Poor Christmas trading grinds down Smiles Inclusive results

Poor Christmas trading grinds down Smiles Inclusive results

Gold Coast-based dental practice aggregator Smiles Inclusive (ASX: SIL) has seen an increase in cash inflows for the second quarter, but profitability was drilled down by acquisition spending. 

Cash inflows rose 9 per cent on the previous quarter to reach $12.7 million, but this was still $500,000 short of expectations as a result of lower than expected trading over the Christmas-New Year period.

In a quarterly report released today, the group reported cash outflows of $13.5 million, with significant items including stamp duty costs associated with the initial portfolio acquisition, costs from acquiring three Gold Coast practices as noted at the AGM in November and a further dentistry practices acquired in December.

Smiles' shares have lost more than 70 per cent of their value since the company's initial public offering (IPO) on the ASX in April last year, and the group now has cash reserves of just $1 million as well as around $200,000 on deposit.

However, an available undrawn debt capacity of $17.8 million under its working capital and acquisition facilities may help the practices escape its dental doldrums. 

In the update today, managing director Mike Timoney said organic growth initiatives outlined at the AGM were achieving traction. These included an increase in the utilisation of acquired chairs, a reactivation of existing patients for new check-ups, improving recall effectiveness, the activation of alternate payment channels, in-house referrals and online campaigns.

"We have also identified further operational improvements to undertake which, together with the progress achieved during the quarter, mean we are well-positioned to achieve our 2019 goals," Timoney said.

Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.

Business News Australia

Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

Looking for a credit or charge card that’s built for your business? Try American Express
Partner Content
A good credit card should work for you, not against you, and let you and your business ...
American Express
Advertisement

Related Stories

Mandatory COVID isolation to end nationally mid-October

Mandatory COVID isolation to end nationally mid-October

National Cabinet has today determined that mandatory isolation peri...

Bottoms up: Sydney cold brew coffee liqueur brand Mr Black acquired by beverage giant Diageo

Bottoms up: Sydney cold brew coffee liqueur brand Mr Black acquired by beverage giant Diageo

Fast-growing coffee liqueur brand Mr Black is joining a portfo...

Sunset on the horizon in 2023 for developer Sunland

Sunset on the horizon in 2023 for developer Sunland

A developer behind some of the Gold Coast's most iconic buildin...

Study finds cybersecurity skills gaps on boards as Optus debacle rolls on

Study finds cybersecurity skills gaps on boards as Optus debacle rolls on

As the backlash continues over a data breach at Optus that has pote...