in april 2016 it reported a 39% drop in profits which was blamed on the cuts in the local government social care budget and the introduction of the uk living wage, although its average weekly care fees rose by 3.4 per cent. the company has net debt of £565 million, because terra firma borrowed heavily to fund the purchase in 2012. the business has to find annual interest payments of about £50 million. earnings before interest, tax, debt and amortisation fell from £64.1 million in 2014 to £38.7 million in 2015. its property portfolio has been revalued down by £224 million to £505 million and its credit rating has plummeted.