Oceania Healthcare (ASX:OCA) Reports FY25 Market Update and Refinancing
Sales Momentum
Oceania Healthcare reported a 29% increase in new sales volumes and a 6% rise in resales in 3Q25 compared to 3Q24. The Helier in Auckland is now 34% occupied, supported by new developments at Waterford and Awatere. The company holds $361m in unsold stock, which is pivotal for debt reduction. Recent appointments include a Chief Sales and Marketing Officer and a General Manager Sales.
Refinancing and Banking Support
The company successfully refinanced its $500m debt facility on 4 March 2025, effective from 1 May 2025. The refinancing included optimal pricing, extended tenor, and the addition of BNZ to the syndicate. Oceania maintains an Interest Cover Ratio of 4.2x against a covenant of 2.0x, ensuring sufficient headroom for current and future developments without requiring additional capital.
Business Optimisation
Oceania completed a $5m right-sizing program in HY25, with long-term savings projected between $10-15m annually from FY26. The company has also decided to close the Wesley Institute of Nursing Education, with the final intake in March 2025. This training school contributed $6.8m to EBITDA in FY24 and approximately $5.1m in FY25.
Developments and Portfolio Transition
The Meadowbank dementia building and Franklin development are under construction, expected to complete in May 2025 and January 2026 respectively. The portfolio is transitioning towards a more than 50% retirement mix, currently at 54% care and 46% ILU. Seven strategic divestments have been completed, generating $45m, with more expected in HY26 to support debt reduction and portfolio balance.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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