)—(34,574)
Net book value91,97829610,3761,2864306,513110,879
In thousands of New Zealand dollars
Land and
Buildings
Motor
Vehicles
Furniture,
Fixtures
and Fittings
Information
Technology
Medical
Equipment
Work in
ProgressTotal
Audited - Year ended 31 March 2023
Opening net book value56,06629310,9992,1202894,07273,839
Additions
1
53,0831963,4044192598,67166,032
Revaluation531—————531
Transfers5,007—1,224 78 14 (6,323)—
Disposals(891)(6)(9)——(418)(1,324)
Depreciation(1,286)(127)(2,812)(871)(112)—(5,208)
Closing net book value 112,510 356 12,806 1,746 450 6,002 133,870
Audited - Year ended 31 March 2023
Cost
3
112,5271,45938,0246,6671,0546,002165,733
Accumulated Depreciation(17)(1,103)(25,218)(4,921)(605)—(31,864)
Net book value112,51035612,8061,7464506,002133,870
1. On 6 May 2022, the Group acquired four properties, previously leased from UCG Investments Limited for consideration of $46.7m. At the same time,
a sale and purchase agreement for a fifth property from UCG Investments Limited was also entered into, however the Group entered into a separate
nomination agreement to nominate its purchaser rights for the purchase of this one property, to a related party, Warehouse Storage Limited, related
by virtue of common shareholder (the Nomination). The Group has also been granted an option to acquire the property back from Warehouse Storage
Limited from 24 May 2022 onwards, at a purchase price determined based on an agreed yield, calculated on the current market rent at the time the
option is taken up. The Nomination and Option enabled the Group to execute the transaction quickly and efficiently with the UCG Investments Limited
for the four other properties. The purchase of the four properties was funded from bank borrowings, refer to note 3.3. Subsequently on 29 September
2022, the Group acquired another property as part of the Matamata business combination at a fair value of $6.9m, refer to note 5.6 in the Group’s
audited consolidated financial statements for the year ended 31 March 2023.
2. Transfers of $21.6m relates to the reclassification of property plant and equipment to held for sale assets following the proposed sale of two care
homes detailed in note 2.3
3. The revaluation noted in the Statement of Comprehensive Income differs from the above due to deferred tax.
17
Radius Residential Care Interim Financial Statements 2024
Valuations
As at 31 March 2023
The Group’s thirteen properties included in land and
buildings were revalued on 31 March 2023 to $112.5m from
a carrying value immediately prior of $112m, resulting
from a revaluation gain of $3.5m in Other Comprehensive
Income and a revaluation loss of $3.0m in Profit and Loss.
The fair values of the thirteen revalued land and buildings
on freehold land have been determined by reference to
independent valuations obtained as at 31 March 2023.
These valuations were undertaken by a Property Institute
of New Zealand registered valuer, LVC Limited. LVC, an
external independent valuation company employing
registered valuers, have appropriate recognised professional
qualifications. As at 30 September 2023, Management has
also confirmed with its valuers that there has not been any
material changes or external indicators of impairment in the
valuation of the properties.
Valuation Uncertainty
As at 31 March 2023, the valuer of all thirteen properties has
included a valuation uncertainty clause in their valuation
reports noting that "The markets experienced strong
growth throughout 2021 and much of 2022. However due to
recent Government lending controls, global supply issues,
abnormally high inflation and rapidly rising interest rates we
have seen a slowdown in markets generally with declining
asset values, and an economic downturn (recession) is seen
as a risk going forward. Sales transaction volumes have
decreased significantly as there is a disconnect between
vendor expectation and the price purchasers are prepared
to pay due to the large increase in interest rates over a short
time frame. Therefore, less certainty and a higher degree
of caution should be attached to our valuation than would
normally be the case". Given the valuation uncertainty, the
valuer has recommended in their reports that the valuations
of the properties be reviewed periodically.
Key Accounting Estimates and Judgements
Property measurements are categorised as Level 3 (2022:
Level 3) of the fair value measurement hierarchy as the fair
value is determined using inputs that are unobservable.
Significant Unobservable Inputs
The significant unobservable input used in the fair value
measurement of the Group's land and buildings is the
capitalisation rate applied to rentals. A significant decrease/
(increase) in the capitalisation rate would result in
significantly higher/(lower) fair value measurement.
2.3. Held for Sale Assets
Non Current assets, or disposal groups comprising assets
and liabilities, are classified as held for sale if it is highly
probably that they will be recovered primarily through sale
rather than through continuing use.
Such assets, or disposal groups, are generally measured
at the lower of their carrying amount and the fair value
less cost to sell. Any impairment loss on a disposal group
is allocated first to goodwill and then to the remaining
assets and liabilities on a pro rata basis, except that no
loss is allocated to inventories, financial assets, deferred
tax assets, employee benefit assets, investment property
which continue to be measured in accordance with the
Company's other accounting policies, Impairment losses on
initial classification as held for sale or held for distribution
and subsequent gains and losses on remeasurement are
recognised in profit or loss.
Once classified as held for sale, intangible assets and
property, plant and equipment are no longer amortised
or depreciated.
In September 2023, the Board and Management committed
to a plan to sell two care homes which have subsequently
been presented as held for sale. Efforts to sell the care
homes have started and settlement is expected to occur
during January 2024.
At reporting date, the Board has entered into a conditional
sale and purchase agreement to sell one aged care home
as a going concern. The Board is also progressing the
sale of a second care home, with the intention of further
reducing debt.
No impairment losses have been recognised as the
expected sale price of the care homes is in excess of
the current carrying value of care home assets and
associated goodwill.
At 30 September 2023, the care homes were stated at the
lower of fair value less cost to sell and their carrying value
and comprised the following assets.
For the six months ended
In thousands of New Zealand dollars
Unaudited
30 Sep 23
Property, plant and equipment 21,568
Goodwill 4,095
Inventory41
Assets held for sale 25,704
18
Radius Residential Care Interim Financial Statements 2024
2.4. Refundable Occupation Right Agreements
Accounting Policy
Occupation Right Agreements (ORAs) confer the right to
occupy a retirement unit and are considered leases under
NZ IFRS 16 Leases.
A new resident is charged a refundable security deposit, on
being issued the right to occupy one of the Group's units,
which is refunded to the resident subject to a new ORA for
the unit being issued to an incoming resident, net of any
amount owing to the Group. The Group has a legal right
to set off any amounts owing to the Group by a resident
against that resident's security deposit. Such amounts
include management fees, rest home and hospital fees,
service fees and village fees. As the refundable occupation
right is repayable to the resident upon vacating the unit
(subject to a new ORA for the unit being issued to an
incoming resident), the fair value is equal to the face value,
being the amount that can be refunded.
The right of residents to occupy the investment properties
of the Group is protected by the Statutory Supervisor
restricting the ability of the Group to fully control these
assets without undergoing a consultation process with all
affected parties.
A resident is charged a village contribution fee in
consideration for the right to occupy one of the
Group’s units:
• for Windsor Lifestyle Estate Limited, to a maximum of
30% of the entry payment;
• for Elloughton Grange Village Limited, to a maximum of
30% of the entry payment;
• for Clare House Village Limited, to a maximum of 30% of
the entry payment;
• for Matamata Retirement Village Limited, to a maximum
of 30% of the entry payment.
A resident is charged an administration fee for the right to
occupy one of the Group's units:
• for Clare House Retirement Village Limited, to a
maximum of 3.45% of the entry payment.
• for Radius Matamata Retirement Village Limited, to a
maximum of 4.0% of the entry payment.
The village contribution is payable by the resident on
termination of the ORA. Village contribution is recognised
as deferred management fees. The management fee
receivable is recognised in accordance with the terms of the
resident's ORA.
The deferred management fee represents the difference
between the management fees receivable under the ORA
and the portion of the management fee accrued which is
recognised on a straight-line basis over the longer of the
term specified in a resident's ORA or the average expected
occupancy for the relevant accommodation i.e. 8 to 9
years for villas and 3 to 4 years for serviced apartments
(2022 : 8 to 8.6 years for villas and 3 to 4 years for
serviced apartments).
The management fee recognised in the Consolidated
Statement of Comprehensive Income represents income
earned in line with the average expected occupancy.
As a refundable occupation license payment is repayable to
the resident upon termination (subject to a new ORA being
issued to an incoming resident), the fair value is equal to the
face value, being the amount that can be demanded.
The expected maturity of the refundable obligations to
residents is beyond 12 months.
For the six-months ended
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Audited
31 Mar 23
Refundable Occupation Right Agreements
Refundable occupation licence payments 50,18547,7 72
Less: Management fee receivable (per contract)
(14,421)(13,668)
35,76434,104
Reconciliation of Management Fees recognised under NZ IFRS
and per ORA
Management fee receivable (per contract)(14,421)(13,668)
Deferred management fees2.1 7,586 6,973
Management fee receivable (per NZ IFRS)(6,835)(6,695)
Comprising of
Current deferred management fees1,9051,900
Non-current deferred management fees5,6815,073
Deferred management fees7,5866,973
19
Radius Residential Care Interim Financial Statements 2024
2.5. Leases
Accounting Policy
At the commencement date of a lease (other than leases
of 12-months or less and leases of low value assets), the
Group recognises a lease asset representing its right to use
the underlying asset and a lease liability representing its
obligation to make lease payments.
Right-of-use Assets
Right-of-use assets are initially recognised at cost,
comprising the amount of the initial measurement of the
lease liability, any lease payments made at or before the
commencement date of the lease, less any lease incentives
received, any initial direct costs incurred by the Group,
and an estimate of costs to be incurred by the Group in
dismantling and removing the underlying asset, restoring
the site on which it is located or restoring the underlying
asset to the condition required by the terms and conditions
of the lease.
Subsequent to initial recognition, lease assets are measured
at cost (adjusted for any remeasurement of the associated
lease liability), less accumulated depreciation and any
accumulated impairment loss. Right-of-use assets are
assessed for impairment whenever events or circumstances
arise that indicate the asset may be impaired. An asset’s
carrying amount is written down immediately to its
recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount.
Right-of-use assets are depreciated over the shorter of the
lease term and the estimated useful life of the underlying
asset, consistent with the estimated consumption of the
economic benefits embodied in the underlying asset.
Lease Liabilities
Lease liabilities are initially recognised at the present value
of the future lease payments (i.e., the lease payments
that are unpaid at the commencement date of the lease).
These lease payments are discounted using the interest
rate implicit in the lease, if that rate can be readily
determined, or otherwise using the Group’s incremental
borrowing rate.
Subsequent to initial recognition, the lease liability is
measured at amortised cost using the effective interest rate
method. Interest expense on lease liabilities is recognised
in profit or loss (as a component of finance costs). Lease
liabilities are remeasured to reflect changes to lease terms,
changes to lease payments and any lease modifications not
accounted for as separate leases.
Variable lease payments not included in the
measurement of lease liabilities are recognised as an
expense when incurred.
Leases of 12-months or Less and Leases of Low Value
Assets
Lease payments made in relation to leases of 12-months or
less and leases of low value assets (for which a lease asset
and a lease liability has not been recognised) are recognised
as an expense on a straight line basis over the lease term.
Key Accounting Estimates and Judgements
Extension and termination options are included in a
number of leases across the Group. These terms are
used to maximise the operational flexibility of contracts.
The majority of extension and termination options are
exercisable only by the Group and not by the respective
lessor. In determining the lease term management considers
all facts and circumstances that lead to an economic
incentive to exercise an extension option or not exercise
a termination option. Extension options or periods after
termination options are only included in the lease term if the
lease is reasonably certain to be exercised. This assessment
is reviewed if a significant event or significant change in
circumstances occurs which affects this assessment and
that is within the Group’s control. All extension options
have been assumed for the calculations of the Group’s
lease liabilities.
The lease payments are discounted using the interest
rate implicit in the lease. If that rate cannot be readily
determined, which is generally the case for leases in the
Group, the lessee's incremental borrowing rate is used,
being the rate that the individual lessee would have to
pay to borrow the funds necessary to obtain an asset of
similar value to the right-of-use asset in a similar economic
environment with similar terms, security and conditions.
The weighted average incremental borrowing rates
applied by the Group is 5% (2022: 5%). No new leases
were entered into during the period (2022: none) and no
leases were cancelled during the period (2022: four leases
were cancelled).
20
Radius Residential Care Interim Financial Statements 2024
For the six-months ended
In thousands of New Zealand dollars
Unaudited
30 Sep 23
Audited
31 Mar 23
(a) Right-of-use assets
Land and buildings under lease132,816130,552
Accumulated depreciation(20,495)(18,088)
Total carrying amount of right-of-use assets112,321112,464
Reconciliations
Reconciliation of the carrying amount of right-of-use assets at the beginning and end of the financial year:
LAND AND BUILDINGS
Opening carrying amount112,464133,912
Depreciation(2,407)(4,771)
Remeasurements2,26410,428
Disposals — (27,105)
Closing carrying amount112,321112,464
On 6 May 2022, the Group acquired four properties, previously leased from UCG Investments Limited. On acquisition,
the disposal of the related right-of-use assets and lease liabilities resulted in a gain on modification of $1.8m being
recognised upon the cancelling lease and derecognition of the related Lease liabilities and Right of Use assets. Refer
notes 3.2 and 4.1 of the Group's audited consolidated financial statements for the year ended 31 March 2023.
(b) Lease liabilities
CURRENT
Land and buildings 2,4282,428
NON-CURRENT
Land and buildings
120,026119,102
122,454121,530
Unaudited
30 Sep 23
Unaudited
30 Sep 22
(c) Lease expenses and cash flows
Interest expense on lease liabilities 2,991 3,046
Depreciation expense on right-of-use assets 2,407 2,449
Cash outflow in relation to leases4,3404,290
Gain on acquisition of leased property assets—1,781
Unaudited
30 Sep 23
Audited
31 Mar 23
(d) Maturity analysis - contractual undiscounted cash flows
Not later than 1 year8,6958,536
Later than 1 year and not later than 5 years34,62034,245
Later than 5 years
185,748186,242
229,063229,023
21
Radius Residential Care Interim Financial Statements 2024
3. SHAREHOLDER EQUITY AND FUNDING
3.1. Shareholder Equity and Reserves
Accounting Policy
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in
equity as a deduction, net of tax, from the proceeds.
The grant date fair value of equity settled share-based payment arrangements granted to employees is recognised as an
expense, with a corresponding increase in equity.
Unaudited
30 Sep 23
Audited
31 Mar 23
Shares$000Shares$000
Share capital
Authorised, issued and fully paid up capital284,876,74256,820284,848,64456,813
Total contributed equity284,876,74256,820284,848,64456,813
Movements
Opening balance of ordinary shares issued284,848,64456,813269,243,08951,732
Shares issued to Main Family Trust No. 2 — —15,328,0195,000
Shares issued to employees and service
providers
28,098 7 188,385 57
Dividend reinvestment plan — — 89,151 24
Closing balance of ordinary shares issued284,876,74256,820284,848,64456,813
All ordinary shares are authorised and rank equally with one vote attached to each fully paid ordinary share. The shares
have no par value. The Group incurred no transaction costs issuing shares during the year (31 March 2023: Nil).
Shares issued to Main Family Trust No. 2
On 28 September 2022, allotment of 15,328,019 ordinary shares at $0.33 per to the trustees of the Main Family Trust No. 2
as part consideration for the purchase price payable for the acquisition of Matamata Country Lodge business combination
as described in note 5.6 of the Group's audited consolidated financial statements for the year ended 31 March 2023.
The share issue was authorised in accordance with the Directors’ resolution dated 30 August 2022.
Dividends
Dividend distributions to shareholders are recognised as a liability in the period in which dividends are declared.
Unaudited
30 Sep 2023
Audited
31 Mar 2023
Cents per
share
Total $000
Cents per
share
Total $000
Recognised amounts:
Prior year final dividend — —0.761,481
Interim dividend
— —0.701,435
——— 2,916
Interim dividend declared————
Asset Revaluation Reserve
The asset revaluation reserve is used to record the revaluation of freehold land and buildings.
Other Reserve
Other reserve is used to record the reserves arising in relation to share based payments by the Group.
22
Radius Residential Care Interim Financial Statements 2024
3.2. Earnings per share
Basic and Diluted
Basic earnings per share is calculated by dividing the profit after tax of the Group by the weighted average number of
ordinary shares outstanding during the year. Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. As at 30 September
2023, there were no shares with a dilutive effect (2023: none) and therefore basic and diluted earnings per share were
the same.
In thousands of New Zealand dollars
Unaudited
30 Sep 23
Unaudited
30 Sep 22
Profit/(Loss) after tax1,4181,724
Weighted average number of ordinary shares outstanding ('000s)284,866269,411
Cents per share 0.50 0.64
3.3. Borrowings
Accounting Policy
Borrowings are initially recognised at fair value, including transaction costs incurred. Borrowings are subsequently
measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption
amount is recognised in the Statement of Comprehensive Income over the period of the borrowings, using the effective
interest method.
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Audited
31 Mar 23
Secured liabilities
Current
Bank Loans 23,000 23,000
Vendor Loan4.2 10,518 11,518
Related Party Loan4.21,000—
Non-current
Bank Loans
63,16963,169
97,68797,687
23
Radius Residential Care Interim Financial Statements 2024
Terms and Conditions and Assets Pledged as Security
Current
$000
Non-current
$000
Facility Limit
$000
Effective
Interest Rate
%
Expiry Date
30 September 2023
Committed Money Market - A— 20,000 20,000 7.75 %1 November 2026
Committed Money Market - B 15,000 — 15,000 7.28%31 January 2024
Committed Money Market - B— 4,994 5,000 7.28%1 November 2026
Committed Money Market - C— 14,500 14,500 7.26%1 November 2026
Committed Money Market - D— 23,675 23,675 8.75%6 May 2027
Committed Money Market - E 8,000 — 8,000 9.05%31 January 2024
Vendor Loan 10,518 — 10,518 18.00%21 October 2023
Related Party Loan 1,000 — 1,000 18.00%21 October 2023
34,518 63,169 97,693
31 March 2023
Committed Money Market - A — 20,000 20,000 5.60%1 November 2026
Committed Money Market - B 15,000 — 15,000 5.28%6 October 2023
Committed Money Market - B — 4,994 5,000 5.28%1 November 2026
Committed Money Market - C — 14,500 14,500 4.98%1 November 2026
Committed Money Market - D — 23,675 23,675 6.68%6 May 2027
Committed Money Market - E 8,000 — 8,000 6.70%6 October 2023
Vendor Loan 11,518 — 11,518 8.00%21 October 2023
34,518 63,169 97,693
Vendor Loan
The vendor loan is deferred consideration payable following the Matamata business acquisition. The amount represents
a payable of $10.5m bearing interest at 18% per annum as at 30 September 2023. On 3 May 2023 the Company agreed
to repay $1m of the vendor loan and a revised interest rate of 18% per annum from 1 April 2023 (30 September 2023: 8%
per annum) until an extended maturity date of 21 October 2023. Interest of 12% per annum (of the total 18%) is payable
monthly in arrears and 6% per annum is capitalised monthly and repayable at the end of the loan term. On 5 October 2023,
prior to the expiry of the loan, $5.6m of the loan balance was repaid with an extension was granted for the remaining loan
balance through to 30 April 2024 with a revised interest rate of 16% per annum in arrears at the end of each calendar
month. The vendor loan is secured by a first ranking security over the land and building assets acquired as part of the
Matamata acquisition.
Related Party Loan
On 15 May 2023 the trustee of the Providence Trust, a related party of Executive Chairman Brien Cree, agreed to lend the
Group subsidiary that owns the Matamata Country Lodge Business $1m at 18% per annum. The loan was subsequently
repaid in full on 1 November 2023.
Security
The bank loans of the Group are guaranteed by certain Group entities and secured by mortgages over the Group's care
centre freehold land and buildings and rank second behind the Statutory Supervisors when the land and buildings are
classified as investment property and investment property under development.
As at 30 September 2023 the balance of the bank loans over which the properties are held as security is $86.2m (31 March
2023: $86.2m), the total commitment as at 30 September 2023 is $86.2m (31 March 2023: $86.2m).
24
Radius Residential Care Interim Financial Statements 2024
Overdraft Facility
As at 30 September 2023, the Group has a Corporate
Banking Overdraft Facility Agreement with ASB Bank
Limited for $4m (31 March 2023: $5m) of which $0.5m is
due to expire on 31 December 2023 with a further $1.5m due
to expire on 31 January 2024. The remaining $2m is due to
expire on 31 March 2049 (31 March 2023: $3m due to expire
on 31 July 2023 with the remaining $2m due to expire on
31 March 2049). This facility bears interest at an effective
interest rate of 8.70% (31 March 2023: 6.28%) and is secured
over the assets of the Group and guaranteed by certain
Group entities. At 30 September 2023 there was no amount
drawn down of the facility (31 March 2023: $2.9m).
Financing Arrangements
Under the Group’s bank loan arrangements with ASB
Bank Limited, the Group must comply with externally
imposed banking covenants. These covenants are tested
and reported to the ASB on a quarterly basis. During the
period ended 30 September 2023, the Group complied
with all externally imposed banking covenant requirements
to which it is subject (2023: complied with all). The Group
has agreed with its bank that the calculation of Adjusted
EBITDA (Earnings Before Interest, Tax, Depreciation and
Amortisation) and Net Interest, for the purposes of the
financial covenants, shall continue to be based on the
accounting treatment in use before the introduction and
adoption of NZ IFRS 16 Leases (2023: The Group has
agreed with its bank that the calculation of Adjusted
EBITDA (Earnings Before Interest, Tax, Depreciation and
Amortisation) and Net Interest, for the purposes of the
financial covenants, shall continue to be based on the
accounting treatment in use before the introduction and
adoption of NZ IFRS 16 Leases). Following the Matamata
business acquisition on 29 September 2022 it was agreed
that the assets, liabilities and operating results arising from
this acquisition would sit outside of the lending group and
would therefore not be included in the calculation of any
externally imposed banking covenants by ASB Bank Limited.
On 29 September 2023, a four-month extension was
granted by ASB relating to $23m of finance facilities (being
the current portions of the Committed Money Market B
and E facilities above) that were originally put in place to
enable settlement of the four previously leased land and
buildings property assets from UCG Investments Limited.
These finance facilities now need to be repaid on or before
31 January 2024. The amendments include a revised event
of review that requires the Company to have received an
unconditional sale and purchase agreement for the property
and business of two care homes by 8 December 2023.
The Board and management have subsequently updated
the debt management programme which sets out the
Group's intentions for the repayment of borrowings due for
repayment by 31 January 2024. Further information in this
can be found within note 1.1.
On 5 October 2023, the group subsidiary that owns the
Matamata Country Lodge Business, entered into a six month
funding agreement through to 31 March 2024 with MRFT
Finance Limited for $6m to assist with the partial repayment
of $5.6m of the Vendor Loan along with capitalised interest
of $0.3m and associated lending fees. The agreement incurs
interest of 12% per annum repayable at the expiry of the
agreement and has a three month extension option which
can be exercised by the Company by written notice through
to 30 June 2024.
25
Radius Residential Care Interim Financial Statements 2024
4. OTHER DISCLOSURE
4.1. Income Tax
Accounting Policy
Current income tax expense or credit is the tax payable on
the current period's taxable income based on the applicable
income tax rate adjusted by changes in deferred tax assets
and liabilities.
Deferred tax assets and liabilities are recognised for
temporary differences at the applicable tax rates when the
assets are expected to be recovered or liabilities are settled.
Deferred tax liabilities are not recognised if they arise from
the initial recognition of goodwill. Deferred income tax is
also not recognised if it arises from the initial recognition
of an asset or liability in a transaction other than a business
combination that at the time of the transaction affects
neither accounting nor taxable profit or loss.
Deferred tax assets are recognised for deductible
temporary differences and unused tax losses only if it is
probable that future taxable amounts will be available to
utilise those temporary differences and losses.
Current and deferred tax balances attributable to
amounts recognised directly in equity are also recognised
directly in equity.
Key Accounting Estimates and Judgements
Deferred Tax on Investment Property
Deferred tax on investment property is assessed on the
basis that the asset value will be realised through use (“Held
for Use”).
An initial recognition exemption has been applied to newly
developed village sites in accordance with NZ IAS 12
Income Taxes.
The Group’s ORAs comprise two distinct cash flows (being
an ORA deposit upon entering the unit and the refund
of this deposit upon exit). In determining the tax base of
investment property, the Group considered whether taxable
cash flows are received at the end of the ORA period (i.e.
upon refund of the ORA deposit by way of set off on exit
by a resident) or at the beginning of the ORA period (i.e.
at time of the receipt of the ORA deposit). The Group
has carefully evaluated all the available information and
considers it appropriate to recognise and measure the tax
base and associated deferred tax based on the taxable cash
flows being receivable at the end of the ORA period as this
best represents the Group’s contractual entitlement.
In calculating deferred tax under the Held for Use
methodology, the Group has made significant judgements
to determine taxable temporary differences. The carrying
value of the Group’s investment property is determined
on a discounted cash flow basis and includes cash flows
that are both taxable and non-taxable in the future. The
Group has recognised deferred tax on the cash flows with
a future tax consequence being Deferred Management
Fee (DMF) as provided by LVC, to the extent that it arises
from depreciable components (i.e. buildings) of the
investment property. The Group uses the valuers valuations
to estimate the apportionment of cash flows arising
from the depreciable (i.e. buildings) and non-depreciable
components (i.e. land).
26
Radius Residential Care Interim Financial Statements 2024
For the six-months ended
In thousands of New Zealand dollars
Unaudited
30 Sep 23
Unaudited
30 Sep 22
(a) Components of tax expense
Current tax4113
Deferred tax
219351
223464
(b) Income tax reconciliation
The prima facie tax payable on profit before tax is reconciled to the income tax
expense as follows:
Prima facie income tax payable on profit before tax at 28.0%455613
Permanent differences(317)(217)
(Over)/Under provision for income tax in prior year853
Other—65
Income tax expense attributable to profit223464
Unaudited
30 Sep 23
Audited
31 Mar 23
(c) Deferred tax
Deferred tax relates to the following:
Non-current asset
Deferred tax assets
The balance comprises:
Lease liabilities34,28734,028
Provisions2,0672,091
Deferred management fee income1,1771,281
Tax losses
27539
37,55837, 9 3 9
Deferred tax liabilities
The balance comprises
Property, plant and equipment2,5572,679
Right-of-use assets
31,450 31,490
34,00734,169
Net deferred tax assets3,5513,770
Unaudited
30 Sep 23
Unaudited
30 Sep 22
(d) Deferred income tax revenue comprises:
Through profit included in income tax expense
Decrease/(Increase) in deferred tax assets3816,552
Decrease in deferred tax liabilities(162)(6,101)
Increase in deferred tax liabilities as a result of acquisition
—(100)
219351
Through other comprehensive income
Increase in deferred tax liabilities
——
21935
1
Deferred tax assets are recognised for deductible temporary differences as Management considers that it is probable
that future taxable profits will be available to utilise those temporary differences.
27
Radius Residential Care Interim Financial Statements 2024
Unaudited
30 Sep 23
Audited
31 Mar 23
(E) Imputation credits available for use in subsequent periods
Balance at the beginning of the year6,0166,735
Dividends paid —(1,134)
New Zealand tax payments, net of refunds —415
Balance at the end of the period6,016 6,016
4.2. Related Party Transactions
Subsidiaries are entities controlled by the Group. The Group controls an entity when it is exposed to, or has rights
to, variable returns from its involvement with the entity and has the ability to affect those returns through its power
over the entity.
The financial statements of subsidiaries are prepared for the same reporting period as the parent entity, using consistent
accounting policies. Adjustments are made to bring into line any dissimilar accounting policies which may exist.
All intercompany transactions and balances are eliminated. The subsidiaries are consolidated from the date the Group gains
control until the date on which control ceases.
Subsidiaries
The following are the Group’s subsidiaries:
Name of EntityPrincipal Activities
Ownership Interests
and Voting Rights
Class of Shares
Unaudited
30 Sep 23
Audited
31 Mar 23
Radius Matamata
Retirement Village Limited
Operating entity for Matamata
Retirement Village
100%100%Ordinary
Radius SPV Limited
Property owning entity for
Matamata Country Lodge and Matamata
Retirement Village.
100%100%Ordinary
RConnect Limited
Staff placement company providing
short term staffing solutions
100%100%Ordinary
Radius Arran Court
Limited
Lessee entity for Radius Arran Court care
home
100%100%Ordinary
Windsor Lifestyle Estate
Limited
Operating entity for Windsor retirement
village
100%100%Ordinary
Radius Care
Limited (non-trading)
Dormant100%100%Ordinary
Elloughton Grange
Village Limited
Operating entity for Elloughton
retirement village
100%100%Ordinary
Radius Care Holdings
Limited
Property owning entity for St Helenas,
Thornleigh Park, Lexham Park, Elloughton
Gardens, Heatherlea, Windsor Court,
Taupaki Gables, Peppertree, Arran Court,
St Joans and Fulton care homes
100%100%Ordinary
Clare House Retirement
Village Limited
Operating entity for Clare House
Retirement Village and property owning
entity for the Clare House care home
100%100%Ordinary
Clare House Care LimitedOperating entity for Clare House Care100%100%Ordinary
All subsidiaries are incorporated in New Zealand and have a balance date of 31 March.
28
Radius Residential Care Interim Financial Statements 2024
Key Management Personnel Compensation and Other Related Parties
Key management personnel are all Directors and senior management with the authority for the strategic direction and
management of the Group.
Related PartyRelationship
Brien CreeDirector and Ultimate Shareholder (via Wave Rider Holdings Limited)
Duncan CookDirector and Shareholder
Bret JacksonDirector and Ultimate Shareholder (via Takatimu Investments Limited)
Mary GardinerDirector
Hamish StevensDirector and Shareholder
Tom WilsonDirector and Shareholder
Wave Rider Holdings LimitedShareholder
Takatimu Investments LimitedShareholder
Cibus Catering LimitedCommon Director (Brien Cree)
Providence TrustTrustee (Brien Cree)
Valhalla Capital LimitedCommon Director (Brien Cree)
Ohaupo Holdings LimitedCommon Shareholder (Neil Foster)
Time Capital NZ LimitedCommon Director and Shareholder (Tom Wilson)
Neil FosterShareholder
Warehouse Storage LimitedCommon Shareholder (Neil Foster)
Main Family Trust No. 2Shareholder
29
Radius Residential Care Interim Financial Statements 2024
For the six-months ended
In thousands of New Zealand dollars
Unaudited
30 Sep 23
Unaudited
30 Sep 22
Directors' remuneration and expenses299208
Dividends to Director related entities—559
Key management personnel salaries and other short term employee benefits1,6571,232
Key management personnel dividends
— 6
1,9562,005
In thousands of New Zealand dollars
NOTE
Unaudited
30 Sep 23
Audited
31 Mar 23
Other related parties
Trade creditors
- Cibus Catering Limited69986
Trade debtors
- Cibus Catering Limited1814
Borrowings
- Main Family Trust No. 2 (vendor loan)3.310,51811,518
- Providence Trust (related party loan)3.31,000—
In thousands of New Zealand dollars
Unaudited
30 Sep 23
Unaudited
30 Sep 22
Catering services
- Cibus Catering Limited3,9833,418
Consulting fees
- Duncan Cook
1
104395
- Time Capital NZ Limited
2
8—
Rent paid
- Warehouse Storage Limited 616395
Rent received and utility recharges
- Cibus Catering Limited3241
Personal Guarantee fee
- Brien Cree8583
Business acquisition
- Main Family Trust No. 2
3
—17,018
Vendor loan interest
- Main Family Trust No. 2
3
642—
Related party loan interest
- Providence Trust91—
1. Predominately relates to services provided in respect of his role as Legal Counsel for the Company. Prior period includes additional services provided during the
Matamata Country Lodge acquisition and the UCG transaction.
2. Relates to services provided since Tom Wilson (Director of Time Capital NZ Limited) appointment as Director of Radius Residential Care Limited during August 2023.
3. Main Family Trust No. 2 became a related party after the purchase of the Matamata business and the issue of share capital described in note 3.1 as part of the
consideration paid for this business.
30
Radius Residential Care Interim Financial Statements 2024
Assignment of an Agreement for the Purchase of Land
from a Director
Brien Cree (Director) and the Group are party to an
agreement (“the Assignment Agreement”), whereby, Mr
Cree has agreed to assign to the Group his rights under
an agreement for sale and purchase of real estate (“Land
SPA”), to acquire a circa 4.3 hectare development property
at Main North Road, Belfast, Christchurch (‘the development
property’) from an unrelated third party.
The purchase price under the Land SPA is $5.8m, of which
a non-refundable deposit of $300k was paid by Mr Cree
during the 2021 financial year. On the date of settlement,
being 16 April 2021, the Group paid Mr Cree $700k of
which $400k was for the assignment of the agreement to
purchase the land and $300k for the reimbursement of the
deposit.
A condition of the Assignment Agreement was approval
of the transaction by the Board of the Group by 2 April
2021. On 2 April 2021 the Board (excluding Mr Cree as
an interested Director) exercised its right to approve the
Assignment Agreement and the Group now holds the rights
to acquire the development property.
The Board approved the Assignment Agreement on 2 April
2021 on the basis the Group had obtained:
• resource consent and funding for the development of an
integrated aged care facility and retirement village on the
property; and
• an independent valuation had confirmed that the
property’s fair value after resource consent exceeded the
purchase price of the property (including the additional
$400k consideration payable to Brien Cree).
The balance of the purchase price under the land sale and
purchase agreement amounting to $5.5m is payable to the
third party vendor on settlement, which will be completed
when the title of the property is issued. It is currently
expected that title will be issued in mid 2024.
4.3. Long Term Incentive (LTI) Plan
On 18 July 2022 the Board approved a new Long Term
Incentive Scheme for its senior executives (“LTI Scheme”).
The LTI Scheme has been established to:
• provide an incentive to key executives to commit to
Radius Care for the long term; and
• align these executives’ interests with the interests of
Radius’ shareholders.
Participants in the Scheme will be granted Performance
Share Rights (“PSRs”) from time to time which will, on
vesting, convert into an entitlement to receive ordinary
shares. Vesting will depend on achievement of certain
conditions relating to Radius Care share price.
PSRs become exercisable if the holder remains employed
on the vesting date and conditions are met over the period
from the commencement date to the measurement date,
and in certain other exceptional circumstances.
On becoming exercisable, each PSR will entitle the holder to
receive one fully paid ordinary share in Radius Care Limited,
less an adjustment for tax paid on the holder’s behalf for the
benefit received under the Scheme.
The Share Rights have a nil exercise price.
Performance Hurdles
All PSRs will vest into ordinary shares in Radius if the 10-
day volume weighted average price (“VWAP”), for the 10
trading days immediately prior to (and not including) 18
July 2025, is equal to or greater than $1.081. This is three
times the 10-day VWAP of 18 July 2022 (“Base Price”).
If the 10-day VWAP is between $1.027 and $1.081 (being
95% and 100% of three times the Base Price), the Radius
Care Board has discretion to scale the number of a
Participant’s PSRs that will vest.
Recognition and Measurement
• On 18 July 2022, 4,164,844 share rights were issued
for nil consideration and a nil exercise price in
relation to the LTI Scheme.
• On 15 August 2022, 1,109,824 share rights were
issued for nil consideration and a nil exercise price in
relation to the LTI Scheme.
During the period, 1,387,281 share rights were forfeited and
no share rights were exercised or expired during the period.
The fair value of the share rights were determined using the
Monte Carlo valuation approach.
31
Radius Residential Care Interim Financial Statements 2024
4.4. Revenue
Revenue from care and village fees and recoveries income is recognised in accordance with NZ IFRS 15 Revenue from
Contracts with Customers (“NZ IFRS 15”). Deferred management fees and rental income are considered leases under NZ
IFRS 16 Leases (“NZ IFRS 16”), and are therefore excluded from the scope of NZ IFRS 15. None of the Group’s revenue, as
defined by NZ IFRS 15, contains significant financing components.
For further information on the Group's Revenue accounting policies refer to note 2.1 of the Group's Consolidated Financial
Statements for the year ended 31 March 2023.
Unaudited
30 Sep 23
Unaudited
30 Sep 22
Rest home, hospital and dementia fees71,003 59,565
Accommodation supplement fees4,789 3,665
Village service fees569 330
Rental income79 48
Other services provided to residents6,8685,493
83,308 69,101
4.5. Contingent Liabilities
There has been no change to contingent liabilities disclosed
in the 2023 annual financial statements.
4.6. Commitments
At 30 September 2023, the Group has capital commitments
of $34,165 (31 March 2023: $390,566).
There are no significant unrecognised contractual
obligations entered into for future repairs and maintenance
at reporting date.
4.7. Events Subsequent to Reporting Date
New Banking Arrangements
The Group has entered into some amendments with respect
to its borrowing arrangements as set out in Note 3.3.
Repayment of Related Party Loan
On 1 November 2023, a $1m loan with Providence Trust,
a related party of Executive Chairman Brien Cree was
repaid in full.
Other
There has been no other matter or circumstance which
has arisen since 30 September 2023 that has significantly
affected or may significantly affect:
a. the operations, in financial years subsequent to 30
September 2023, of the Group or
b. the results of those operations or
c. the state of affairs, in financial years subsequent to 30
September 2023, of the Group.
32
Radius Residential Care Interim Financial Statements 2024
33
Level 9, 45 Queen Street, Auckland 1010
PO Box 3899, Auckland 1140
New Zealand
T:+64 9 309 0463
F:+64 9 309 4544
E:auckland@bakertillysr.nz
W:www.bakertillysr.nz
INDEPENDENT AUDITOR’S REVIEW REPORT
To the Shareholders of Radius Residential Care Limited
Report on the review of thecondensed consolidated interim financial statements
Conclusion
Wehave reviewed the condensed consolidated interim financial statements of Radius Residential Care Limited and
its subsidiaries (together "the Group") on pages 7to 32, which comprise the condensed consolidated interim
statement of financial position at 30 September 2023, the condensed consolidated interim statement of
comprehensive income, condensed consolidated interim statement of changes in equity and condensed
consolidated interim statement of cash flows for the period then ended, and the notes to the condensed consolidated
interim financial statements that include a summary of significantaccounting policies and other explanatory
information.
Based on our review, nothing has come to our attention that causes us to believe that these condensed consolidated
interim financial statements of the Group do not present fairly, in all material respects, the financial position of the
Group as at 30 September 2023, and of its financial performance and its cash flows for the six-months ended on that
date, in accordance with in accordance with New Zealand Equivalent to International Accounting Standard 34: Interim
Financial Reporting (‘NZ IAS 34’)and International Accounting Standard 34: Interim Financial Reporting (‘IAS 34’).
This report is made solely to the Shareholders of Radius Residential Care Limited. Our review work has been
undertaken so that we might state those matters which we are required to state to them in our review report and for
no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other
than Radius Residential Care Limited and the Shareholders of Radius Residential Care Limited, for our review
procedures, for this report, or for the conclusions we have formed.
Basis for Conclusion
We conducted our review in accordance with NZ SRE 2410 (Revised) Review of Financial Statements Performed
by the Independent Auditor of the Entity. As the auditor of the Group, NZ SRE 2410 (Revised) requires that we
comply with the ethical requirements relevant to the audit of the annual financial statements and we have
fulfilled our other ethical responsibilities in accordance with these ethical requirements.
Other than in our capacity as auditorand provider of other assurance services, our firm carries out other
assignments for the Group in the area of taxation compliance services. The firm has no other interest in the
Group. The provision of these services has not impaired our independence as auditors of the Group.
34
Material Uncertainty Related to Going Concern Basis of Accounting
We draw attention to Note 1.1and 3.3in the condensed consolidated interim financial statements, which states that
as at 30September 2023, the Group’s current liabilities exceeded its current assets by$15.0m(excluding refundable
occupation right agreements’ related liabilities of $35.8m) and the Group has borrowings of $34.5m due for
repayment within 12 months of reporting date. As stated in Note 1.1, these events and conditions, along with other
matters as set forth in Note 1.1and 3.3, indicate thata material uncertainty exists that may cast significant doubt on
the Group’s ability to continue as a going concern. If the Group were unable to continue in operational existence for
the foreseeable future, adjustments may have to be made to reflect the situation that assets may need to be realised
other than in the amounts at which they are currently recorded in the Statement of Financial Position. In addition, the
Group may need to provide for future liabilities that might arise and to reclassify non-current liabilities as current
liabilities in the Statement of Financial Position. Our opinion is not modified in respect of this matter.
Emphasis of Matter –Valuation of Investment Properties and Freehold Land and Buildings
We draw attention to Note 2.1 and 2.2 of the condensed consolidated interim financial statements, which describes
as at 31 March 2023, the Group’s independent external property valuer included a valuation uncertainty clause in the
reports, stating that the property markets experienced strong growth throughout 2021 and much of 2022. However,
due to recent Government lending controls, global supply issues, abnormally high inflation and rapidly rising interest
rates, they have seen a slowdownin markets generally with declining asset values, and an economic downturn
(recession) is seen as a risk going forward. Sales transaction volumes have decreased significantly as there is a
disconnect between vendor expectation and the price purchasers are prepared to pay due to the large increase in
interest rates over a short timeframe. Therefore, less certainty and a higher degree of caution should be attached to
the valuationsthan would normally be the case. The valuer recommended that the valuations are revisited more
frequently. Thisclauserepresents an increase in the significant estimation uncertainty in the valuation of investment
properties and freehold land and buildings. Our conclusion is not modified in respect of this matter.
Directors’ Responsibilities
The Directors are responsible, on behalf of the Group, for the preparation of these condensed consolidated interim
financial statements in accordance with generally accepted accounting practice in New Zealand that give a fair
presentation of the matters to which they relate, and for such internal control as the Directors determine is necessary
to enable the preparation of condensed consolidated interim financial statements that are free from material
misstatement, whether due to fraud or error.
Auditor's Responsibilities
Our responsibility is to express a conclusion on the condensed consolidated interim financial statements based on
our review. NZ SRE 2410 (Revised) requires us to conclude whether anything has come to our attention that causes
us to believe that the interim financial statements, taken as a whole, are not prepared in all material respects, in
accordance with NZ IAS 34 and IAS 34.
A review of condensed consolidated interim financial statements in accordance with NZ SRE 2410 (Revised) is a
limited assurance engagement. The auditor performs procedures, consisting of making enquiries, primarily of
persons responsible for financial and accounting matters, and applying analytical and other review procedures.
35
The procedures performed in a review are substantially less than those performed in an audit conducted in
accordance with International Standards on Auditing (New Zealand) and consequently does not enable us to obtain
assurance that we might identify in an audit. Accordingly, we do not express anaudit opinion on the condensed
consolidated interim financial statements.
Matters Relating to the Electronic Presentation of the Condensed Consolidated Interim Financial
Statements
This review report relates to the condensed consolidated interim financial statements of the Group for the six-
month period ended 30 September 2023included on the Group’s website. The Directors of the Group are
responsible for the maintenance and integrity of the Group’s website. We have not been engaged to report on
the integrity of the Group’s website. We accept no responsibility for any changes that may have occurred to the
condensed consolidated interim financial statements since they were initially presented on the website.
The review report refers only to the condensed consolidated interim financial statements named above. It does
not provide a conclusion on any other information which may have been hyper linked to / from these condensed
consolidated interim financial statements. If readers of this report are concerned with the inherent risks arising
from electronic data communication, they should refer to the published hard copy of the review condensed
consolidated interim financial statements and related auditor’s review report dated 27 November2023to
confirm the information included in the reviewed condensed consolidated interim financial statements
presented on this website.
Legislation in New Zealand governing the preparation and dissemination of condensed consolidated interim
financial statements may differ from legislation in other jurisdictions.
The engagement partner on the review resulting in this independent auditor’s review report S Patel.
BAKER TILLY STAPLES RODWAY AUCKLAND
Auckland, New Zealand
27November 2023
Radius Residential Care
ADDRESS
Level 4, 56 Parnell Road, Parnell, Auckland
PHONE
+64 9 304 1670
EMAIL
investor@radiuscare.co.nz
Caring is our calling
---
Half Year Result
FOR 6 MONTHS TO 30 SEPTEMBER 2023
21HY24 Investor Presentation
Presenting
Today
Jeremy Edmonds
Chief Financial Officer
BA, BCom, CA
Andrew Peskett
Chief Executive Officer
BA (Hons), LLB
31HY24 Investor Presentation
Agenda
OVERVIEW OF 1HY24
PERFORMANCE
Delivered strong operating
performance and profitability
ANALYSIS OF
RESULT
Strong performance
demonstrating our leadership in
specialist care offerings
POSITIONING
RADIUS CARE
Strategy update
APPENDICESKey operational and financial
metrics
Summary Profit and Loss, Balance
Sheet and Cash Flow
Radius Taupaki Gables
Overview of
DELIVERED STRONG
OPERATING PERFORMANCE
AND PROFITABILITY
1HY24Performance
51HY24 Investor Presentation
1HY24 Business Highlights
Record first half
Strong Operating Performance
•
Record first half trading with 50%
increase in Underlying EBITDA
1
.
Achieved upper end of guidance
issued to the market.
•
Successful execution of business
improvement programme to
streamline operations.
•
Increased commercial intensity
delivering 21 village unit sales.
Continued Strong Occupancy
High occupancy of 93.0% as at 30
September. Maintaining occupancy level
well above industry average.
Fully Staffed
Successful recruitment of overseas nurses and
establishment of RConnect staffing bureau
business resulting in more efficient rosters,
significantly reduced turnover, reduced external
staffing costs and enabling an improved
Hospital bed mix.
Value from Strategic Acquisitions
Continuing strong operating performance
following acquisition of Matamata Country
Lodge.
1 Earnings before interest, tax, depreciation and amortisation. Underlying EBITDA is a non-GAAP (unaudited)
financial measure which is reconciled to GAAP measures included within the Appendices of this Investor
Presentation.
61HY24 Investor Presentation
1HY24 FinancialHighlights
Financial Performance
•
Underlying EBITDA up 50% to $10.5m with no
underlying adjustments made for the 1HY24
period as opposed to $1.5m of adjustments in the
prior comparative period.
•
Reported Net Profit After Tax of $1.4m, downfrom
a profit of $1.7m in 1HY23, which included $1.8m of
one-off gains related to previously leased
properties.
•
AFFO
1
of $2.9m, up from $2.5m.
•
Underlying EBITDAR
2
(for the 6 months to 30
th
September 2023) per care bed of $12.2k up 15%
from 1HY23.
•
Accommodation supplements increased 31% to
$4.8m.
Balance Sheet Position
•
Total assets of $355.0m.
•
Investment properties of $71.5m, up $1.3m
from FY23.
•
Total borrowings of $97.7m, consistent with
FY23.
•
Assets held for sale $25.7m.
1 AFFO is a non-GAAP (unaudited) financial measure which is reconciled to GAAP measures included within
the Appendices of this Investor Presentation.
2 Earnings before interest, tax, depreciation, amortisation and rent. Underlying EBITDAR is a non-GAAP
(unaudited) financial measure.
71HY24 Investor Presentation
Our People
Successfully recruited Registered Nurse vacancies. We
have surplus nurses who are supporting RConnect staffing
bureau for internal and external customers.
28% year on year reduction in Registered Nurse turnover.
Registered Nurse turnover significantly below sector
average.
Development/training opportunities in place for roles at
our care homes.
81HY24 Investor Presentation
Radius St Helenas
Analysis ofResult
STRONG PERFORMANCE
DEMONSTRATING OUR
LEADERSHIP IN SPECIALIST
CARE OFFERINGS
Radius Taupaki Gables
91HY24 Investor Presentation
64.9
69.9
84.5
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
90.0
$m
1HY221HY231HY24
Financial
Performance
Overview
Continued strong
occupancy and
successful execution of
business improvement
programme have
materially lifted
Underlying EBITDA.
$m
1 Total revenue excludes other income
5.1
7.0
10.5
0.0
2.0
4.0
6.0
8.0
10.0
12.0
1HY221HY231HY24
Underlying EBITDA
Underlying EBITDA of $10.5m, up 50% vs pcp
Total Revenue
1
1HY24 Revenue of $84.5m up 21% vs pcp
101HY24 Investor Presentation
Occupancy
1 Source: Industry Information based on NZACA Occupancy –Te Whatu Ora Aged Residential Care Quarterly Reporting Survey as at 30June 2023. Includes ORA ARRC-certified beds and their residents
Consistent occupancy of 93.0% at 30 September 2023 remaining well above industry average
1
92.7%
93.7%
93.4%
93.1%
92.0%
92.3%
92.0%
91.4%
91.9%
91.7%
93.3%
90.9%
93.0%
88.0%
87.8%
87.2%
87.3%
86.1%
86.2%
85.8%
85.2%
85.4%
86.1%86.1%
86.6%
84
85
86
87
88
89
90
91
92
93
94
95
Sep-20Dec-20Mar-21Jun-21Sep-21Dec-21Mar-22Jun-22Sep-22Dec-22Mar-23Jun-23Sep-23
Occupancy rate %
Radius Care (monthly) Industry average (quarterly)
111HY24 Investor Presentation
Strong Hospital bed mix versus prior years enabled by fully staffed care homes
Hospital Bed Mix
700
750
800
850
900
950
AprilMayJuneJulyAugust September October November December JanuaryFebruaryMarch
Occupied Beds
FY22FY23FY24
121HY24 Investor Presentation
10.3
10.6
12.2
8.0
9.0
10.0
11.0
12.0
13.0
1HY221HY231HY24
ContinuedStrong Accommodation Supplements and
Underlying EBITDAR per Care Bed
Underlying EBITDAR per Care Bed
1
(for the 6 months to 30th September 2023)
1
Underlying EBITDAR for aged care segment divided by the average number of care beds occupied during the period
Market leading returns
3.1
3.7
4.8
0.0
1.0
2.0
3.0
4.0
5.0
6.0
1HY221HY231HY24
Accommodation Supplements
$m
$000
131HY24 Investor Presentation
AFFO
$m
2.3
2.5
2.9
0.0
1.0
2.0
3.0
4.0
1HY221HY23
1HY24
AFFO of $2.9m, up on
the $2.5m earned in
the comparative
period.
Available Funds From Operations ($m)
141HY24 Investor Presentation
Strategy
Update
Radius Taupaki Gables
151HY24 Investor Presentation
StrategyUpdate
Acquisition of strategically
important facilities
operated by Radius Care
Opportunistic value
accretive acquisitions
Brownfield
developments
Greenfield
developments
•
Since listing Radius Care has
demonstrated successful execution
against its core strategic pillars
such as the successful integration
of Matamata Country Lodge.
Core Strategic Pillars
•
Continue to pursue several
opportunities to build scale (for
example M&A, brownfield and
greenfield developments).
•
Revenue diversification –
extension of care
offerings to other areas of
the Health Sector.
161HY24 Investor Presentation
Outlook
Improved operating results and momentum in first half
results to continue for the remainder of the financial year.
Focus on commercial opportunities to continue to drive
revenue growth and improved margins through increased
premium revenue and new business.
The Board expects to resume dividend payments following
completion of the debt management programme.
171HY24 Investor Presentation
Appendices
Radius Taupaki Gables
181HY24 Investor Presentation
The Radius Care growth pipeline provides unique exposure to a high acuity, specialised care provider that remains committed to and focused
on delivering compassionate and outstanding clinical care outcomes.
With an absolute focus on our core business, Radius Care delivers industry leading metrics, including EBITDAR per bed.
Key Investment Highlights
Demand underpinned bypopulation
demographics
1
Portfoliooriented to high acuity and specialist care
2
1 Source: Statistics New Zealand
2 Source: Ministry of Health audit reports as disclosed on Ministry of Health website –https://www.health.govt.nz/your-health/certified-providers/aged-care/based on data as at 13 October 2023
APPENDIX 1
Average additional offerings (Psychogeriatric, Physical, Intellectual,
Dementia) per care home
0.0%
2.0%
4.0%
6.0%
8.0%
2003 2008 2013 2018 2023 2028 2033
Rolling 5-year pop CAGR
65 - 85 5-yr CAGR85+ 5-yr CAGR
1.0
0.8
0.5
0.4
0.3
RadiusRYMARVOCASUM
191HY24 Investor Presentation
At a Glance
1,889
CareBeds
1,860
+
Employees
92.7%
CareBeds
7.3%
ILUs
National aged care focused portfolio with strong regional presence,
owing 13 and leasing 11 of the 24 sites nationwide
ILUs are Independent Living Units
APPENDIX 2
201HY24 Investor Presentation
Key operational and financial metrics
Operating Metrics
1HY241HY231HY221HY21
Number of Care Beds (period end)
1
1,8891,8651,7151,714
Average Care Bed Occupancy
2
91.9%91.5%93.0%91.6%
Underlying EBITDAR per Care Bed
3
(000s)$12.2$10.6$10.3$10.7
Number of Units (period end)
4
1481477676
Number of new Unit sales--42
Number of existing Unit resales213-1
Realised gains on resales (m)$1.4$0.2--
Realised development margins (m)--$0.1$0.2
Cash DMF realised upon resale (000s)$67$140-$15
Average resale price (000s)$386$445-$300
Average new unit sale price (000s)--$403$425
1 Comprises Care Beds occupied, available to be occupied or unavailable due to refurbishment
2 Total occupied Care Bed days divided by total Care Bed days available during the period
3 Pro forma Underlying EBITDAR for aged care (as set out in the lower right table) divided by the average number of
Care Beds occupied during the period
Accommodation Supplements
1HY241HY231HY221HY21
Accommodation Supplements Revenue
$4.8m$3.7m$3.1m$2.7m
Number of Care Beds (period end)
1
1,8891,8651,7151,714
Number of Available Care Beds with
Accommodation Supplements
1,2891,2651,1471,146
Percentage of Care Beds with
Accommodation Supplements
68.2%67.8%66.9%66.9%
•30% over three years
•average resident tenure is 4.2 years
4 Comprises Units occupied, available to be occupied or unavailable due to refurbishment
5 Total revenue excludes Other income
DMF terms for Retirement Village units
APPENDIX 3
211HY24 Investor Presentation
($000)1HY241HY231HY22
Revenue
Revenue83,30869,10164,458
Deferred management fees1,162768449
Total revenue84,47069,86964,907
Change in fair value of investment property1,350175(65)
Government subsidy received-154-
Interest income335032
Gain on acquisition of previously leased property assets-1,7811,403
Gain on business acquisition-927-
Total revenue and other income85,85372,95666,277
Expenses
Employee costs(52,477)(44,341)(39,292)
Depreciation expense(5,143)(4,986)(5,746)
Finance costs(8,008)(5,344)(4,590)
Other expenses(18,584)(16,097)(14,987)
Total expenses(84,212)(70,768)(64,615)
Profit/(Loss) before income tax1,6412,1881,662
Income tax expense(223)(464)(328)
Profit for the period
1,418
1,7241,334
•
Revenue up 21% to $84.5m.
•
Underlying EBITDA up 50% to
$10.5m.
•
Reported Net Profit After Tax
of $1.4m downfrom a profit of
$1.7m in 1HY23, which included
$1.8m of one off gains relating
to previously leased
properties.
•
Underlying EBITDAR per Care
Bed up 15% to $12.2k.
Financials
Statement of
Comprehensive Income
APPENDIX 4
221HY24 Investor Presentation
($000)1HY24FY23FY22
Assets
Cash and cash equivalents9085152,088
Trade and other receivables13,77013,0719,842
Held for sale assets25,704891-
Inventories708753768
Current tax assets-1,321-
Investment properties71,47370,14346,014
Property, plant and equipment110,879133,87073,839
Right-of-use assets112,321112,464133,912
Intangible assets15,70219,79719,797
Deferred tax assets3,5513,7703,885
Total assets355,016356,595290,145
Liabilities
Cash and cash equivalents (overdraft)-2,894-
Trade and other payables17,23520,54316,901
Current tax liabilities--444
Borrowings97,68797,68730,000
Deferred management fees7,5866,9731,553
Refundable occupation right agreements35,76434,10428,616
Lease liabilities122,454121,530142,543
Total liabilities280,726283,731220,057
Net assets74,28972,86470,088
Equity
Share capital56,82056,81351,732
Reserves9,5399,5296,812
Retained earnings7,9306,52211,544
Total equity74,28972,86470,088
•
Investment properties of
$71.5m, up $1.3m from FY23.
•
Property, plant and equipment
of $110.9m, down $23.0m from
FY23 due to held for sale assets.
•
Lease liabilities of $122.5m, up
from $121.5m in FY23.
•
Borrowings of $97.7m,
consistent with FY23.
•
Assets held for sale of $25.7m.
Financials
Statement of
Financial Position
APPENDIX 5
231HY24 Investor Presentation
Financials
Statement of Cash Flows
($000)1HY241HY231HY22
Cash flows from operating activities
Receipts from residents for care fees and village fees84,07565,85662,670
Payments to suppliers and employees(76,479)(60,039)(54,899)
Proceeds from the sale of Refundable Occupation Right Agreements6,2041,3351,610
Payments for the repurchase of Refundable Occupation Right Agreements(1,789)(855)-
Interest received325032
Interest paid – borrowings(4,766)(2,286)(421)
Interest paid – lease liabilities(2,991)(3,046)(4,169)
Income tax (expense)/benefit1,313(615)(1,268)
Net cash provided by operating activities
5,599
4003,555
Cash flows from investing activities
Proceeds from the sale of property, plant and equipment889747
Payments for the purchase of property, plant and equipment(1,404)(53,032)(33,771)
Payments for village developments(458)(97)(98)
Acquisition of subsidiaries, net of cash acquired-(500)-
Net cash used in investing activities
(973)
(53,622)(33,822)
Cash flows from financing activities
Proceeds from issue of share capital--48,229
Share issue transaction costs--(2,404)
Proceeds from bank borrowings-54,020-
Repayment of bank borrowings--(8,500)
Principal payments of lease liabilities(1,340)(1,277)(1,950)
Dividends paid-(1,481)(1,128)
Net cash provided by/(used in) financing activities(1,340)51,26234,247
Reconciliation of cash and cash equivalents
Cash and cash equivalents at beginning of the year(2,379)2,0882,761
Net (decrease)/increase in cash and cash equivalents held3,288(1,960)3,980
Cash and cash equivalents at end of period
908
1286,741
APPENDIX 6
241HY24 Investor Presentation
Financials
Underlying Earnings and
AFFO Calculation
APPENDIX 7
($000)1HY241HY231HY22
Net Profit Before Tax1,6412,1881,662
Remove: Change in fair value of investment property(1,350)(175)65
Remove: Gain on acquisition of previously leased properties-(2,708)(1,403)
Include: Realised gains on resales1,350175-
Include: Realised development margins--90
Remove: Depreciation expense5,1434,9865,746
Remove: Interest Income---
Remove: Interest Expense8,0085,2824,558
Include: Pre-NZ IFRS 16 operating lease expense(4,341)(4,309)(6,118)
EBITDA10,4525,4394,600
Underlying Adjustments:
COVID-19 Adjustments-1,267331
Other Adjustments-273174
Underlying EBITDA10,4526,9795,105
Net interest expense (bank and other loans)(5,047)(2,236)(389)
Pre-NZ IFRS16 tax (expense)/benefit(521)(113)(329)
Income tax impact from adjustments-(431)(141)
Maintenance capital expenditure(2,017)(1,735)(1,944)
AFFO2,8672,4642,302
251HY24 Investor Presentation
Directory
offacilities
APPENDIX 8
OWNED
FACILITYLOCATION
CARE
BEDS
UNITS
St HelenasChristchurch52-
Thornleigh ParkNew Plymouth87-
Lexham ParkKatikati63-
HeatherleaNew Plymouth55-
Taupaki GablesKumeu60-
Windsor CourtOhaupo76-
Elloughton GardensTimaru86-
Clare House Invercargill69-
Clare House VillageInvercargill-26
Arran CourtAuckland102-
PeppertreePalmerston North62-
St JoansHamilton82-
Fulton HomeDunedin93-
Windsor Court VillageOhaupo-22
Elloughton Grange VillageTimaru-54
Matamata Country LodgeMatamata81-
Matamata Retirement Village Matamata-46
Total owned968148
Average owned7437
TOTAL
FACILITYCARE BEDSUNITS
Leased921-
Owned 968148
TOTAL
1,889148
261HY24 Investor Presentation
LEASED
FACILITYLOCATIONCARE BEDSUNITS
CURRENT LEASE
TERM
TIME TO NEXT
RENEWAL
RIGHTS OF
RENEWAL
TIME TO FINAL
EXPIRY
LANDLORD
KensingtonHamilton96-10 yrs0.6 yrs2 x 10 yrs10.6 yrsA
Potter HomeWhangarei55-20 yrs6.1 yrs2 x 15 yrs36.1 yrsB
Rimu ParkWhangarei55-20 yrs6.1 yrs2 x 15 yrs36.1 yrsB
WaipunaAuckland86-30 yrs23.3 yrs-23.3 yrsC
Hampton CourtNapier45-10 yrs5.4 yrs-5.4 yrsD
BaycareNorthland45-12 yrs2.5 yrs3 x 12 yrs38.5 yrsE
MatuaTauranga149-30 yrs19.1 yrs-19.1 yrsF
AlthorpTauranga117-15 yrs4.9 yrs3 x 10 yrs34.9 yrsG
Millstream
1
Ashburton80-35 yrs27.8 yrs-27.8 yrsH
Millstream Apartments
1
Ashburton19-5 yrs0.9 yrs2 x 5 yrs10.9 yrsH
GlaisdaleHamilton80-15 yrs8.7 yrs2 x 15 yrs38.7 yrsI
HawthorneChristchurch94-10 yrs6.6 yrs2 x 10 yrs16.6 yrsJ
Total leased921-n/an/an/an/a
Average leased77-17.7 yrs9.3 yrsn/a24.9 yrs
Directory
offacilities
APPENDIX 8
1 Millstream and Millstream Apartments are one facility but Millstream Apartments has a separate lease to the main facility
.
271HY24 Investor Presentation
87% of the
portfolio are beds
certified for high
acuity and
specialist care
with significant
flexibility of care.
This aligns with
the sector
dynamics of
‘aging in place’
reducing the need
for rest home level
care and
increasing the
need for higher
acuity care.
1 Source: CBRE analysis, October 2022
BedMix
1HY24
1HY23
1HY24
1HY23
33.0%
34.0%
42.3%
13.4%
13.5%
46.7%
44.9%
50.3%
48.8%
42.6%
23.0%
23.3%
11.6%
11.0%
13.3%
11.0%
12.3%
4.9%
5.7%
1.8%
5.1%
5.2%
0.2%
0.5%
0.8%
0.8%
Rest HomeSwingHospitalDementiaPsychogeriatric & Other Non ORAPhysical and intellectual
Industry
average
1
~
87% of Radius Care Beds are certified for high acuity
~
87% of Radius Care Beds are certified for high acuity
~58% high acuity and specialist
~66
% of Radius Care Beds are used for high acuity, vs industry of ~58%
~
67% of Radius Care Beds are used for high acuity, vs industry of ~58%
Care Bed
Type
Care Bed
Use
APPENDIX 9
281HY24 Investor Presentation
Important Notice
and Disclaimer
This presentation has been prepared by Radius Residential Care Limited (“Radius Care”), for informational purposes. This disclaimer applies to
this document and the verbal or written comments of any person presenting it.
This presentation sets out information relating to Radius Care’s half year result for the period to 30 September 2023. As such, it should be read in
conjunction with the unaudited consolidated financial statements for Radius Care and its subsidiaries for the period ended 30 September 2023
(“Financial Statements”) and other material that Radius Care has released to NZX along with this presentation. That material is also available at
www.radiuscare.co.nz.
In certain sections of this presentation, Radius Care has chosen to present certain financial information exclusive of the impact of significant
items. A number of non-GAAP financial measures are used in this presentation which are used by management to assess the performance of
the business and have been derived from the Financial Statements. You should not consider any of these financial measures in isolation from, or
as a substitute for the information provided in the Financial Statements.
This presentation may contain forward-looking statements and projections. Such forward-looking statements are based on current expectations,
estimates and assumptions and are subject to a number of risks and uncertainties, including material adverse events, significant one-off
expenses and other unforeseeable circumstances. There is no assurance that results contemplated in any of these projections and forward-
looking statements will be realised. Actual results may differ materially from those projected. Except as required by law, or the NZX Listing Rules,
no person is under any obligation to update this presentation at any time after its release or to provide further information about Radius Care.
The information in this presentation has been prepared in good faith by Radius Care. Neither Radius Care nor any of its directors, employees,
shareholders nor any other person give any representations or warranties (either express or implied) as to the accuracy or completeness of the
information in this presentation and to the maximum extent permitted by law, no such person shall have any liability whatsoever to any person
for any loss (including, without limitation, arising from any fault or negligence) arising from this presentation or any information supplied in
connection with it.
This presentation is not a product disclosure statement or other disclosure document, or an offer of shares for subscription, or sale, in any
jurisdiction. The information in this presentation does not constitute financial product, legal, financial, investment, tax or any other advice or a
recommendation.
This presentation has been prepared by Radius Residential Care Limited (“Radius Care”), for informational purposes. This disclaimer applies to
this document and the verbal or written comments of any person presenting it.
This presentation sets out information relating to Radius Care’s half year result for the period to 30 September 2023. As such, it should be read in
conjunction with the unaudited consolidated financial statements for Radius Care and its subsidiaries for the period ended 30 September 2023
(“Financial Statements”) and other material that Radius Care has released to NZX along with this presentation. That material is also available at
www.radiuscare.co.nz.
In certain sections of this presentation, Radius Care has chosen to present certain financial information exclusive of the impact of significant
items. A number of non-GAAP financial measures are used in this presentation which are used by management to assess the performance of
the business and have been derived from the Financial Statements. You should not consider any of these financial measures in isolation from, or
as a substitute for the information provided in the Financial Statements.
This presentation may contain forward-looking statements and projections. Such forward-looking statements are based on current expectations,
estimates and assumptions and are subject to a number of risks and uncertainties, including material adverse events, significant one-off
expenses and other unforeseeable circumstances. There is no assurance that results contemplated in any of these projections and forward-
looking statements will be realised. Actual results may differ materially from those projected. Except as required by law, or the NZX Listing Rules,
no person is under any obligation to update this presentation at any time after its release or to provide further information about Radius Care.
The information in this presentation has been prepared in good faith by Radius Care. Neither Radius Care nor any of its directors, employees,
shareholders nor any other person give any representations or warranties (either express or implied) as to the accuracy or completeness of the
information in this presentation and to the maximum extent permitted by law, no such person shall have any liability whatsoever to any person
for any loss (including, without limitation, arising from any fault or negligence) arising from this presentation or any information supplied in
connection with it.
This presentation is not a product disclosure statement or other disclosure document, or an offer of shares for subscription, or sale, in any
jurisdiction. The information in this presentation does not constitute financial product, legal, financial, investment, tax or any other advice or a
recommendation.
291HY24 Investor Presentation
Thank You
---
Radius Residential Care Limited
Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)
Updated as at June 2023
Results for announcement to the market
Name of issuer Radius Residential Care Limited
Reporting Period 6 months to 30 September 2023
Previous Reporting Period 6 months to 30 September 2022
Currency NZD
Amount (000s) Percentage change
Revenue from continuing
operations
$84,470 20.9%
Total Revenue $85,853 17.7%
Net profit/(loss) from
continuing operations
$1,418 (17.7%)
Total net profit/(loss) $1,418 (17.7%)
Interim Dividend
Amount per Quoted Equity
Security
Not Applicable
Imputed amount per Quoted
Equity Security
Not Applicable
Record Date Not Applicable
Dividend Payment Date Not Applicable
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
$0.18 $0.18
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
Authority for this announcement
Name of person
authorised
to make this announcement
Jeremy Edmonds
Contact person for this
announcement
Jeremy Edmonds
Contact phone number 022 650 9354
Contact email address Jeremy.edmonds@radiuscare.co.nz
Date of release through MAP
27 November 2023
Unaudited financial statements accompany this announcement.
Data sourced from publicly available filings. Our datasets may not be complete. Automated analysis can produce errors. If you believe any data on this page is incorrect, please contact us at hello@nzxplorer.co.nz. For informational purposes only. Not investment advice.
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