Abode Recruitment

The UK’s biggest care home operator said it had slipped into the red after a “very difficult” year for the group.
Southern Cross Healthcare, which warned over profits in the summer, reported a £22.9 million pre-tax loss in the year to September 28 against previous profits of £3 million.
It said it had stabilised the group since its troubles in July, when it was forced to renegotiate its finances and alert over its profits after lower than expected occupancy rates.
A new chief executive, Jamie Buchan, will start in January and lead efforts to cut costs and improve quality of care. But the Darlington-based group outlined a tough year ahead, with a local authority clamp down on care spend adding to cost pressures from tighter regulation, legislation and minimum wage increases.
Southern Cross hopes to benefit from the demise of smaller rivals in the difficult trading climate, with expectations for its occupancy levels to remain steady in the current year. It said it had swung in to the red over the past financial year, partly as a result of losses on its freehold property assets.
Southern Cross sold £60.9 million worth of properties for £51.6 million in August and September and took a £4.5 million hit after revaluing remaining properties held for resale. The group also reported a drop in average occupancy in the year to September 28, from 90.7% to 89.5%.
Southern said in the summer occupancy levels at its homes were being impacted by central Government social care funding reaching local authorities later than in recent years, which saw admissions take longer.
“Attrition rates” among nursing residents – deaths – were also higher than normal, it said. However, there are market concerns that the economic downturn may affect demand for private care for the elderly and put downward pressure on fees.
Southern assured that demand for care home services remained strong, with no drop-off in admission rates. It is also introducing greater provisions for day care, home-based support and respite care should there be a return in the trend for family-based care for elderly relatives.
Southern was floated by previous owner Blackstone for £423 million two years ago, but the company has seen its market value more than halve since then. The group is by far the biggest UK operator of care homes with an 8% market share, employing 42,000 staff across 735 homes in the UK. It had more than 37,400 beds at the end of its financial year.