Estia Health reveals how COVID-19 is still hurting its business

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The ASX-listed provider has informed the market that the COVID-19 pandemic is still seriously hurting its finances.

Its spot occupancy rate in its NSW and Victoria homes on 30 April, where COVID cases are at its highest, is 87%. Compare that to other states where the occupancy rate is 97.1%.

“Given the ongoing elevated level of community transmission, multiple COVID-19 outbreaks continue to impact the Group’s 68 homes. Operationally, occupancy levels remain adversely impacted compared to historic performance,” Estia Health said in the update to the ASX.

“Recovery in occupancy rates since the initial Omicron wave in December and January has been slower than experienced following earlier waves during the pandemic. Group occupancy has averaged 90.5% in the 4 months ended 30 April 2022 and has averaged 91.7% for the 10 months to date in FY22. Spot occupancy was 91.0% at 30 April 2022.”

Estia Health also revealed the processing time for reimbursement of COVID expenditure from the Federal Government is being “substantially delayed”.

“As a result, it is likely that a significant proportion of claims submitted by the Group relating to FY22 COVID-19 outbreak costs, currently $20.3 million, may not be approved by the Department prior to 30 June 2022.

“Should this be the case, then in accordance with Australian Accounting Standards, unconfirmed claims are unlikely to be recognised as income in the financial results for FY22, which will be below market expectations as a result. Grants confirmed after 30 June 2022 will form part of FY23 earnings.”

Estia Health, which appointed Sean Bilton (pictured) as CEO and Managing Director last month, has seen its share price fall 6.58% in the YTD.