Estia (ASX:EHE) says occupancy falls, costs expected to rise on the back of covid-19

Aged care operator Estia Health (ASX:EHE) says disruptions caused by COVID-19 has led to a fall in occupancy levels which will lead to higher ongoing costs.

The company says occupancy in mature homes fell from 93.8 per cent on March 17 to 91.7 per cent on April 26, where it has now stabilised.

Estia Health says the cancellation of travel, elective surgery and a slowdown in regular hospital activity during time, combined with a conservative approach to new admissions, accounted for the decline in occupancy.

The company has also received subsidies from the Aged Care Funding Instrument, which is expected to contribute $1.2 million of revenue in the 2020 financial year.

The government has also announced a one-off payment to residential aged care providers of either $900 or $1350 for each resident. This is expected to contribute up to $5.2 million of additional revenue in the 2020 financial year.

Additional operating costs are due to higher staffing levels and increased use of personal protective equipment.

Shares in Estia Health (ASX:EHE) are trading 3.5 per cent higher at $1.47.
 
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Source: Finance News Network