COVID had a major impact on the listed providers’ Victorian homes – now its AGM has provided more insights into the challenges – and successes – the operator experienced in FY20.
Estia’s earnings before tax for the 12 months to 30 June 2020 fell to $35.8 million, with a non-cash impairment charge of $144.6 million driving the provider into negative territory.
Chairman Dr Gary Weiss AM (pictured right) attributed this charge to declining financial performance, the ongoing uncertainty of future sector funding and financing, exacerbated by the impacts of COVID-19.
40,000 hours in quarantine leave paid out
As we reported here in The Daily RESOURCE last week, the provider had 11 outbreaks in Victoria – four with a high number of cases – which increased its costs, particularly staffing and PPE.
Estia also introduced paid quarantine leave in March with 1,350 employees taking 40,718 hours of paid leave – a number of staff also volunteered to travel from NSW and Queensland to assist in their Melbourne colleagues.
As a result, the Board elected not to pay a final dividend for the year, leaving total dividends for FY20 at 5.4 cents per share, fully franked, while the board and executive foregoed their STI targets despite meeting them.
RAD flows “largely unaffected”
However, there was good news.
Net RAD flows were “largely unaffected” by the pandemic, sitting at $840.6 million at 31 October 2020, an increase of $4.3 million since 30 June 2020, while net debt at 31 October was $114.5 million – providing liquidity of $211.2 million under the group’s syndicated loan facility.
The operator also invested strongly in its portfolio with $80.6 million of capital put into new homes at Maroochydore in Queensland and Blakehurst NSW and refurbishing 13 of its 69 homes.
600 new beds paused
Estia did hit pause on its development pipeline of 600 new aged care beds (pictured above) over the next three to four years until “sector policy, funding and economic conditions” can be assessed.
There were also some key staff appointments,
In addition to its policy of 24/7 RNs, Estia appointed an independent external pharmacist and an Infectious Diseases Physician to its COVID committee.
Low staff turnover compared to other operators
Interestingly, Estia’s employee turnover continued to go down to 18.3% from just over 20% last year while its use of casual labour, used for short leave purposes, was just 8% by the end of June 2020.
Estia has 8,000 residents and 7,500 staff across its 69 homes in NSW, QLD, Victoria and SA.
