Pre-tax profits at the UK nursing home group owned by three of Ireland's best known businessmen last year increased by 22.5% to £39.02m or €46.57m.
New consolidated accounts filed by Barchester Healthcare Ltd show that the business recorded the sharp rise in pre-tax profits as revenues increased by £104.28m or 13.4% from £766.76m to £871.04m.
The group is co-owned by three of Ireland's best known and most successful businessmen, JP McManus, John Magnier and Dermot Desmond.
Barchester is the UK’s second largest nursing home operator and provides 14,543 registered beds across its portfolio of 223 registered services with the largest proportion located within London and the south east of England.
Numbers employed at the group increased from 14,947 to 16,250 last year.
In his report, group chairman, John Coleman said that the group "performed strongly from both care quality and commercial perspectives during 2023".
"Enquiries for places in the care homes and hospitals remained strong and translated into occupancy levels that were consistently higher in 2023 than 2022," he said.
He said that the group opened six brand new premium care homes in 2023.
The separate directors’ report states that the increase in revenues "was driven by an increase in both occupancy and fee rate inflation".
The group’s earnings before interest tax depreciation amortisation and rent (EBITDAR) last year increased from £239.6m to £271.6m.
The directors state that the rise was driven by the increase in occupancy, fee rate inflation and a reduction in agency usage, offset by increases to labour pay rates, and other home and central costs.
The group recorded operating profits of £75.6m and net interest charges of £36.59m reduced profits to a pre-tax profits of £39.02m.
The group benefited from £1.18m in 'other operating income’ made up of Government grants that was down sharply on the £16.68m received under that heading in 2022.
The group last year recorded post tax profits of £22.48m after incurring a corporation tax charge of £16.54m.
Staff costs last year increased by £75m rising from £395m to £470.68m that included share based payments in a management incentive plan surging from £937,000 to £11.48m.
A note states that in the management incentive plan, directors and certain employees have been given the option to subscribe three new classes of sharesin the company's parent firm, Grove Ltd.
Directors’ pay increased from £2.97m to £4.12m. Pay to the highest paid director last year increased from £1.73m to £1.98m.
The profit takes account of non-cash depreciation, amortisation and impairment costs of £43m.
The profits also take account of operating lease expense of £139.49m.
The business continued to expand last year and the accounts show that the group paid out £40.42m on the acquisition of assets.
At the end of December last, shareholder funds totalled £236.34m that included accumulated profits of £216m.
Cash funds increased from £24.25m to £31.1m.
Reporting by Gordon Deegan
