1300SMILES: Our Fifth Year as an ASX-Listed Company

By Dr Daryl Holmes, Managing Director, 1300SMILES Ltd

In August 2009 1300SMILES Ltd (ASX : ONT : ‘Smiles’ in the newspaper) delivered its fifth Annual Report to Shareholders since listing on the Australian Stock Exchange.

The financial results for the year were outstanding, with profit after tax up 74%, earnings per share up 72% and a full year dividend up 34%. In the four years since 2005, the dividend has tripled from 3.8c/share to 11.4c/share, fully franked.

That's great news for shareholders, especially in a year in which many big companies—including all of the big banks—cut their dividend payouts sharply.

Are these great results for shareholders also good news for our dentists? I think so.

Remember that dentists who choose to practise in a 1300SMILES facility don't have to own any shares in the company. They're free to buy some on-market if they wish, but whether they own shares or not has no effect whatever on their professional relationship with 1300SMILES.

Choosing to locate your practice within 1300SMILES is a big decision. We think you should take considerable comfort from our financial success. Our company is stable and has delivered growing profits over many years. We have very little debt for a company our size. Our practices and equipment are maintained in top condition, in sharp contrast to a lot of the tired-looking small practices I've visited.

We're aware that there are other companies which may offer to buy your practice. They may well offer you some shares in a company which is not yet listed. These shares have no practical value. Just ask yourself: to whom could I sell these shares and for how much? You should also look into the accounts of these companies. You may well find that they have been built on mountains of debt—not the sort of structure you want to bet your practice on.

One aspect of our financial success may shed some light on your career. I've observed that some dentists can be a bit unimaginative when it come to locating their practices. Most still seem to cluster in the capital cities. Our experience suggests that this is not the best choice. We've found that many regional centres offer far better business conditions for dentists than the big cities.

Mackay is a good example. We had no presence there just a few years ago. We opened a four-chair facility and found that all of our dentists were booked to capacity almost immediately. So we more than doubled the size of the facility and every new dentist we have accommodated has a full schedule every week.

If you're willing to think freely, you might realise that the regional centres have a lot of advantages. Consider walking to work or a very short commute, cheaper housing, and all the benefits of a coastal lifestyle—all while earning as much or more than you would in the big smoke. Admit it, you've daydreamed about shifting to Cairns, Bundaberg, the Sunshine Coast, or Gold Coast, haven't you? What about Townsville, with the fastest growing economy in Australia? Consider Gladstone, Rockhampton, or Toowooomba, places where your kids can grow up with some space and some freedom.

And don't forget that when you join 1300 SMILES you benefit from an established brand with excellent marketing. Most dentists who join us find that they're booked out from the second week onward. That's hardly the experience you'll have signing on as the new associate in a small practice, as there aren't many of these that have work for an extra whole dentist.

Speaking of lifestyle, maybe your ideal setting would enable you to work on a schedule which truly suits you. Maybe during school hours only, maybe four long days with three days off every week, maybe nine months a year, allowing you to let your other big interest really power ahead? You should talk to us about how we can help you achieve the professional and personal life you really want. Only a company with our scale, geographical reach, and stability is flexible and reliable enough to offer you these opportunities.

Buy some shares in 1300SMILES Ltd? That's up to you. Most shareholders I speak to are pretty happy.

PS. For more information, please call Tom Fraser or Debbie Oaks on +61 7 4721 1238, or visit Dental Careers Australia.