It was a similar story to Estia for listed provider Japara with revenues also increasing slightly despite its 33 homes in Victoria feeling the effects of the pandemic – but new developments still stalled until the economy recovers.
Japara recorded COVID outbreaks at five of its homes during Victoria’s second coronavirus wave, with resident numbers reduced by 202 places over the half year but stabilising since October 2020.
As a result, its average occupancy fell to 89.2% over the period from 92.6% pre-COVID – which Japara estimates reduced its EBITDA by $7.4 million compared to the prior corresponding period.
As of 19 February 2021, occupancy stood at 85.5% in Victoria and 90.9% at its other homes.
But while its EBITDA dropped 67% from $24.3 million to $8 million, total revenue was up slightly by 3.6% to $220.3 million thanks to increased Government revenues and new places.
Net RAD and ILU inflows of $2.4 million were also recorded.
$41.4 million was spent on new homes, extensions and improvements and these new developments and refurbished homes continued to make an “incremental positive contribution”, the operator noted.
Its balance sheet was also maintained with $48 million of core debt, $160 million of development debt and available liquidity of $137 million.
Like the other listed operators, Japara did incur an impressive COVID bill – $7 million – but has been compensated $1.6 million from the Government for the additional costs and is now seeking full reimbursement.
“The first half of the 2020-21 financial year has been the most challenging yet with the impact of COVID-19 being extreme throughout the sector and on the business,” chief executive Chris Price said.
“Understandably, occupancy declined and the cost of operating increased as a result of COVID-19 and the response measures required, but both are stabilising. We expect the COVID-19 vaccine rollout to be a catalyst for improved operating conditions.”
The operator says it expects RAD inflows to improve as occupancy increases and new developments open with greenfield developments opening later this year to add another 220 homes to its portfolio.
Japara says it is also progressing on its development program with an identified pipeline of 628 aged care beds and three co-located seniors living development projects.
However, its investor presentation flagged decisions on future brownfield and greenfield developments would be held off until the outlook for the pandemic and economy looks more certain.
Japara told the market it would not provide guidance for its full year results due to the loss, noting it is “difficult to provide reliable earnings guidance” with no dividend for shareholders.
Japara has 50 aged care homes across Victoria, NSW, QLD, South Australia and Tasmania plus 180 independent living units co-located with five of its homes.