Maria Mallaband operates, manages and builds care homes across the UK; with its business expanding and constant developments in the pipeline, Exec Digital talks to Chairman and founder Phil Burgan about what goes in to providing great care.
By Jessica Summers
Established in Leeds in 1996, Maria Mallaband Care Group is one of the UK’s leading care home providers, renowned for outstanding facilities and services; Maria Mallaband ensures its residents receive a superior level of care.
Chairman and founder Phil Burgan, who named the company after his grandmother, spent 26 years as a pharmacist before making the business his full-time focus in 2002. Phil talks about what made 2008 different: “Last year was a very strange year for acquisitions – and that made it a highlight for me.
“There was a flurry of activity before April to meet the change in capital gains tax. Thereafter, the market was dead, so we made three acquisitions at the beginning of the year but there was nothing for sale between April and September. What then came on the market – well, people’s expectations were still too high! It’s only just before Christmas that people’s expectations have become realistic.”
With the UK officially in recession, Phil notices the changes for Maria Mallaband: “It’s much harder to get funding than it used to be. It is still possible to get funding and we are still getting it but something that would’ve taken four weeks to fund is now taking closer to four months.
It is only in the final quarter of last year that there was stock to buy and deals to be done. And now we’ve got a flurry of deals and we’re gradually working our way through them and trying to get them funded.”
With potential difficulties within the industry, Phil believes 2009 will be a challenging time for the industry: “I see those in the elderly business, those who are purely funded by social service fees, as having a bad time in the next two to three years.
“Fees have not risen as much as costs,” he adds. “In 2008, the whole industry was hit by rising costs – food bills went up 20 percent, heating/energy bills went up 30 percent... In the late 90s, something like 20 percent of the marketplace, 100,000 beds went to the wall through lack of profitability.
“The government recognised this in 2001 and instructed social services to start giving much improved fees, which stabilised the industry. But I see that cycle repeating itself.
“I changed my business model three years ago because I could see that trend coming and we moved more towards a privately funded sector.”
Currently, with around £24 million of development in progress, and with success this year greater than last year’s achievements, Phil insists the strategy is exactly the same: “We’re rolling out the developments that we have in the pipeline and we’re open for business to buy any more acquisitions at the right price.”
Maria Mallaband is not only renowned for providing great care to those within the homes but was actually last year’s winner of The Investors in People Award as well as making the Fast Track 100 for a second time. When reminded of this, Burgan is humble: “It’s just turnover growth and in fact it gets harder and harder.”
The truth lies with the amount of time and money invested into HR and people management; they have investors in people. The company’s mission statement which is ‘to be the best quality, most highly regarded care provider in the UK’, is obviously the primary focus and vision in all aspects of the business, despite high turnover of staff due to the nature of business within the care sector.
“We had a good look inside the business last year because it was quiet from an acquisition viewpoint; in the summer we reviewed a number of key people who weren’t performing as they should and who the business had outgrown - and we replaced those people,” says Burgan. “We don’t retain employees as much as we would like, but we do a lot better than most of our competitors because most people want to work for a quality operator; they like to know that they’re giving great care. We’re also a good employer; we generally offer a better environment to work in, both physically and in terms of training and support.”
So, how does Maria Mallaband stand now and what are future focuses for them? “We’ve got 50 care homes and 1,300 employees now. We have 23 elderly homes and 27 autism/challenging behaviour homes in five hubs around the country… We moved into Northern Ireland and we moved into the south of England. A lot of our activity, both acquisitive and by development, is going to be in the south of England from now on because that’s where the demographics are and that’s where the fees are.” 2009 looks to be a successful and exciting year for Maria Mallaband with plans to digress further within other sectors, and they are also benefiting from earlier projects: “We covered the whole spectrum of care from nursing care, residential care, young physically disabled, challenging behaviour, learning difficulties, autism. The only thing we haven’t done so far is mental health and we are moving into that sector this year. We’ve built two new mental health units in South Wales and I’m negotiating to buy a big mental health business at the moment.
“The move into autism was a big move,” Burgan continues. “It’s a totally different sector and when we bought a company called Autism Care UK in 2006 we inherited a lot of management and that gave us some expertise to launch that business. We’re hoping for a similar development with the venture into the mental health sector. With our improved infrastructure we aim to get the most out of what we’ve got.”
View Digital Corporate Profile of Maria Mallaband in Healthcare Digital March 2009