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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