Regis boosts its FY17 profits on back of increased revenue from beds and RADs

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Their FY17 results reveal the operator’s revenue per occupied bed day has moved to $281 compared to $272 in FY16, with 48% of new residents opting to pay a Refundable Accommodation Deposit (RAD) over a Daily Accommodation payment (DAP) or a combination RAD/DAP payment.

This gave the listed provider an average incoming RAD of $455.6K compared with $389.3K for FY16 – the equivalent of 154 people.

Overall, Regis reported an EBITDA of $123.6M – a jump of 18% – and NPAT of $61.1M from revenue of $565.5M – an increase of 8%.

This includes earnings from the 771 beds it acquired through its purchase of Masonic Care QLD’s facilities in June 2016, which it says reached target run rates during the first half of the FY.

Regis also revealed that it continues to charge an Asset Replacement Charge (ARC) to some residents while it waits for a resolution on its April application to the Federal Court to charge the fee which we covered here.

Regis is investing another $151M in expanding its portfolio with 1,303 places in the pipeline and seven developments currently under construction.

The provider also plans to expand its retirement village business with 350 RV units planned for their Burwood East site in Melbourne in nine stages over 10 years. They currently have 550 units co-located with five of their aged care facilities.

In total, their average occupancy is now 94.9% with their number of places set to grow to 6,316 following the development of their Kingswood facility in SA and the acquisition of three Presbyterian Care facilities with 287 beds in TAS.

Regis did report its new RAD cash flow of $70.5M was ‘below expectations’, which it attributes to a small number of facilities receiving higher than projected numbers of non-RAD paying residents in the second half of the FY – that’s around 235 RADs at $300K each.

However it was still significantly higher than the $44.9M results for FY16 and Regis says it expects the number of RAD-paying residents to return to expected levels over time – making it a solid result all-round.