PRESENTATION OF FY2018 RESULTS Arvida Group Limited Year Ended 31 March 2018 28 May 2018
FY1 Y18 R 8 RESULT H HIG IGHLIG IGHTS Financial Accretive Development Performance Acquisitions Activity Reported NPAT at $58m; Three quality villages 97 new units delivered; 43% increase in Underlying integrated into Group; expanded development Profit 1 to $33m immediately earnings programme and development accretive and performing well team Financial Strong Care Positive Position Demand Outlook Assets now over $1.1b with Care facility occupancy Exceptional NPS result; conservative capital structure; remains very high at 96% well increased dividend declared $77m rights issue successfully above industry average; plus special dividend completed to fund 70% of total revenue acquisitions underpinned by care fees 1. Underlying Profit is a non-GAAP (unaudited) financial measure and differs from NZ IFRS net profit after tax. A reconciliation to Reported Net Profit after Tax is provided on page 19 and definition on page 28. FY18 RESULTS PRESENTATION 2
STRO RONG NG T TREND RENDS C CONT NTINUE NUE Underlying Profit 1 ($m) Reported NPAT (IFRS) ($m) 33.0 57.6 53.7 23.1 15.8 24.0 FY16 FY17 FY18 FY16 FY17 FY18 Operating Cash Flow ($m) Total Assets ($m) 1,133 53.9 39.7 795 24.1 461 FY16 FY17 FY18 FY16 FY17 FY18 1. Underlying Profit is a non-GAAP (unaudited) financial measure and differs from NZ IFRS net profit after tax. A reconciliation to Reported Net Profit after Tax is provided on page 19 and definition on page 28. FY18 RESULTS PRESENTATION 3
BUSINESS OVERVIEW 4
OUR S UR STATED ED S STRA RATEG EGY Strategy Update 3 1 2 1. Attitude of Living Well model emphasises resident autonomy, engagement and relationship-centred care. Comprises five wellness pillars 1 – eating, thinking, resting, moving and engaging well – that encourage holistic practice and excellence in clinical care in an environment that supports living well 2 2. Resident survey of both retirement village and care facilities measures our performance annually 3. Incorporates the community aspects of the Attitude of Living Well model where we help the resident regain connection to the wider 3 community: − Continue to develop product that integrates with the community, allowing better connections and relationships − Better positions the business for the next wave of customers; the Baby Boomers FY18 RESULTS PRESENTATION 5
SNAP NAPSHOT O OF F AR ARVIDA Village Locations Overview Village Locations Listed on NZX in December 2014 Balance sheet growth of 250% since listing Nearly 4,000 residents across 29 villages High needs-based portfolio 1,850 retirement units; including villas, apartments, serviced apartments and care suites 1,743 care beds; including rest home, dementia and hospital-level care Brownfield development in progress at 8 villages, earthworks underway at first greenfield development Development pipeline of 1,000+ units at 31 March 2018 Gross Returns (since IPO) 600 48 500 119 400 46 300 154 534 Existing Village 415 200 215 Existing Village with Development Activity 100 ZDm NZD - Future Village (greenfield site) IPO Capital raised Vendor scrip Total capital Capital growth Current market Dividend return from investors consideration invested capitalisation FY18 RESULTS PRESENTATION 6
POR ORTF TFOLI OLIO O COM OMPOSITI TION ON AT 3 T 31 MARCH 2 2018 Portfolio Composition 1 Aged Care Composition FY17 DEV ACQ ADJ FY18 Rest Home 714 - 49 -20 743 Dementia 150 - 117 - 267 37% Hospital 582 - 140 +11 733 42% 43% Total Aged Care 1,446 - 306 -9 1,743 63% Serviced Apts/Suites 588 4 97 -1 688 Villas/Apts 713 97 354 -2 1,162 15% Total Retirement 1,301 101 451 -3 1,850 Units Total Units/Beds 2,747 101 757 -12 3,593 Serviced Apts Villas/Apts Rest Home Dementia Hospital Development 907 1,099 Commentary Needs-based Composition 4,692 units/beds 4 care suite conversions at Mary Doyle and Village at the Park since acquired 3,593 units/beds 38% 97 new units developed over the period 32% Other adjustments in accommodation mix reflect a combination of swing beds and decommissioning for 62% 68% development Current Composition Post-development Composition Needs-based ILUs 1. Figures include 100% of Village at the Park. The Group has a 50% interest in Village at the Park. FY18 RESULTS PRESENTATION 7
EX EXCEL ELLENC ENCE E IN C N CARE ARE NUMBER OF CARE BEDS Care facility occupancy in March 2018 higher at 96% with average for last 12 months at 95% across our 26 care facilities (1,743 beds) FY18 1,743 Continued excellent Ministry of Health audit results with 12 facilities now achieving the gold standard of 4 years certification: FY17 1,446 − 83% of certification audits completed this year achieved extended 4 year period CARE FACILITY OCCUPANCY − 13 facilities have 3 years certification and only one facility has 2 year certification (to be audited later this year) 96% FY18 − Clinical standard is substantially above national level, where nationally 21% of aged care facilities^ hold 4 year certification relative to 46% of Arvida’s facilities FY17 95% Exceptional resident survey exceeding last year’s inaugural result on higher participation: CARE BED NET PROMOTER SCORE − Net Promoter Score of +53 in villages and +51 in care facilities, much higher than +51 FY18 industry context FY17 +42 -100 -50 0 50 100 ^ HDANZ Aug 2017, designated audit agency for approximately 55% NZ aged care. FY18 RESULTS PRESENTATION 8
OPE PERATIO IONAL H HIG IGHLIG IGHTS Continue to invest in our people providing training and development opportunities: − Introduced aged care specific educational videos – a first for aged care in NZ with over 10,000 courses completed − Launched leadership programme for care teams across the Group to support the Attitude of Living Well Developing additional services that reflect The Attitude of Living Well to support village residents to receive in-home care as part of the Living Well model SafePlus audit of seven villages found high level of Health & Safety practices in place: − Achieved ACC Workplace Safety Management Practices level 3 across Group − National Health & Safety Manager recently appointed Rollout of resident management system across group progressing well – now in 23 villages Integration of Strathallan and Mary Doyle completed – JV at Village at the Park operating well Nutrition and healthy food options focus across Group by National Dietitian: − Providing opportunities for resident engagement with foodservice and dining experiences that promote companionship − Food control plan templated across Group and independently verified by external audit FY18 RESULTS PRESENTATION 9
DEVELOPMENT Artist impression of Richmond, Nelson 10
DEVE VELOPM PMENT A ACTIVIT IVITY FY18 New Unit Delivery Villas Apts S. Apts Total Commentary In November 2017, guidance for FY18 was provided Copper Crest 13 - - 13 that Arvida expected to: Mary Doyle 5 - - 5 − Deliver a total of 95 new units Lauriston Park 22 - - 22 − Settle 73 new sales (with 70 over 2H18) For FY18, Arvida: Lansdowne Park 5 - - 5 − Delivered 97 new units across 6 villages Village at the Park - 28 - 28 − Settled sales of 79 new units during the year, Oakwoods 24 - - 24 which included 73 of the new units delivered in FY18 Total 69 28 - 97 Despite the delivery of new units being in the second half of the year, the sales team achieved a significant proportion of presales to enable the settlement of 73 of the 97 new units developed Sales Analysis FY18 FY17 YoY change FY16 within the year Gross sale proceeds for the year were $41.7m, with New Sales average value per new sale up 20% to $528k 73 16 356% 10 Villas Total development gains for the year were $6.5m, up from $2.4m in FY17. This included $1.9m of 2 16 (88%) 10 Serviced apartments gains on 31 new sales at the villages acquired 4 - nm - Care suites during the year Development margin improved to 19%, up from 79 32 146% 20 Total new units sold 17% in FY17 41.7 14.0 197% 9.3 Value $m Note: The sales analysis includes sales from Village 527.8 438.7 20% 465.0 the Park, which is 50% owned by Arvida. The Av. value per new sale $000 “Value $m” line includes 100% of the value and the 6.5 2.4 180% 1.5 Development gain $m “Development gain $m” line includes 50% of gains 19% 17% 200bp 16% Development margin % FY18 RESULTS PRESENTATION 11
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