Chief executive of retirement homes specialist to leave later this summer

mccarthy & stone

Retirement homes specialist McCarthy & Stone has warned its operating profit for 2018 could be a third lower than last year, following a decline in both reservations and property prices.

Shares in the group slumped more than 14% following the announcement to 112p.

The firm has also announced the retirement following the year-end in August of chief executive Clive Fenton. He joined the firm in 2014.

In a trading update McCarthy & Stone said it had seen a “noticeable decline” in reservation rates since April, with potential customers becoming more cautious due to economic worries.

It was also seeing a slower secondary market and a softening of pricing, particularly in the South East.

Completions would be between 2,100 and 2,300, versus 2,302 last year, and the group expected operating profit for 2018 of between £65m and £80m, against the £96m made in 2017, with the profit impact of the unit shortfall skewed to the South East.

A strategic review, kicked off in April, was expected to lead to what the firm called a “more measured growth trajectory”.

Last year McCarthy & Stone reported annual turnover of £661m and pre-tax profit of £92m.

It is expected to announce its 2018 results in November.