Care homes warn Chancellor of ‘catastrophic collapse’ over living wage

Four Seasons posts a 39% drop in earnings

Britain’s biggest care homes group Four Seasons Health Care has reported a 39% fall in annual earnings to £38.7 million, with the company’s private equity owner in talks with lenders to secure the company’s future.

Four Seasons, which has 454 homes with 23,500 beds, has been badly affected by cuts in local authority fees and rising costs, including the introduction of the National Living Wage.

Owned by City financier Guy Hands’s private equity vehicle Terra Firma, the company said it is exploring all options for the business.

Four Seasons chairman Robbie Barr said: “The group has adequate financial resources and liquidity for the medium term. I recognise that the group’s capital structure is not suitable for the long-term needs of the business. Options are now being explored.”

The options thought to be under consideration include refinancing the debt, a sale or a most likely option of a debt-for-equity swap with lenders.

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