A Summerset retirement village in Flatbush. Photo: Google
Aged care provider and retirement village operator Summerset is considering no longer accepting referrals from the public health system, blaming government underfunding.
It comes as the company lifted its underlying profit despite a tough period for the property market, although its bottom line slipped on weaker property values.
Key numbers for the 12 months ended December compared with a year ago:
- net profit $339.8m vs $425.3m
- revenue $319.9m vs $272.2m
- underlying profit $206.4m vs $190.3m
- final dividend unchanged at 13.2 cents per share.
Chief executive Scott Scoullar said the company's proposal was driven by resources.
"While we've created greater financial certainty for ourselves, and our residents, by moving to care ORAs (occupation right agreements) at many of our villages there is still a major gap between our aged care funding and the costs of running our care centres.
"We are currently reviewing our policies and where this funding gap is leaving us. We will have to consider making our care centres available to our village residents only and no longer accepting referrals from the public health system."
Scoullar said "it's not a step we want to take", but Summerset had to focus resources on village residents.
"We don't want to end up overstretching our staff. We know this will mean a bigger burden will be placed on the public health system, but we can't keep taking the strain."
The announcement came with Summerset's full-year financial results, which saw an 8 percent increase in underlying profit.
Its sales of occupation rights rose 12 percent from a year ago, despite a slight fall in margins.
"We continue to see the benefits of our regionally diverse portfolio, with eight regions seeing over 30 sales settlements across 2024, highlighting the broad appeal and strength of our villages nationwide," Scoullar said.
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