Eureka Group growing with aged care demand

Interviews

Transcription of Finance News Network Interview with Eureka Group Holdings Limited (ASX:EGH) Chairman, Robin Levison
 
 
Lelde Smits:Eureka Group Holdings Limited (ASX:EGH) manages and owns properties facilitating independent living communities for seniors across Australia. Eureka is the property asset manager of 21 villages nationally including more than 1,291 units, with 374 company-owned. The company also provides basic lifestyle care and monitors the health and wellbeing of its residents.
 
I’m Lelde Smits and joining me at ASX Investor Series in Sydney is the company’s Chairman, Robin Levison. Robin welcome.
 
Robin Levison: Thank you.
 
Lelde Smits:Could you please outline the footprint of the company across Australia and also recent acquisitions?
 
Robin Levison: We’re the second largest operator of rental retirement villages in Australia. We have villages in New South Wales, Southern Australia and Queensland. And we’ve spent, in the last 12 months, approximately $25 million on new acquisitions.
 
Lelde Smits: Could you explain how Eureka bridges the gap between independent living and aged care, and why this matters?
 
Robin Levison: We actually don’t bridge that gap. We don’t offer aged care; we are purely low care no care retirement village operators. Hence if you need medical care or significant aged care, you would not come to us. However, the no care low care market, which is populated by residents who are pensioners, or they get rent assistance or they might have some sort of disability benefit, they are the bulk of our residents. And we offer an affordable solution for them, given that they are relying upon Government funding.
 
Lelde Smits: The company says it offers a silver lining for its silver haired citizens. Could you explain what’s unique about your offering?
 
Robin Levison: Again, we are rental only. So from a resident’s point of view, you don’t need to put an enormous amount of capital, or any capital in fact, into the purchase of a unit when you live with us. We also give you three square meals a day. So all of our residents will come to the central dining facility, where we will feed them in an appropriate manner. And then a number of times a week, they will also have some sort of social activity in the village itself.
 
There is also a full time manager onsite and in the rooms, there’s a panic button in case anything untoward might happen. So overall, what we’re doing is providing a service for our residents, where in the main part, I think they’re happy. We’re greater than 90 per cent full across all of our villages, which to me indicates that we’re giving good value for money.
 
Lelde Smits: Could you give investors a brief overview of your financials?
 
Robin Levison: On a 12 month forward basis with all of the current villages that we own and/or manage, we expect to make around $5.5 million EBITDA (earnings before interest, taxes, depreciation and amortization) for the year.
 
Lelde Smits: What facts support the strong growth projections that Eureka has for your industry?
 
Robin Levison: So this is a very fragmented industry and what we see is that we’ll benefit from a company that can aggregate and bring scale to the industry. Secondly, the Australian Bureau of Statistics estimates that from now, where there are 3.2 million retirees over 65, by 2030 there will be 5.8 million retirees. And the bulk of those retirees will be reliant on Government pension, rent assistance, or disability benefit. So again, we think the product we bring to market is ideal for those folks.
 
Lelde Smits: What is Eureka’s strategy for the year ahead?
 
Robin Levison: We see this market as a market that will benefit from consolidationfrom larger operators, who are able to operate at a lower cost. We continue to see ourselves growing strongly and I would anticipate over the next 12 months, that we will acquire a number of other villages that we don’t already own. And really it’ll be more of the same, offering that same service and support to our customers.
 
Lelde Smits: Robin Levison, thank you for the update from Eureka Group Holdings.
 
Robin Levison: Pleasure.
 
 
Ends
 
 

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