Orpea SA - ORRRY STOCK NEWS

ORPEA Group reported a 6.4% increase in third-quarter revenue, totaling €1,181.3 million, with 4.0% organic growth. Over nine months, revenues reached €3,475.8 million, marking a 9.3% growth and 5.5% organic increase. Key growth was observed in Central Europe (+8.9%), Eastern Europe (+11.9%), and the Iberian Peninsula and Latin America (+45%). The company is undergoing a transformation plan, with discussions on a debt restructuring amid challenges posed by inflation and an ongoing conciliation procedure for its €4 billion unsecured debt.

ORPEA S.A has initiated an amicable conciliation procedure to renegotiate its debt with financial creditors, as the company faces an estimated asset impairment of €2.1 to €2.5 billion by the end of 2022. The process, approved by the Nanterre Commercial Court, aims to restructure financial obligations without affecting operations. Gross debt as of December 31, 2023, stands at €2.439 billion. The company is set to unveil its transformation plan on November 15, following the resumption of trading on October 26, 2022.

Laurent Guillot has been appointed as the new Chief Executive Officer of ORPEA, effective July 1. He has established an Executive Committee focused on transforming the group's strategic plan, enhancing financial stability, and improving care pathways for residents. The committee includes experienced leaders in various sectors, emphasizing a revamped real estate strategy. ORPEA operates in 22 countries, employing over 71,000 staff and serving more than 255,000 patients annually, aiming for a comprehensive reconstruction to address current challenges.

ORPEA has released its half-year financial report for the period from January 1, 2022 to June 30, 2022, available on its website and at its headquarters. The company operates in 22 countries, focusing on care for elderly, post-acute care, and mental health services, with over 71,000 employees and more than 255,000 patients treated annually. The English version of the report will be available soon. ORPEA is listed on Euronext Paris and is part of various indices, including MSCI Small Cap Europe.

ORPEA Group's consolidated results for H1 2022 reveal a 10.9% revenue increase to €2,295m. However, the company reported a net loss of €269m, significantly impacted by asset impairments and unethical actions by former management. EBITDAR fell by 17.1% to €427m, with an EBITDAR margin decrease of 628 bps. Additional financial strains include increased operational costs amid inflation, particularly in energy, leading to a 64.6% drop in recurring operating profit. ORPEA plans measures to improve operations and uphold financial commitments amidst challenging market conditions.

ORPEA reported a 10.9% increase in revenue to €2,295 million in H1 2022. However, the EBITDAR margin decreased to 18.5% due to the reduction in Covid-19 compensation and ongoing inflationary pressures, particularly for energy. The firm opened 1,547 new beds amid an improving occupancy rate. CEO Laurent Guillot emphasized the need for enhanced safety and care quality. Despite revenue growth, the firm anticipates financial performance to decline in H2 2022, influenced by energy market volatility and operational challenges.

In response to a letter from the French National Solidarity Fund for Autonomy dated July 29, 2022, ORPEA has confirmed its commitment to reimburse €25.7 million related to unappropriated public grants. The company emphasizes the importance of using life auxiliaries as caregivers and plans to address staffing challenges through a significant recruitment initiative of 550 monthly hires until the end of 2022, increasing to 800 in 2023. ORPEA is committed to responsible cooperation with authorities while ensuring the quality of care amidst workforce shortages.

ORPEA has received a notice from the French National Solidarity Fund for Autonomy (CNSA) demanding the return of €55.8 million in funding, deemed unduly received. This notification is based on the report from the joint IGAS-IGF mission dated July 29, 2022. ORPEA intends to reimburse the incorrectly recorded amounts and will provide its responses to the CNSA regarding any assessment differences within the specified timeframe. The company operates in 22 countries, specializing in elderly care, post-acute rehabilitation, and mental health, caring for over 255,000 patients annually.

ORPEA's Combined Annual General Meeting has successfully appointed four independent directors, including Guillaume Pepy as Chairman, significantly enhancing the board's independence with 92% independent members. The meeting approved major resolutions including the 2021 financial statements and various appointments, while rejecting the remuneration components for Yves Le Masne, ensuring he receives no bonuses or compensation post-termination. The newly structured committees aim to improve governance, risk management, and HR policies, reflecting a commitment to transformation within the company.