Update on treatment of sleep-ins

Cambian Group plc

Update on treatment of sleep-ins

16 July 2018

Cambian Group plc ('Cambian', 'the Group', 'the Company'), one of the UK's leading specialist education and behavioural health services providers, notes that on 13 July 2018, the Court of Appeal overturned an Employment Tribunal decision made in 2016, which had ruled that social care staff should be paid the National Minimum Wage ('NMW') for sleep-in shifts. The Court of Appeal ruled that sleep-in shifts fall into an exception from the NMW as staff are only 'available for work', which means the NMW would only be payable when the person was awake and working and not while asleep.

As noted in our last Annual Report, Cambian has provided £9.3 million against the historic treatment of sleep-ins as at 31 December 2017. Going forward, should the Court of Appeal ruling be upheld and there be no accepted alternative industry or regulator counter proposal, the Board expects the impact of this ruling to result in (i) the write-back of the provision of £9.3 million, and (ii) an improvement in the Group's EBITDA of between £2.0 million to £3.0 million in the year ending 31 December 2018, an improvement of between £1.5 million to £2.5 million in the year ending 31 December 2019, and an improvement of between £1.0 million to £2.0 million in the year ending 31 December 2020, compared to the Board's previous expectations.

Cambian Group plc Tel: +44 (0) 20 8735 6150

Saleem Asaria, Chief Executive

Anne Marie Carrie, Chief Operating Officer

Anoop Kang, Chief Financial Officer 

CNC (communications advisor) Tel: +44 (0) 203 755 1600

Richard Campbell

Katherine Fennell

Forward-Looking Information

This announcement may contain certain "forward looking statements" regarding the financial position, business strategy or plans for future operations of the Group. All statements other than statements of historical fact included in any document may be forward looking statements. Forward looking statements also often use words such as "believe", "expect", "estimate", "intend", "anticipate" and words of a similar meaning. By their nature, forward looking statements involve risk and uncertainty that could cause actual results to differ materially from those suggested by them. Much of the risk and uncertainty relates to factors that are beyond the Group's ability to control or estimate precisely, such as future market conditions and the behaviours of other market participants, and therefore undue reliance should not be placed on such statements which speak only as at the date of this announcement. The Group does not assume any obligation to, and do not intend to, revise or update these forward looking statements, except as required pursuant to applicable law.

Publication on a website

A copy of this announcement will be made available, subject to certain restrictions relating to persons resident in restricted jurisdictions, on Cambian's website at http://www.cambiangroup.com/cambiangroup/investor/home.aspx promptly and in any event by no later than 12 noon (London time) on 17 July 2018. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

No Profit Forecast

Nothing in this announcement is intended, or is to be construed, as a profit forecast or to be interpreted to mean that earnings per Cambian share for the current or future financial years will necessarily match or exceed the historical published earnings per Cambian share.