Dentalum Operations AB (publ) Interim report second quarter and January-June 2023

Second quarter April-June 2023

• Capital structure was strengthened by a shareholders’ contribution in the amount of SEK 141 million following a share issue of 153 million in Dentalum Group AB.
• Reported net revenue in the second quarter was to SEK 125.2 million (105.4) and total revenues SEK 126.5 million (105.7).
• The increase in quarterly revenue compared to the same quarter prior year, was driven by acquisitions of seven dental clinics, acquired since the same quarter in 2022, albeit some clinics faced a general decline in revenues.
• Consolidated EBITDA was SEK 20.3 million (24.4) of which SEK 29.8 million (31.2) was generated in the dental clinics and SEK -9.5 million (-6.9) of net expenses in the Parent company, Dentalum Operations AB (publ). 
• Consolidated operating profit margin, IFRS adjusted EBITDA as a percentage of total revenue, for the second quarter was 16.1% (23.2%). Excluding the Parent company expenses, the adj. EBITDA margin in Q2 was 23.6% (29.5%). 
• Net financial items amounted to SEK -1.6 million (-8.7), including revaluation of contingent purchase price considerations of SEK 7.6 million (-0.1) and interest expense, incl. financing fees, of SEK -9.2 million (-8.6).
• Group net earnings amounted to SEK 4.8 million (4.8).
• Consolidated cash flows from operations, including paid tax, amounted to SEK 11.1 million (25.3).
• Net cash flow after investing and financing activities, was SEK 125.5 million (-46.7). 
• As per June 30, 2023, following the shareholder´s contribution, total equity amounted to SEK 372.4 million (263.0), cash balance was SEK 229.1 million (198.6) and interest-bearing debt of SEK 399.3 million (397.6), consisting of bond debt of SEK 400 million, adjusted for amortized financing costs.

First six months January - June 2023

• Reported net revenue in the first six months reached SEK 244.5 million (189.8) and total revenues SEK 247.6 million (191.5).
• Consolidated EBITDA, adj. for IFRS adjustments of 11.3 million (6.6), reached SEK 42.7 million (45.5), of which SEK 61.3 million (57.9) was generated in the dental clinics and SEK -18.6 million (-12.4) of net expenses in the Parent company, Dentalum Operations AB (publ). 
• Consolidated operating profit margin, IFRS adjusted EBITDA as a percentage of total revenue, for the first six months was to 17.3% (23.8%). Excluding the Parent company expenses, the adj. EBITDA margin in the first six months was 24.7% (30.3%). 
• Net financial items amounted to SEK 2.9 million (-17.3), including revaluation of contingent purchase price considerations of SEK 21.0 million (-0.1) and interest expense, incl. financing fees, of SEK -18.0 million (-17.2).
• Group net earnings amounted to SEK 18.1 million (8.2).
• Consolidated cash flows from operations, including paid tax, amounted to SEK 20.9 million (29.3).
• Net cash flow after investing and financing activities, was SEK 112.7 million (-72.2). 

Significant events

During the second quarter

Dentalum Group AB successfully executed a share issue of SEK 153 million, of which SEK 141 million was down streamed to Dentalum Operations AB (publ) by a shareholder´s contribution to facilitate refinancing of the Senior bond, maturing on October 2, 2023, and to enable further organic growth opportunities while selectively exploring inorganic growth prospects.

Significant events after the second quarter 2023

Management and the Board of Directors have, following the capital strengthening described above, continued its process to refinance the Company´s bond. As a result, the Company has reached advanced discussions with banks and an agreement is expected to be signed before the maturity of the Bond. In parallel, a possibility to extend instead of refinancing the Bond, is being assessed, should an agreement for bank financing not materialize within the coming weeks. Should none of the alternatives be available at the time of maturity of the Bond, the Company would not be expected to meet its obligations to its bond holders.

The Board of Directors and Management are however positive regarding the Company´s ability to complete refinancing or alternatively an extension of the Bond.

For further information, please contact:

Max Dorthé Ladow, CEO and co-founder, +46 709 85 97 83, max.ladow@dentalum.com 
Sofi Eriksson, Executive advisor and acting CFO, +46 705 95 46 33, sofi.eriksson@dentalum.com 

For more information, please visit www.dentalum.com

Dentalum Operations AB (publ) is a fast-growing dental service organisation focusing on acquiring profitable and sustainable dental clinics in the Nordics. Dentalum’s philosophy is built on local heritage, where the clinic owners continue as entrepreneurs operating the clinics with a high degree of independence post-acquisition. Dentalum’s goal is to build a world class organisation by creating a strong corporate culture, positive work environment and growth opportunities which motivate and engage our coworkers to provide the highest quality of care and a remarkable service to our patients. For more information, please visit www.dentalum.com

This information is information that Dentalum Operations AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation and the Swedish Securities Markets Act. The information was submitted for publication, through the agency of the contact persons set out above, on August 31, 2023, at 22.15 CEST.