oceania healthcare (ASX:OCA)The company, New Zealand’s leading provider of aged care and retirement living services, operating 46 locations across New Zealand, has announced its financial results for the six months to 30 September 2024.

The company reported a net loss of $17.1 million, compared to a profit of $35.2 million in the year-ago period. A significant portion of the loss was due to impairment of property, plant and equipment related to the Elmwood Care site in Auckland. This impairment resulted from the partial closure of the building and the relocation of residents to newly completed care suites.

Underlying EBITDA, excluding one-time items and unrealized fair value adjustments, increased 2.7% to $38.6 million due to higher sales volumes and a 34.9% increase in capital gains of $38.2 million. Revenue from continuing operations increased 0.8% to $132.6 million, and operating cash flow increased 23.1% to $70.4 million. Basic earnings per share decreased to -2.4 cents, reflecting the company’s loss for the period.

The company continued its strategy to modernize its portfolio, delivering 106 new care suites at its Elmwood site in Oakland and selling four non-core sites for $25.1 million. Total assets increased to $2.82 billion and unsold inventory decreased 13.5% to $305 million. The debt index improved slightly to 37.5%, reflecting Oceania’s focus on deleveraging. Resales of independent living units and care suites continued to be strong, with 169 units sold and new care suite sales exceeding expectations with 51 units.

CEO Suzanne Dvorak, who joined the company in July 2024, emphasized the need to increase sales, improve the profitability of nursing care services, and streamline development plans. The appointment of a chief sales and marketing officer underscores Oceania’s focus on addressing unsold inventory and growing revenue. The board suspended the dividend, citing the need to reduce gearing and improve financial flexibility before resuming payments.

Shares closed 9.68% lower at 70 cents on Friday.