CareTech Holdings profits fall by nearly a fifth as costs offset jump in revenues

Writer, Stock Market Wire
Thursday, June 20, 2019 - 08:09

Social care provider CareTech Holdings said profits slipped by nearly a fifth as the acquisition of Cambian ramped up costs offsetting a jump in revenues.

For the six months ended 31 March, statutory pre-tax profits fell 19% to £6.9m, while revenue increased 120% to £192.5m, with CareTech contributing £98.3m and Cambian £94.2m.

The results comes after the company completed the acquisition of Cambian Group in October 2018 for £278.5m.

Excluding the impact of non-underlying items, which include acquisition costs related to Cambian, underlying profit before tax rose 50% to £20.7m.

Earnings (EBITDA) rose 71% to £33.3m.

Looking forward, the company said it would continue with the integration plan and deliver the synergies from its acquisition of Cambian.

The company touted further acquisitions in the pipeline, saying it was 'well placed to take advantage of opportunities for further consolidation in the sector and for organic growth.'

'Like for like, the performance of the CareTech business in the half year was stronger when compared with the same period last year. The EBITDA margins of the CareTech business are in line with market expectations and the EBITDA margins of the Cambian business, before synergies, show considerable improvement when compared with their historic announced margins,' said Farouq Sheikh, Executive Chairman of CareTech.

'The integration plan for the combined business is well underway following the unconditional clearance issued by the CMA in February 2019. The Group confirms that synergies of at least £3m of cost savings, in the first full year since acquisition, are on track to being delivered.'

At 8:09am: (LON:CTH) CareTech Holdings PLC share price was +1.5p at 374.5p

Related content

CareTech gets regulatory nod to acquire Cambian

CareTech confirmed Friday the Competition and Markets Authority had unconditionally cleared the company's acquisition of Cambian.

The transaction was completed on 19 October 2018....

Fri, 08/02/2019 - 10:00

Which companies are potential takeover targets in the healthcare sector?

Corporate activity in the healthcare sector is heating up. GlaxoSmithKline (GSK) and US rival Pfizer plan to marry their consumer health businesses in a...

Thu, 07/02/2019 - 00:00

CareTech raises £32.6m from sale and lease back of properties

Social care services provider CareTech Holdings said it had raised £32.6m to support its growth through a rent agreement with funds managed by Alpha Real...

Tue, 29/01/2019 - 14:31

CareTech meets full-year expectations amid modest boost in capacity

CareTech Holdings said Friday that full-year performance was in line with market expectations after capacity in residential and supported living increased modestly, though occupancy levels...

Fri, 26/10/2018 - 08:57

Broker Forecast - Liberum Capital issues a broker note on CareTech Holdings PLC

Liberum Capital today initiates coverage of CareTech Holdings PLC (LON:CTH) with a buy investment rating and price target of 525p.

Broker Forecasts data provided by...

Mon, 17/09/2018 - 08:20