Tunstall buoyed by global revenues despite UK pressures

Declining turnover at Tunstall Healthcare Group Ltd’s UK and Ireland business due to difficult trading conditions in the assisted living market could not dampen global revenue for the business, which rose by 9.1%.

The connected healthcare solutions company saw revenue at its UK and Ireland operations fall to £82.7m in the year ended 30 September 2017, from £93.4m the year previous. EBITDA in the region grew 6.1% to £21m last year, from £19.8m in 2016.

Its strategic report said that the UK and Ireland market had seen ‘significant pressure and contracted’ during the reporting period, ‘primarily driven by a reduction in private sector build plans’.

On a positive note, the report said: ‘It is expected the assisted living market will recover in 2018, with indicative private sector build plans returning to prior levels supported by our strong order book.’

Global revenue at the business rose 9.1% to £240.6m, up from £220.6m in 2016, while cost of sales increased 10.2% to £133.4m last year, from £121m in 2016.

Following administrative expenses of £89m last year (2016: £90.9m), the group was left with an operating profit of £18.3m (2016: £8.7m). EBITDA rose to £51.4m, from £46.3m in 2016.

Tunstall continued to make losses before tax, improving to £46m last year, from £391m in 2016.

The group’s revenue was generated through independent living (£60.1m), assisted living (£59.1m, managed services contracts (£95m), remote patients monitoring and support (£17.3m), and integrated nursecall communications £9.1m).

With approximately 72% of the group’s revenues in non-sterling currencies, Tunstall’s financial performance was favourably impacted by the weakened pound. The group’s other main regions are the Nordics, Southern Europe, Central Europe, North America, and Australasia.

Its One Tunstall strategy is to provide technology-enabled solutions and managed services that help streamline its customers’ ability to deliver new models for health and care management in the community setting.

It specialises in two sectors: telecare delivery of social care and personal emergency alarm services; and telehealth delivery of healthcare solutions and services, supporting care providers to manage patients with complex long-term conditions.

The report said: ‘These services and solutions are delivered across both the public and private sector and, due to an ageing population with an increasing demand for social care and healthcare, shortage of healthcare professionals across the world, combined with ever-increasing constraints on government finances, the demand for these services and new models of care are growing.

‘Market trends in developed economies are seeing increased joint working and consolidated budgets across social care and healthcare and at an operational level, placing Tunstall in an advantageous position to address the combined requirement.’

The report highlights that health and social care budgets remain ‘under pressure’, with care commissioners and providers continuing to face ‘significant pressure’ to deliver more and better care services.

To address market trends, the group launched a new IP monitoring platform, enabling end-to-end IP care services. It is also investing in global data services platform called Evity that will mean the company can develop responsive products and services using multiple data sources and devices at pace.