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UK – Challenges ahead for Healthcare Locums amid several lawsuits

23 May 2012

The specialist healthcare recruitment agency Healthcare Locums (HLO:LSE) has restructured its business with a new management team amid legal proceedings in the UK and the US, the firm said today.

Ahead of today’s Annual General Meeting, non-executive Chairman Peter Sullivan has informed shareholders that “the Board has previously announced two major claims against the Company, one being a tribunal claim from the former Executive Vice Chairman Kate Bleasdale, and the other being a US action from a number of shareholders. The Board is awaiting the outcome of the tribunal claim and a decision is expected during summer 2012.”

Ms Bleasdale is suing the firm over “wrongful dismissal and sexual discrimination” in a multi-million Pound claim. In the US, proceedings have been filed against the agency as well as several former directors in the Southern District of New York. Various hedge fund investors allege the company and some former directors misrepresented its profitability and accounting practices.

“There are challenges ahead; however the reengineering of the business is well underway. We have a new professional business leadership team in place which has already brought significant stability to the Company, and which is implementing new growth strategies and innovative services to generate long-term improvements in financial performance,” Mr Sullivan said.

He also added that the firm’s growth rate will be affected by delays in tendering processes. “In the UK, the new national and regional NHS buying frameworks are expected to be awarded late in the third quarter this year. These framework agreements extend across all categories of health and the procurement processes are running some 3 months later than originally expected. Delays in the tendering process will have an impact on the timing of signing supply agreements which will affect our rate of growth this year.”

He also pointed out that the restructure of the firm’s UK business has increased costs while the firm sees business activity in Australia progress. “Healthcare Australia is making good progress and trading has been encouraging. In Australia opportunities for organic growth exist, in particular, by the further development of our nursing agency business in the Eastern states and the national roll out of the existing doctor locum business although the latter has been delayed by a change in HCA's management for personal reasons.”

Healthcare Locums was formed in 2003, providing workforce solutions to the health and social care industries. The firm supplies temporary and permanent doctors, nurses, allied health professionals and qualified social workers to public and private sector clients in the UK and internationally.

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