Optima Health (LON: OPT), the UK’s largest independent provider of occupational health services, saw its shares fall on Monday despite full-year results that beat market profit expectations. Revenue rose 14.8% to £120.6m and adjusted earnings came in ahead of forecasts, but investors focused on a sharp rise in debt.
Shares opened at 250.06p, fell as low as 232.78p, and traded around 239p in early dealing, down 3.4% from Friday’s close of 247.5p.
Optima published audited results for the year to 31 March before Monday’s market open. Adjusted EBITDA, a measure of underlying operating profit, rose to £20.1m from £17.6m and came in around 10% ahead of prior market expectations. The year was dominated by the transformational £100m acquisition of PAM Healthcare, completed on 26 March, which chief executive Jonathan Thomas said had “enabled us to expand our capabilities and strengthen our ability to support customers across the UK and Ireland,” adding that integration was “progressing well, with cost synergies already being delivered.”
The PAM deal was funded largely with debt, and net debt excluding lease liabilities jumped to £94.4m from just £2.2m a year earlier. A £30m bridge loan used to help finance the acquisition was repaid in April using proceeds from an underwritten Open Offer that raised around £35m, but the enlarged share count diluted per-share earnings. Statutory basic earnings per share halved to 2p from 3p, while adjusted earnings per share fell to 12p from 19p, even as statutory pre-tax profit held roughly flat at £2.5m.
Thomas said the company’s priorities were “maintaining high quality service delivery, progressing integration activities and our transformation programme, and advancing strategic initiatives to support the next phase of growth towards our stated ambition.”
Optima reiterated medium-term targets of £200m revenue and £40m adjusted EBITDA, underlining management’s confidence even as the market weighed the leverage taken on to reach them.