Southport-based Eureka Group on Gold Coast receives approval for strata-titling of Terranora village following first-half profit

Gold Coast-based  retirement community operator Eureka Group has received final approvals to strata-title its new village, more than two years after plans were first lodged.

GOLD  Coast-based  retirement village operator Eureka Group has received final approvals from Tweed Council to strata-title its Terranora village, more than two years after plans were first lodged.

The move means the Southport-based microcap can move forward with sales of the 61 units and effect settlement for the properties that have sold.

Eureka executive chairman Murray Boyte said the project can now be bought to fruition after “a period of frustrating delays”.

“This is an important milestone for Eureka that will facilitate the release of funds to expand the core business and strengthen the balance sheet,” he said.

Eureka Group chairman Murray Boyte. Photo: Supplied

Shares increased by close to eight per cent in the wake of the announcement to close 2¢ higher at 27.5¢.

Eureka‘s first-half result, released last week, showed a vast improvement for the company.

Net profit soared to $2.83 million from a loss of $100,000 in the previous period.

Revenue increased by five per at $11.8 million, due to stronger occupancy levels at its retirement villages and additional service fees from a five-village joint venture in Tasmania.

Debt was cut from $55 million to $50 million after using cash received from the sale of Eureka’s units at Couran Cove and a loan repayment from Onterran Ltd, which is linked to Eureka director Lachlan McIntosh.

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Eureka is also owed $330,000 by Mr McIntosh, due on December 31 this year and a further loan of $320,000, called the West Cabin Loan, guaranteed by Onterran and Mr McIntosh, is due to be paid by mid-April.

The company said despite strong trading results it will miss forecast pretax earnings guidance of between $7.8 million and $8.3 million for the full year due to one-off costs.

However, it said it will focus on further expanding its core business of providing affordable rental accommodation for retirees through the acquisition of new villages and units during the second half.

It also said it is focusing on implementing efficiencies and cost reductions through streamlined services across its villages and support office.