The dental services company, 1300 Smiles Limited (ASX: ONT), today released its first half-year results for the six months ended 31 December 2018. The company posted solid financial performance over the period with 7% growth in OTC revenue, 6% growth in EBITDA, and 4% growth in Net Profit After Tax compared to the previous corresponding period.
Over-the-Counter Revenue was up 7.1% to $30.0 million, a record high boosted by a combination of solid growth across its long-established practices plus the incorporation of the practices acquired toward the end of the 2018 financial year. In aggregate, the company reported 3.9% growth in statutory revenue of $20.52 million for the first half of Fiscal 2019. Its 1H FY19 EBITDA was up by 5.7% to $7.1 million, reflecting the favourable business outcome compared to industry competitors.
The company got hit by the massive disruption in its Townsville operations as the recent flood in Townsville affected its dentists, staff, and patients across its seven practices in the region. There have been significant damages to the area and its people with the company’s Townsville centres getting affected to some degree by the floods of early 2019. It forced the company to temporarily shut down its largest regional centre in Queensland, Townsville, for few days while the city itself was paralysed. However, the company confirmed that all of its Townsville facilities are well positioned to continue operation and serve the growing demand for dental services in almost all of the regional centres the company serves in Queensland.
On the bottom line front, the company reported 1H FY19 Net Profit after tax of $4.1 million, up 4.3% on 1H FY18 despite facing the setback in Townsville operations due to flood. While maintaining the balance sheet at the conservative level, the company declared the fully franked interim dividend of 12.5 cents per share payable on 27 March 2019. It represents the dividend for six months ended 31 December 2018 to the company’s shareholder entitled to received divided as on the record date of 19 March 2019.
Moreover, 1300 Smiles is expected to announce some key acquisitions of additional larger practices in the near future which could deliver the additional annual revenue of at least $6.5 million as per the company’s estimate.
As at 31 December 2018, the company’s net tangible asset backing per ordinary share stood at 47.4 cents, up from 40.0 cents in the previous corresponding period. Its cash balance at the same time was $2.156 million compared to the opening cash balance of $2.295 as on30 June 2018.
1300 Smiles Limited is an Australia-based dental and management services company that operates full-service dental clinics across Australia with the majority of them located in Queensland
ONT traded flat on 19 February 2019 with the daily volume change of 4,273 shares and Price to Earnings multiple of 19.250 x. Over the past 12 months, the stock has witnessed a downtrend of 6.06% despite the positive return of 1.31% in the past three months.
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