Shares in Spire Healthcare tumbled on Tuesday morning after the group reported disappointing first-half results.
Pre-tax profit for the healthcare firm 7.9 percent to £8.2 million, whilst revenue fell 1.1 percent to £475.6 million.
Britain’s second-largest healthcare firm said that a “prolonged decline” in NHS volumes affected the group’s margins.
Spiral issued a profit warning last week and the FTSE 250 group has attempted to cut costs by reducing its capital spending.
The chief executive Justin Ash said: “The unprecedented decline (both in scale and speed) in NHS admissions has led to Spire having to announce disappointing H1 2018 results and a revised outlook for the financial year as a whole.”
“More broadly, the headwinds that Spire is facing, as the largest company in the sector by revenues and EBITDA, appear to be translating into significant business challenges for many sector participants, which in turn may lead to opportunities for Spire,” he added.
The group’s outlook has been affected and instead of the full-year underlying earnings to be £150 million, which was expected in 2017, the adjusted earnings are between £120-125 million.
Liberum analyst, Graham Doyle, said: “Spire released its H1 2018 results this morning but following its profit warning last month there are no surprises for the first half.”
“However, management provided a more granular guidance today than it did a month ago, now expecting FY2018 EBITDA of £120-125 million. We believe that this will disappoint versus consensus at c.£135 million implying a downgrade of nine percent at the mid-point.”
In a separate statement, the health group named John Forrest as its new COO.
Shares in Spire (LON: SPI) fell seven percent in early trading to 157.5p.
Shares are currently trading down 4.20 percent at 162,10 (1421GMT).
