G8 Education’s profit falls and its shares are getting crushed
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Shares in G8 Education fell hard after the childcare centre operator posted a 22 per cent drop in half-year profit to $23.7 million in the face of “challenging” industry conditions.
The stock fell 15 per cent to an intraday low of $2.04.
Revenue was 7 per cent higher at $393 million.
However, expenses rose because of regulatory changes to staff-to-children ratios.
“Looking forward, G8 is very strongly positioned to leverage its scale and reinforce its competitive market position,” said managing director Gary Carroll.
The impact of the new Child Care Subsidy was expected to stimulate demand through improved affordability.
G8 Education (ASX:GEM) declared a first-half fully franked dividend of 4.5c a share.
Here are the first half results: