Bons Secours profits fall despite increased revenue

Reductions in the numbers holding private health insurance contributed to profits at the country’s largest privately-owned hospital group decreasing by 31% to €5.1m last year.

New figures lodged by the Cork-based Bon Secours Health Systems Ltd show that the group recorded the drop in profits in spite of revenues increasing marginally to €223.7m last year.

The firm’s profits decreased from €7.4m to €5.1m.

The group operates over 850 beds in privately run hospitals in Cork, Dublin, Galway and Tralee employing over 2,700 staff supporting 300 consultants.

The directors’ report states that the group is facing a number of challenges including lower prices from health insurers; unrecoverable inflationary costs such as payroll increments; reductions in the numbers holding private insurance cover, augmented by the continued tendency of others to downgrade the level of insurance cover held.

A spokeswoman for the hospital group said yesterday: “These challenges have impacted adversely on the 2013 results and led to a further significant deterioration in 2014 year to date.

“Management have initiated a comprehensive programme of actions that focus on both business development and a cost base review across the five hospital locations, in order to meet these challenges while continuing to provide and improve upon the quality and range of services going forward.”

The group has a strong balance sheet with accumulated profits standing at €70.7m. The group’s shareholder funds stood that €124.5m.

The firm’s cash during the year reduced from €42.8m to €34.7m.

Numbers employed by the group decreased from 2,744 to 2,713 with the group’s staff costs remaining static at €120m that included €107.2m on salaries; €10.8m on social welfare costs and €2.4m on other pension costs.

The group paid down its bank debt in the year from €14.12m to €8.6m.

The group recorded income of €734,000 from car-parking last year compared to €642,000 in 2012.

On the firm’s future developments, the directors state that they “intend to continue to develop the group’s ability to deliver high quality medical care to patients at each of its hospital locations”.