Care UK's results underlined the defensive nature of most of the company's earnings, although the squeeze on public sector spending saw management offer cautious words on the outlook.
It's biggest division, social care, saw sales rise 5 per cent to £250m, but management expressed concern over future funding, pointing out that local government finances were under pressure and that social care had not received the same level of political guarantees on spending as healthcare. However, business is holding steady in its residential and community care operations, with the company announcing a raft of new developments and contracts.
The healthcare division, which runs independent treatment centres for the NHS, saw sales leap 54 per cent to £160m, thanks to a full-year contribution from its acquisition of PHG in 2008 and a £24.5m contribution from two new independent treatment centres (ISTCs) in Manchester and Southampton commissioned in the half. On an underlying basis, sales climbed 12 per cent, but as yet there's been no word on renewal of contracts to run centres at Plymouth and Barlborough, which end in the first half of next year. The two centres generated an aggregate revenue of £34m in 2009, and management said it was disappointed at the uncertainty over its future involvement.
Broker Investec forecasts pre-tax profits of £32.6m, with EPS of 35.5p (£27.7m and 30.1p in 2009).
CARE UK (CUK) | ||||
|---|---|---|---|---|
| ORD PRICE: | 355p | MARKET VALUE: | £217m | |
| TOUCH: | 355-359p | 12-MONTH HIGH: | 405p | LOW: 225p |
| DIVIDEND YIELD: | 1.4% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 196p* | NET DEBT: | 130% | |
| Year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2005 | 157 | 13.5 | 17.5 | 3.33 |
| 2006 | 183 | 14.2 | 18.0 | 3.65 |
| 2007 | 249 | 14.5 | 20.3 | 4.02 |
| 2008 | 342 | 1.6 | -4.98 | 4.43 |
| 2009 | 410 | 21.0 | 23.0 | 4.85 |
| % change | +20 | +1213 | - | +9 |
Ex-div: 20 Jan Payment: 17 Feb *Includes intangible assets of £85m, or 139p a share | ||||
