12th Oct 2005 07:00
CareTech Holdings PLC 12 October 2005 For Immediate Release 12 October 2005 CareTech Holdings PLC ('CareTech' or 'the Company') FIRST DAY OF DEALINGS ON THE AIM MARKET OF THE LONDON STOCK EXCHANGE CareTech Holdings PLC (AIM: CTH ), a leading UK provider of learning disability care services, is pleased to announce its flotation on the AIM market of the London Stock Exchange today. Background • £11.3 million before expenses has been raised on behalf of the Company via an oversubscribed Placing at a Placing Price of 160 pence per share. • On admission to AIM, the market capitalisation of CareTech at the Placing Price is approximately £58 million. • The net proceeds of the Placing are be used to repay existing indebtedness and to fund the growth of the business organically and by acquisition. • £14.5 million of existing ordinary shares have also been placed at the Placing Price on behalf of CareTech's founders and management team. • Brewin Dolphin Securities is acting as Nominated Adviser and Broker to the Group. • CareTech was founded in 1993 by Farouq Sheikh, Executive Chairman and Haroon Sheikh, Chief Executive Officer. CareTech offers high quality specialist support and residential care to people with physical disability, challenging behaviours, mental health problems and autistic spectrum disorder using an 'ordinary life' model of care. • CareTech's services comprise 61 residential care homes (435 beds) and 2 day centres (55 places) located primarily in the South of England and West Midlands. The properties are a mix of freehold and leasehold. Services are entirely funded by the NHS or local authorities. • For the year ended 30 September 2005 CareTech has estimated that EBITDAR (operating profit before interest, taxation, depreciation, amortisation and property rental costs) will not be less than £5.522m (2004: £3.750m) and that profit before taxation will not be less than £1.195m (2004: £0.227m (pre-exceptionals)). • The Group has strong visibility of earnings based upon the long term contracts it has with commissioning local authorities and health authorities. The annuity style income arises because people with a learning disability are generally expected to have a near normal life expectancy. CareTech's residents are anticipated to spend a substantial proportion of their lives in CareTech's homes. The Directors expect the average length of stay for a resident at a care home to be in excess of 20 years. • In 2004, the overall value of the learning disability care market ('Market') in England was estimated at £2.1billion and continuing growth is forecast. Of this figure 47% was accounted for by the 'for profit' sector of which CareTech is a part. • There is a long term and continuing shortfall in the number of residential care places available. In 2003, this shortfall was estimated to be at least 25,000 care places in England. Commenting on the flotation, Farouq Sheikh, Executive Chairman, said: 'I am delighted by the response to CareTech's flotation. CareTech has a huge opportunity before it. There is enormous need in the community for our services and we will always closely align this with building shareholder value. These are very compatible objectives which we believe will lead to CareTech becoming a major force in the learning disability care market.' For further information please contact: CareTech Holdings PLC Farouq Sheikh, Executive Chairman 01707 652 053 Buchanan Communications Tim Anderson/Diane Stewart 0207 466 5000 Brewin Dolphin Securities Matt Davis/Andrew Emmott 0161 214 5552 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
CTH.L