Care UK positive despite lost contract

Source: Healthcare Exec

Date :19/11/2007 10:49:23

Care UK, the care homes group, saw underlying profits rise 28 percent on last year despite the loss of a diagnostics contract with the Department of Health.

The company stated that it had been assured by the Health Department that the decision to end the West Midlands diagnostic contract was for very specific and localised reasons and does not signal a wider with the company’s strategy.

Plummet

Care UK has seen its share price fall by over 60 percent since May, but today reported adjusted profits climbing from £15.7 million to £20.1 million on revenues of £276 million, up from £199 million. Pre-tax profits were consistent at £14.5m against £14.2m.

John Nash, Chairman of Care UK, said of the results:

“Care UK has established a firm business foundation with excellent visibility of future earnings through long-term contracts, a high level of income guarantees and the inherent continuity of essential services. The group’s financial strength is further underpinned by strong cash flows and the value of its property assets.

We believe that Care UK continues to be well placed within its chosen markets and the scale, quantity and range of opportunities for both organic and acquisitive growth are compelling. The board is, therefore, confident that Care UK will maintain its strong performance during the coming years.”

November 19, 2007