‘Uncertain’ times for New Century Group

New Century Group reported high losses for the year ending 31 December 2011 as it seeks to refinance and is locked in negotiations with one lender over the alleged mis-selling of rate hedging products which the provider said resulted in a significant loss of profit. Directors reported they had been advised by a leading counsel that there is a strong case that some rate hedging products had been mis-sold to the business by one of its lenders which caused a loss of profit. The group, which provides residential and nursing care posted turnover of £36.4m (2010: £35.6m) but costs of £23.3m and administrative expenses of 11.4m meant that an operating profit of just £1.7m was achieved (2010: £1.1m). This was subsequently wiped out by high interest charges of £2.3m (2011: £2.9m) and following taxation, a loss of £671,300 was recorded (2010: £4.2m)