Caretech half-year revenue booms after Cambian acquisition

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BRISTOL, ENGLAND - FEBRUARY 16: In this photo illustration an elderly person sits in a chair at home on February 16, 2015 near Bristol, England. The issues affecting the elderly, along with education and the economy are likely to be key elections issues in the forthcoming general election in May. (Photo by Matt Cardy/Getty Images)

Care home operator Caretech has posted a sharp rise in revenue and profit for the half year after snapping up rival care and education firm Cambian Group.

Read more: Competition watchdog launches probe into merger between Caretech and Cambian Group

The figures

Caretech’s revenue soared 120 per cent to £192.5m in the six months to the end of March.

Underlying earnings before interest, tax, depreciation and amortisation (Ebitda) rose 71 per cent to £33.3m.

Pre-tax profit jumped 50 per cent to £20.7m.

Net debt increased 99 per cent to £293m.

Why it’s interesting

The figures mark Caretech’s first results since its bumper £372m takeover of Cambian, which provides specialist care and education care.

Caretech described the deal, which was cleared by the Competition and Markets Authority in February, as “transformational”, adding the integration of the firm was “well underway”.

Removing the impact of the Cambian deal, Caretech’s like-for-like revenue rose 12 per cent to £98m, while like-for-like Ebitda ticked up to £21m.

Caretech, which operates more than 550 residential facilities and specialist schools across the UK, said its property portfolio was valued at £774m following the acquisition.

The firm said it remained on track for its full-year results, with cost savings of at least £3m expected as a result of the merger.

Shares in Caretech rose more than three per cent following the announcement.

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What Caretech said

“I am delighted to be reporting our first financial results following the acquisition of Cambian in October 2018,” said executive chairman Farouq Sheikh.

“The group’s performance reflects the scale of the acquisition and delivers a substantial increase in revenue and Ebitda compared with the same period last year.

“Caretech has grown into a leading national provider of social care and education services to some of the most vulnerable people in our society.  These results build on the foundations we have laid out over the last 25 years and we look forward to the future with confidence.”