AAP Finance

Estia Health profit flat in challenging FY

By AAP Newswire

Aged care provider Estia Health has kept its full-year profit flat amid what executives call one of the sector's most difficult periods ever.

While revenue was up 7.1 per cent to $586 million in the 12 months to June 30, Estia's profit rose just 0.3 per cent as it invested in more staff training and opening two new nursing homes in Queensland.

"Although FY19 has been challenging, we are relatively pleased with our overall results," chief executive Ian Thorley said on Tuesday.

Estia said it spent $93.8 million on expanding its nursing homes over the year, the most it has spent since 2014, a figure that includes building a $28.7 million new home in Southport and a $32.5 million one in Maroochydore.

Estia spent $1.7 million responding to the royal commission into the aged care sector and said it was well positioned to respond to any new quality standards the commission might recommend.

Mr Thorley said the aged care sector needed to be reformed rather than just better regulated, however, and called for the uncapped supply of nursing homes beds to drive greater capital investment and competition.

At present, the government allocates new bed licences each year under competitive approvals rounds and ministers have resisted deregulation to protect rural and regional towns.

Estia, which operates 69 nursing homes, said its occupancy in mature homes fell 0.6 per cent to 93.6 per cent, although since June 30 it had ticked up to 94.1 per cent.

Mr Thorley said the skittishness over the royal commission and the weak housing market, which made people reluctant to sell their homes, had likely hurt occupancy.

Estia shares were up 4.9 per cent to a six-week high of $2.76 at 1431 AEST.

Estia will pay a final dividend of 7.8 cents, fully franked, down from 8.0 cents a year ago.

ESTIA

* Full-year revenue up 7.1 pct to $586m

* Net profit after tax up 0.3 per cent to $41.3m

* Final dividend of 7.8 cents per share, fully franked, down from 8.0 cents a year ago.