Abano dentists increase revenue almost 50pc

Dentists working in practices owned by listed healthcare investor and operator Abano Healthcare increased revenue by almost 50 per cent to more than $1800 a day in the past year.

An investor presentation Abano is due to make today at Forsyth Barr in Auckland shows the dentists, who had a daily revenue of $1300 in 2003, were now bringing in $1863 a day.

Abano owns the largest dental group in the country, with 20 practices running under two banners: Lumino Dental Care, formerly Geddes Dental, and the Auckland Dental Group.

It said the group of dental practices was expanding at the rate of one new clinic every two months and employed 60 clinicians - dentists and oral hygienists - and 164 staff.

More dental practice acquisitions are planned and Abano expects to have 40 dental businesses by 2009.

The presentation by chief executive Alan Clarke showed dentists had transformed their businesses in the past year.

Abano introduced its prime practice management scheme to the two dental groups late last year, pushing up daily dental billings 43 per cent.

"The dentists went from working at the lower end with a lot of A&E and drill-and-fill business to transfer their practices to a complete oral healthcare service," Clarke said yesterday.

The dental businesses make 92 per cent of their revenue from private practice and the rest from the Ministry of Health via a schools mobile bus contract. In 2004, 78 per cent of revenue came from the private sector but the dentists were encouraged to increase this sector of their market.

Clarke is predicting a squeeze in the health sector as state funding declines and demand for private care rises.

"The Government will have to stop the process of constant health reform and cost reduction and selectively target its expenditure to those who cannot afford to pay," he said in his presentation.

"Demand for all private services will grow as the public sector becomes unable to meet the demand. Private funding and payment for healthcare services will increase."

Shares in Abano closed 6c up yesterday at $1.27.