Client Overview

Project Cassowary was a business who operated an aged care facility with c.130 residents (as well as Independent living), which was operating at a loss and in financial distress (including a separate facility which was closed). ​

The Board was seeking options to identify performance improvement areas and prepare a turnaround plan to improve business value and sale prospects. ​ ​

​Engagement Scope​

Engaged to conduct a full scale operational and financial business review to identify performance improvement options and design a turnaround plan in consultation with key stakeholders over a 6-week period.

Our Approach

Following a high-level overview of the business, the focus was on the following key aspects:​​

• Cashflow analysis and improvement initiatives, including short term funding requirements​​
• Financial performance reporting, specifically focussed on costs management and key drivers​​
• Staffing ratio, skillset and turnover management ​staffing mix, including financial impact of overtime, dependency of agency staff, recruitment needs and planning ​​
• Working with Clinical experts to understand key operational and compliance issues ​​
• Quantifying financial impact of performance improvement relating to clinical matters​​​
• Operational and staffing adjustments required by transition from ACFI to AN-ACC ​​

Key Findings and Outcomes​

A detailed report was prepared for the Board which addressed the following key aspects: ​​

Cashflow Forecast

A detailed cashflow review was completed to understand:​​

• The immediate funding support which was required in the short term (3 months)​​
• Further funding support which was required to support the business during the turnaround period (up to 6 months+)​​
• Itemisation of estimated capital expenditure required for compliance and occupancy growth purposes

Occupancy Growth ​​

The review identified that the facility encountered declining occupancy for the previous 12-24 months which resulted in current occupancy being extremely low. This was further impacted by the inability to secure staff to manage care needs to residents to allow for growth. A turnaround plan was prepared which provided for:​​

• A realistic occupancy growth timeline, including key action points to facilitate sustainable growth​​ ​
• Recruitment initiatives to adjust staff mix to align with resident profile ​​​
• Capital works required to improve reliability and bed availability​​
• Assessment of hotel procedures and costs to identify cost and efficiency savings​

Scenario Analysis ​​

A scenario analysis was prepared to assist the board in understanding the financial performance impact based on the forecast turnaround timeline and key occupancy benchmarks. Key capital expenditure and operational metrics were flagged as part of these scenarios to assist with funding allocation and monitoring of value drivers. ​​

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