Care home giant Four Seasons braces for £15 million hit from Covid-19 crisis

Care home operator Four Seasons on Wednesday said it expects a £15 million hit from Covid-19 after a twelve-fold increase in PPE costs and a sharp drop in occupancy rates.

The healthcare operator, which looks after more than 10,000 people in the UK, has seen coronavirus cases in 60% of its care homes and recorded 490 deaths from confirmed or suspected Covid-19.

To combat the crisis it has forked out £2.5 million on protective gear for staff and extra cleaning. It spends £200,000 on such services in a normal year.

Occupancy levels have also plunged to 80% as fewer people are admitted into care homes following fears over the coronavirus outbreak.

Typically occupancy rates are around 90% and a fall in occupancy rates means Four Seasons is raking in lower levels of revenue.

Weekly admissions across the group dropped by as much as 50% at some points although management said it had started to stabilise in recent weeks.

Four Seasons chief executive Jeremy Richardson said the challenges to the sector were “unprecedented”.

“This is a very difficult time for everybody working in the sector. What has really struck me is the way the team has rallied around and gone above and beyond working in very difficult circumstances.

"Morale remains relatively high. It’s our job to support them at a very difficult time."

Around one in ten workers were off sick during the period due to self-isolation or Covid-19 symptoms, forcing the firm to use agency staff.

That added £1 million to the wage bill. Since then absences have fallen to around 7%

Four Seasons is in discussions with 68 local councils around additional funding measures to ease the burden.

The company believes around three-quarters of the extra PPE and staff costs will be covered by additional funding from local government although it will not cover the occupancy decline.

Before Covid-19 hit, Four Seasons appeared to be improving with occupancy rates up 0..9%