asset sales - sneaky and good, page-4

The profits are to come from retirement. FKP basically expects to double its return on assets from this division in the next 3 years from a combination of driving down costs and increasing the development pipeline. Considering if is currently only earning 4% that looks pretty achievable.

The goal with non-retirement isn't so much to make profits but realise at book value. The company has approx $800m of assets in this division and if all sold at book then would have the whole retirement division, no debt and net cash of more than $100m.

Of course they won't just sit on the cash - they will look to redeploy to retirement to increase returns on this division with the extra capital.

Most other local and NZ retirement assets trade at or above NTA so as long as we can get returns on this division to an acceptable level once it is a sole play then there is plenty of upside.