Healthcare services provider Blatchford has begun reaping the benefits of various NHS contracts it took on last year but has struggled to protect its profits from increasing costs and pressures on margins from UK tenders.
The company grew its revenues by nearly 15% to around £61m last year, with 7% of the sales increase coming from clinical contracts with the NHS, which it won two years ago and began operating in 2018.
A prosthetics contract in Sussex and wheelchair contracts in Dudley and Oldham helped to expand Blatchford’s stake in the NHS market.
The wheelchair services were won as part of a joint bid with equipment provider Ross Care. The aim was to create a seamlessly integrated service and combine clinical experience with local knowledge to improve patients’ experience.
The group’s reliance on UK markets increased by 4% to 64% during the year, partly due to slower growth in Norway.
Blatchford reported a £3m operating loss in the year ended 31 March 2018 and EBITDA decreased by 55% to £2m.
The reduction in profitability was put down to an increase in costs, bonuses and consultancy fees paid during the business’s sale to CBPE Capital.
The company expects profitability to continue to come under threat as the NHS continues to push for fixed fee services, which is a challenge being faced by all healthcare services providers.
Blatchford sold a majority stake to CBPE in November for an undisclosed amount, declaring that the investment will give the firm the “financial firepower” to compete more effectively in the global prosthetics and orthotics market.
Blatchford underwent a demerger in March 2018 to separate the products and services arms of its business which saw it exit prosthetics manufacturing.
Over the year Blatchford has invested in a ‘grow your own’ scheme to create a sustainable clinical workforce. It noted that recruiting clinical employees and attracting young people to the profession can be a challenge and so is looking to tackle the skills shortage.
Last month, Blatchford began to deliver prosthetic, orthotic and technician services on behalf of Birmingham Community Healthcare NHS Trust.