Half-yearly results for the six months ended 31 March 2008 | Care UK

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Half-yearly results for the six months ended 31 March 2008

May 19th 2008

Highlights
Six months ended 31 March

Amounts in £m unless stated

2008

2007

% change

Revenue: group and share of joint venture

166.7

118.0

+41

Adjusted operating profit 1

15.9

11.6

+37

Operating (loss)/profit

(3.8)

10.0

-

Adjusted profit before taxation 1

8.7

7.1

+23

(Loss)/profit before taxation

(9.6)

6.8

-

Adjusted basic EPS 1

10.99p

9.80p

+12

Basic EPS

(19.23p)

9.16p

-

Interim dividend proposed 2

1.33p

1.22p

+9

 

1Adjusted operating profit, adjusted profit before taxation and adjusted basic EPS are stated before amortisation of intangible assets of £2.4m (£0.3m) and impairment of goodwill and intangible assets of £15.9m (2007: £nil). Adjusted operating profit is stated before joint venture net financing charges and taxation of £1.4m (2007: £1.3m). Adjusted profit before taxation is stated before joint venture taxation of £0.7m (2007: £0.4m). The adjusting items are explained more fully in the Operations & Finance Review.
2 In accordance with IAS 10, the proposed interim dividend was not included as a liability at either 31 March 2008 or 31 March 2007.

Another period of good progress for Care UK with continued growth in all four divisions.

  • Future growth underpinned by strong forward contracted revenue of £1.1bn (2007: £0.9bn) excluding revenue at preferred bidder stage
  • Current funding headroom of over £80m, sufficient to fund all current development plans

 

Social Care:

  • Residential Care organic revenue and operating profit growth of 8%
  • New home successfully commissioned in Kensington & Chelsea
  • Strong growth in Community Care - revenue up 30%, operating profit up 28%
  • Community Care acquisition in South Gloucestershire and significant new contract award in Hertfordshire
  • Improved margin in Specialist Care, operating profit growth of 9%, all organic

 

Health Care:

  • Strong growth in revenue and operating profit, mainly driven by Mercury Health acquisition
  • Excellent PHG clinical and financial performance continuing
  • Wave 2 ISTC contracts in Manchester and Southampton expected to reach financial close shortly
  • Five new primary care contract awards/preferred bidder appointments
  • West Midlands diagnostics service decommissioned in February 2008, compensation claim under negotiation

John Nash, Chairman of Care UK, commented:
"Care UK's strategy continues to be demonstrably well founded as the NHS and Local Authorities implement their plans to further utilise the independent sector to deliver services, to shift care from hospital environments to the community and to empower consumers to exercise choice and control.

The board believes that Care UK's strategy to address both the Health and Social Care markets is a significant market differentiator given the increasingly evident transition towards greater integration of care pathways across the traditional boundaries between the NHS and Social Services. We are confident that our chosen markets continue to offer good opportunities for delivering exceptional long-term value to shareholders."

 

Cautionary statement

This half-yearly report has been prepared solely to provide additional information to shareholders to assess the group's strategies and the potential for those strategies to succeed. The half-yearly report should not be relied on by any other party or for any other purpose, and in particular, securities should not be acquired in reliance on the information contained in the half-yearly report. The half-yearly report contains certain forward-looking statements about operational and financial matters. Because they relate to future events and are subject to future circumstances, these forward looking statements are subject to risks, uncertainties and other factors. These statements are made by the directors in good faith based on the information available to them up to the time of their approval of this report. Such statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-looking information.