The future of Four Seasons Health Care, Britian's largest care home operator has been cast into further doubt. The group, which runs 450 care homes as well as 50 specialist care units in hospitals employs 30,000 staff to look after 20,000 residents and patients, announced losses of more than £25 million and has launched a review of its finanaces.
Owned by Terra Firma, the buyout firm controlled by Guernsey-based financier Guy Hands, Four Seasons is paying more than £50m a year in interest on debts of £500m. But its earnings before interest, tax and other charges were just £51.5m in the last 12 months, according to the latest accounts. Four Seasons said its profits will take a further £10m hit from the compulsory £7.20-an-hour minimum pay for the over-25s, which comes into effect in April next year and should rise to £9 an hour in 2020.
Terra Firma bought Four Seasons in 2012 for £825m, its largest investment since a disastrous multibillion-pound bet on the music major EMI. The deal took place shortly after the collapse of previous care homes market-leader Southern Cross in 2011.