Arvida Group Limited — Interim / Quarterly Report 2017

Mar 21, 2017

Issue 4, March 2017.

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As we approach the end of the 2017 financial year, we can look back upon a period that has included numerous milestones.

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----- Start of picture text ----- A few of Arvida’s achievements so far this year:• Acquisition of Lansdowne Park • ACC tertiary accreditationin Masterton, Lauriston Park in across the GroupCambridge, Copper Crest and • Arvida included in the NZ50Bethlehem Views in Tauranga Index in Decemberand Cascades in Hamilton• Clinical policies and procedures• Six villages have attained a very now consistent and locked inimpressive 4 year certification across the Group via our Arvidaaudit result Intranet• Developments at Park Lane, • All Group and Village marketingAria Bay, Rhodes on Cashmere, collateral has been updatedOakwoods, St Albans – resource with consistent brand,consented and/or construction accommodation and careunderway messaging• Our refurbishment standards • Rollout of standardisedand processes have been employment contracts acrossreviewed and updated the Group----- End of picture text -----

Bill McDonald Chief Executive Officer Arvida Group

meaningful brownfield development opportunity to build additional care beds or serviced apartments in the future. Occupancy at the care facility has historically been very high. The acquisition of Cascades was funded from existing debt facilities and is immediately accretive to earnings. With the addition of Cascades, we now have a strong base in one of the key growth areas in NZ. The recent acquisitions are all at the epicentre of a geographic, demographic ‘Golden Triangle’ for aged care – which encompasses the Auckland, Waikato and Bay of Plenty regions.

We received news, in the week before Christmas, of our inclusion in the NZX 50 Index (NZ50). This was a terrific milestone to reach just two years after completion of our IPO. The index comprises the 50 biggest stocks by free-float market capitalisation trading on the NZ stock exchange. Index inclusion has led to improved share liquidity as a result of broader exposure to the investment community. We also started off the New Year completing the acquisition of Cascades having satisfied all conditions of purchase. This superb facility, centrally located in Hamilton, includes a

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----- Start of picture text ----- Arvida. The attitude of living well.----- End of picture text -----

view of residents’ wellbeing. This means we will continue to develop an integrated care model to best satisfy the needs of our residents.

to grow – both organically and through development and acquisition opportunities. While we see a number of opportunities to acquire retirement villages, we remain selective in the opportunities we pursue. By executing a disciplined approach, our strategy has delivered strong appreciation in underlying profit per share. Underlying profit is a key measure of our financial performance.

Arvida’s growth isn’t only occurring through acquisition. Where else is it coming from?

Looking to the end of the financial year, how is Arvida positioned?

Development activity is in progress across multiple sites nationally. We have a pipeline of over 550 units/beds to be developed, representing a 20% increase in our current portfolio. 225 units/beds are currently under construction. The first residents are expected to commence moving in to these developments in mid-FY2018. We are ambitious in our plans

We are happy with how the integration of Cascades has progressed since completion on 30 December 2016. Taking ownership over the holiday period helped to achieve an accelerated integration programme. The integration of the four other villages acquired this financial year have progressed according to plan and have now completed. Our FY2017 result will include partial contributions from each of these 5 villages.

What is the core focus for Arvida?

The core of our focus remains on resident outcomes and ensuring the successful culture embedded in each of our villages endures.

Underlying Profit Per Share

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----- Start of picture text ----- 4 cents 2.93c 3.11c 3.46c3 cents2 cents1 cents01H16 2H16 1H17----- End of picture text -----

Six villages have now attained very impressive 4 year certification audit results. We see this as a product of the investment made in our staff, systems and culture across the Group.

We have continued to see strong sales and pricing momentum in our retirement villages during FY2017. Our care facilities continue to operate at high levels of occupancy that is above the national experience.

Our approach takes a holistic

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Jonathan Ash General Manager Development

Update

The development team has been busy over the last few months:

• Site works for construction of 22 new Villas at Oakwoods is near complete. Villa construction will commence this month for completion later in 2017.

• At Aria Bay, construction is progressing well on the 24 new ‘high value’ Apartments.

• Bare land adjacent to Lauriston Park has been acquired. Together with the existing bare land, 24 new Villas are to be built. Construction commences later this month with anticipated completion later in 2017.

• Enabling works are complete for the 31 Apartments and 40 Care Suites at Rhodes on Cashmere. Fletcher Building is due to commence construction of the first stage Apartments during March.

• The first of 15 Villas are under construction at Copper Crest. Site-works are underway for 25 more Villas and master planning for the 70+ Apartment and care suite facility is progressing.

  • Construction of the first stage of 78 Apartments at Park Lane is well underway and is due for completion late 2017.

  • EQ remediation at St Albans is now complete. Consent has been granted for 20 new Apartments and a new hospital/care wing. Construction start is planned for later this year.

• Master planning for the development of 40+ new Apartments at Cascades has commenced.

We have a development pipeline of more than 250 new units or beds for delivery over the next two to three years.

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on the menu

Good nutrition is challenging to maintain as ageing progresses with changes in metabolism and absorption rates, nutrient requirements and the ability to choose, prepare and consume foods. There is huge potential to positively impact the lives and health of our residents through good food management.

as well as implementing Food Control Plans within our kitchen teams. Some great recipes already reside in our

Julia Scott is integral to working with our villages designing and implementing menu plans. Julia is a registered dietitian and passionate about holistic health. She has a strong food service background working mainly within the DHB’s and has assisted Age Concern with their Eat Well-Live Well programme. Her focus at Arvida is improving the ‘eating well’ component of the Arvida Wellness Programme

villages. Julia is taking these, sharing the favourites amongst the Group and including new ideas. This investment will lead to nutritious menus across our villages with a view to improving resident wellbeing. Wellness is at the heart of our vision.

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joins the Arvida Group

Rest Home and Hospital suites are of a larger size with each having their own private ensuites.

Cascades is located close to the Hamilton CBD with elevated views overlooking Hamilton Lake and the Kaimai Ranges to the east. It comprises an integrated facility with 37 retirement units and 74 care beds as well as bare land for future development of over 40 units.

Residents of the independent living apartments and serviced apartments can also obtain a level of care in their home commensurate with their needs.

Cascades offers up to Hospital level care for those who require full time professional care.

Cascades is the sister facility to Bethlehem Views, acquired from the Sanderson Group.

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----- Start of picture text ----- Arvida is one ofthe larger operatorsof retirement villagesand aged care facilitiesin New Zealand.Arvida’s villages arelocated nationally, withover 2,800 residentsspread across 26locations. Every villageoperates independentlyand expresses its owncharacter, personalityand identity.The corporate structureprovides the backgroundsupport to ensure qualityand consistency acrossGroup operations, whichultimately benefitsresidents, village staffand shareholders.----- End of picture text -----

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OUR VISION

Improving the lives and wellbeing of our residents by transforming the ageing experience

OUR MISSION

To challenge ourselves to make our residents’ lives better with everything we do

OUR PROMISE

Feel younger for longer and actively engaged in life

Investor Centre

We look to publish an investor update twice yearly. Your feedback and suggestions are greatly welcomed. See contact details below.

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----- Start of picture text ----- Investor Calendar*Release of Annual Result:24th May, 2017Final Dividend Payment (4Q FY17):16th June, 2017Annual Shareholder Meeting:7th July, 2017 (Christchurch)* Expected dates, subject to confirmation.----- End of picture text -----

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----- Start of picture text ----- Relative Shareholder Returns----- End of picture text -----

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----- Start of picture text ----- 18016014012010080Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17Arvida Group NZ50GSource: IRESS as at March 2017.Total Shareholder Return----- End of picture text -----

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Contact Us

You can contact us at any of the addresses and numbers below with enquiries, feedback or suggestions:

Arvida Group Limited Level 1, 39 Market Place PO Box 90217 Victoria Street West AUCKLAND 1142

Phone: +64 9 972 1180 Email: info@arvida.co.nz www.arvida.co.nz

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----- Start of picture text ----- Arvida. The attitude of living well.----- End of picture text -----