A Very Well Managed Company, Despite a Few Changes at Board Level

Ryman Healthcare is a well-known provider of retirement-care facilities in New Zealand whose reputation and continuum of services are highly valued by customers. We believe the firm enjoys a narrow moat because of its low costs and brand strength, which drive residents to Ryman's villages. The company prices units competitively and the firm's occupancy fees are capped at 20%, which is materially below that of rivals. In the process, Ryman Healthcare retains a lucrative development margin, generally varying between 20%-25% of new sales. Additionally, Ryman Healthcare generates good cash flow by operating its villages at a high utilisation rate, which is reinvested back into the business to grow the portfolio.