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Private healthcare firm Bupa 2015 profit falls 2 pct

Published 03/03/2016, 06:00 pm
Updated 03/03/2016, 06:10 pm
© Reuters.  Private healthcare firm Bupa 2015 profit falls 2 pct
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LONDON, March 3 (Reuters) - Political change in Spain, wage rises in Britain and an economic slowdown in Australia have put pressure on healthcare markets, British private healthcare group Bupa said as the firm posted a 2 percent drop in 2015 underlying pretax profit.

Bupa gets around 70 percent of its revenue from health insurance but also operates hospitals, care homes and medical clinics in many of its businesses around the world.

December elections plunged Spain, a key region for Bupa, into political limbo and dampened sentiment towards private-public partnerships in the healthcare sector, chief executive Stuart Fletcher said. A planned rise in minimum wages in Britain has hurt the firm's care home business.

Australia, another of the firm's key areas of business, has been hit by falling commodity prices, driven by a drop in Chinese growth.

"The operating environment is pretty challenging," Fletcher said.

Underlying profit before tax fell 2 percent to 582.5 million pounds ($819.34 million) on a constant exchange rate basis, though customer numbers rose 12 percent to 32.2 million.

The unlisted company, set up in 1947 just ahead of the formation of Britain's national health service to provide an alternative health provision, would rank around 50th in the FTSE 100 .FTSE index if it was listed.

Its debt issues include a 350 million pound seven-year bond launched in 2014 with a coupon of 3.375 percent, currently trading at a yield of 3.1 percent GB107530975= .

Fletcher said there were no plans to issue more debt this year.

The firm posted a solvency capital ratio under new European rules of 180 percent. A ratio of 100 percent means that an insurer has set aside enough capital to meet underwriting, investment and operational risks. ($1 = 0.7109 pounds)

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