Investment column: WHC can get over this glitch
Friday 15 May 1998
If, as sources close to the company maintain, Philip Easterman acted on his own then he was at best misguided; at worst he faces further action by the Stock Exchange. The fact that he failed to inform the group's other executives about the profit progress of some of its subsidiaries suggests internal controls were found wanting.
In any case he had to go and if the company can salvage any credit from this situation is was by the way it organised a quick replacement. This unsavoury episode has undoubtedly tainted the reputation of WHC in the City. The profit warning came because it failed to attract the number of patients it forecast to its secure homes and suffered delays in opening new psychiatric units. But at least the end to these problems are in sight. Government cutbacks and intense competition has also hit revenues from its brain injury business.
In other words the string of problems have put WHC's plans back a year. But they have done little to affect the group's long-term potential.
The nursing home market has suffered from over-supply but occupancy levels are finally on the rise with demand rising sharply. Rising wage costs have kept margins in check but prospects are still encouraging.
Specialist health care analyst Laing & Buisson forecasts current-year profits of pounds 16.5m, which should recover to pounds 21m for the following 12 months putting the shares on a prospective p/e ratio of 15.
WHC's problems look like a glitch, albeit it a rather substantial one. It may take some time for the company to drag itself out of the sick ward but in the long term the shares do not look expensive.
- 1 Jeremy Clarkson 'does not see a problem' with his racist language on Top Gear, says BBC
- 3 ALS ice bucket challenge co-founder Corey Griffin drowns, aged 27
- 4 A third of employers never check job applicants' qualifications, survey finds
Richard Dawkins on babies with Down Syndrome: 'Abort it and try again – it would be immoral to bring it into the world'
Scottish independence: English people overwhelmingly want Scotland to stay in the UK
Isis threat: Cameron wants an alliance with Iran
Michael Brown shooting: Chaos erupts on the streets of Ferguson after autopsy shows teenager was shot six times – twice in the head
Bin bag full of cats' heads discovered near Manchester's Curry Mile
Disgusting, frustrating, but intriguing: how the country really feels about its politicians
iJobs Money & Business
£25000 - £35000 per annum: Harrington Starr: Junior Quant Analyst - C++, Boost...
£25000 - £35000 per annum: Harrington Starr: Service Desk Analyst- (Desktop Su...
£30000 - £50000 per annum: Harrington Starr: Junior Quant Analyst (Machine Lea...
£45000 - £55000 per annum: Harrington Starr: UNIX Application Support Analyst-...