1st Dental takes bigger bite

1st Dental takes bigger bite
10 March 2005
Eric Barkas, City Editor
Yorkshire Post Today
SMILE and show your best asset.
There's no part of the body that can't be improved these days by medical or surgical intervention. Teeth are no exception.
What's driving the dental market is awareness on the part of customers of what can be achieved.
"The patient is becoming more and more aware that you don't have to have crooked or yellow teeth," says Andrew Garner, chairman of 1st Dental Laboratories.
That means more demand on dentists ÇƒÏ particularly in private practice. Yes, NHS dentists can be hard to find in some areas of the country. But go private and there's no shortage of practitioners keen to take your hand off as well as your teeth out.
The dental and oral hygiene market has flourished in recent years as people spend more on their smile. Twelve years ago it was worth ¨£181m. Today the figure is ¨£4bn, of which half is private.
Harrogate-based 1st Dental spotted the trend and moved in by buying up dental labs that provide surgeries with custom-made implants like crowns.
From three labs in 2000 it has grown to 15. Its most recent acquisition in December was that of its leading competitor Benchmark, increasing its labs by 50 per cent.
1st Dental has taken the lead in consolidation of the lab market. It is now the biggest in its field.
The strategy is to buy labs, use them as a platform to sell other products and services to dentists ÇƒÏ such as bridges, braces and false teeth ÇƒÏ improve efficiency and gain benefits from scale and buying power.
The company has built an infrastructure capable of supporting ¨£20m of turnover a year. It was envisaged that once it achieved critical mass, profits would drop straight through to the bottom line.
That target appeared yesterday to have been met when 1st Dental reported its first profit ÇƒÏ ¨£108,992 pre-tax in the year to November 30 compared with losses last time of ¨£295,288. Turnover was up 37 per cent at ¨£5.8m, thanks partly to three acquisitions in the year. Mr Garner says Benchmark will help raise turnover to ¨£14m in the current year, when profits are expected to be more than ¨£1m.
Consolidation has to happen in dental labs. Ten years ago a dental technician could set up a lab with ¨£10,000. Now it would take more than ¨£100,000.
Dentists have become more demanding and the treatments they offer more varied and complex.
1st Dental has a ¨£5m banking facility to help fund more acquisitions. It says it has received approaches or is in talks with some 30 potential acquisition targets.