Shares Estia Health fell hard as the aged care provider cut the outlook for its earnings.
A short time, ago the shares were down 9% to $3.00.
Shares in companies with exposure to Australia’s aged care sector have taken a hit since the federal government last month cracked down on extra fees being charged to residents.
Today Estia lowered guidance for underlying EBITDA (earnings before interest tax, deprecation and amortisation) to between $86 million and $90 million from $105 million.
“We have commenced a rigorous strategic review of our business and have already identified several non-core assets that we will be seeking to divest to help reduce costs and ensure we maintain a strong balance sheet,” says acting CEO Norah Barlow.
“The strategic review will be focused on taking costs out of the business and improving margins further, but without compromising on our commitment to continue to deliver high quality aged care services to our residents.”