The UK’s largest care home chain paid out a £1.8million dividend to its private equity owners last year – despite losses deepening to £83million.
HC-One, which cares for more than 14,000 residents in 321 homes under the Kind Care Company brand, ramped up its average weekly fees by £22 to £792 in the year to September 2021.
The average resident is paying more than £41,000 per year – most with help from their local authority. But losses still grew to £83million from £68million a year earlier.
HC-One, which cares for more than 14,000 residents in 321 homes under the Kind Care Company brand, paid out a £1.8m dividend to its private equity owners last year
Despite tumbling further into the red, HC-One forked out £592,000 for its highest-paid director – almost double the £332,000 handed over a year earlier.
The package is thought to have gone to chief executive James Tugendhat – cousin of Tom Tugendhat, the MP running to be next leader of the Tory party – though HC-One did not disclose the recipient in its accounts.
Tugendhat took the reins at HC-One in 2020 from Sir David Behan, who became executive chairman following the departure of boss Justin Hutchens.
HC-One said the £332,000 paid a year earlier was not comparable, because it was not for a full year’s service.
In 2019, Hutchens was paid £809,000, and £469,000 the year before. But HC-One also handed a £1.8million dividend to its backers in the year to September 2021.
Its majority owner is US private equity firm Safanad. Investment firm Court Cavendish and another private equity house Formation Capital both own minority stakes.
Former Tory work and pensions secretary Baroness Altmann said: ‘It’s astonishing that a company that’s making big losses, in an industry that’s responsible for the very lives of some of the most vulnerable and frail people in our society, should be siphoning money offshore when the sector is in crisis.
There must be risks that some elderly people may lose their homes if the company is forced to either close homes or restructure in some way.’
A spokesman for HC-One said: ‘We have not paid a cash dividend to shareholders since 2017.’
The £1.8million payment was an ‘inter-company transfer’ used to ‘pay off a previous loan’, the spokesman added.
HC-One said its results for the year had been hampered by a fall in occupancy, as care homes slowed admissions during the ‘second peak’ of Covid in January to March 2021.
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