The profitability of some companies is almost half their revenues, very few go bankrupt.
Vilnius, Lithuania 06/02/2023. Although most dental businesses are small and usually employ fewer than 10 people, this is one of the most stable businesses in Lithuania. Profitability often exceeds one-third of income and only a few become insolvent. Dental businesses are 7 times less likely to go bankrupt than the average insolvency across all other businesses, according to an analysis conducted by Creditinfo Lithuania.
According to data from January 2023, there are currently almost 2,000 dental businesses in Lithuania employing 9,500 people. The number of companies and their employees is growing year on year. Dental businesses are generally small, with more than half of them employing fewer than 10 people. Only 12 organisations have created more than 50 jobs, while the largest dental service companies are Vilnius University Hospital (293), SB Dental Clinic (168), Denticija (153), Smile Academy (126), Smile Laboratory (124), Vilnius Implantology Centre Clinic (93), Panevėžys City Dental Clinic (72), Laudenta (71), Pasirink (66) and Žvėrynas Dental Clinic (59).
Revenues grow year on year, profitability remains high
Despite the pandemic’s restrictions on the medical services sector between 2020 and 2021, the total revenue of dental companies has grown consistently year on year, reaching €294.6 million in 2021, an increase of 39.8% compared to 2020 (€210.7 million), which in turn is an increase of 76% compared to 2019 (€167 million).
The top 10 companies with the most revenue in 2021 are SB Dental Clinic (€8.2 million), Vilnius Implantology Centre Clinic (~€7 million), Denticija (€3.2 million), Smile Academy (€3.1 million), Prodenta (€3.1 million), Žvėrynas Dental Clinic (€3 million), Sveikatos Gija (€2.9 million), Šiauliai Implantology Centre (€2.8 million), Laudenta (€2.6 million) and Dental Harmony (€2.6 million).
Dental service companies are characterised by relatively high profitability, reaching up to 45%. The top ten companies with the highest profits in 2021 are Laudenta (€922 thousand), SB Dental Clinic (€917 thousand), Implantera (€739 thousand), Šiauliai Implantology Centre (€713 thousand), Smile Design (€688 thousand), Vilnius Implantology Centre Clinic (€644 thousand), Klaipėda Orthodontics Centre (€592 thousand), Dantima (€556 thousand), Donatas Jurgaicis Odontology Clinic (€529 thousand) and Teeth Centre (€512 thousand).
“The dental services business has advantages – patients usually pay for services immediately, which speeds up the turnover of funds. In addition, some dental services are subject to significant VAT exemptions, which reduces the tax burden and increases the profitability of the companies,” says Jekaterina Rojaka, Head of Business Development and Strategy at Creditinfo Lithuania.
However, not all companies were profitable, with 148 dental service providers declaring a loss in 2021, compared to 128 in pandemic year 2020 and 133 in pre-pandemic year 2019.
Dentists 7 times less likely to go bankrupt
The dental services sector has a particularly low risk of bankruptcy compared to all other sectors, with 1% of firms currently at high risk of bankruptcy and 0% at the highest risk. The high and highest risk classes for late payment are 3% and 2% of companies, respectively. The riskiness of dental firms was slightly higher at the beginning of 2021, with 4% of firms in the high bankruptcy risk class (none in the highest) and 11% in the high and highest delayed payment risk classes.
No dental companies went bankrupt in 2021 or 2022, while 26 firms have become insolvent since 2003, an average of 1-2 per year.
The dental business is characterised by a low level of debt. As of January 2023, there were 98 registered debts in the credit bureau’s system, totalling €95 thousand. The average debt was €971.
Compared to companies operating in other sectors in Lithuania, dental service companies are 7 times less risky. For example, in January this year, 1.3% of dental businesses were classified as high and highest risk, compared to an average of 9.5% for all other businesses in Lithuania. In terms of the risk of late payment, 4.5% of firms were in the high and highest risk classes, while the average for all other firms was 17.2%.
Almost a fifth of dental businesses (359) have not yet submitted their financial statements for 2021.
Jekaterina Rojaka, Head of Business Development and Strategy, Creditinfo Lithuania (firstname.lastname@example.org)
Revenues doubled in a year but remained three times lower than before the pandemic.
Vilnius, Lithuania, 24/01/2023. Travel agencies in Lithuania that declared their income in 2021 earned almost twice as much as in the previous year. However, compared to income in 2019, they earned almost three times less, according to an analysis carried out by the credit bureau Creditinfo Lietuva. Almost 100 tourism companies were loss-making. With the increase in travel flows, the number of debts increases and their average size grows.
There are currently 783 companies in Lithuania for which tour organisation is the main activity. In 2021, travel agencies declaring revenues collectively earned more than €171 million, almost double (82%) the pandemic year 2020 (~€94 million). However, travel agencies are still a long way from a real recovery – for example, in 2019, their revenues were almost €474 million, but fell more than fivefold in the aftermath of the pandemic.
According to 2021 data, the largest annual revenue was earned by the following companies: Novaturas (€108,995 million), Tez Tour (~€60 million), Itaka Lietuva (€12.5 million), Coral Travel Lithuania (€9.5 million), Kidy Tour (€8.9 million), Estravel Vilnius (€6.3 million), Estekspress (€4 million), Traveldeals LT (€4 million), Glotera (€3.6 million) and ZIP Travel (€2.9 million).
The top ten most profitable travel agencies are Novaturas (€909 thousand), Baltic Tours Group (€633 thousand), Vestekspress (€530 thousand), Glotera (€336 thousand), Traveldeals LT (€307 thousand), Baltic Clipper (€288 thousand), Baltic Travel Service (€271 thousand), TEZ Tour (€215 thousand), Estravel Vilnius (€158 thousand), Riviera Tours (€148 thousand) and ZIP Travel (€123 thousand).
Staff numbers shrink by a quarter
In total, travel agencies currently employ almost 2,000 employees (1,850). While the number of enterprises has remained almost constant over the past few years (776 in 2019, 787 in 2021), the number of employees has fallen by almost a quarter since 2019, from 2,426 to 1,850.
Travel agencies are more often headed by women, accounting for almost 56% of all managers. The average age of a travel agency manager is 49 years and the average age of a travel agency is over 15 years.
In the travel sector, men’s salaries are higher than women’s – as of November 2022, the average salary for men was €2,659 per month, while for women it was €2,014 per month. At the start of 2022, the average salary for women was €2,053 per month and for men was €2,364 per month.
State support has prevented more bankruptcies
Since 2004, a total of 94 travel agencies have gone bankrupt in Lithuania, with the highest number of bankruptcies recorded in 2009 (10) and in 2015 (12). In 2022, there were 5 travel agency bankruptcies, while there were 3 in 2021 and 4 in 2019. No travel agency bankruptcy was recorded in pandemic year 2020.
“The travel sector was one of the hardest hit by the pandemic, along with hotels and restaurants. During the pandemic, when revenues from tour operators dropped fivefold, it was state support that saved the sector from bankruptcy,” explains Aurimas Kačinskas. But the challenges of the pandemic were replaced last year by new challenges – the war in Ukraine and the sanctions imposed on Russia have exacerbated the energy crisis, fuel prices have risen and many travel routes have been disrupted. The slower-than-expected recovery of the air transport sector, with a sharp increase in fares, is having a negative impact on the business of tour operators, preventing them from recovering faster.
According to the head of the credit bureau, it was state support that determined the stability of the number of enterprises and the discipline of submitting financial statements – compared to other sectors, only 90 travel agencies did not submit their financial statements for 2021, making them ineligible for state support.
However, a risk analysis of travel agencies shows that there have been both positive and worrying signs in the recent period. For example, as of January this year, 9% of companies were in the high and highest classes of bankruptcy, compared with 12% a year ago. In terms of delayed payments, 17% of companies are currently in the high and highest risk classes, down from 21% last year.
Compared to 2020 and 2021, the recent increase in debt is slightly higher and the average amount of debt per person is growing. At present, 306 debts have been registered in the credit bureau system, amounting to more than €349 thousand, with an average debt of €1,141. A year ago, the number of debts was 316, amounting to €351 thousand, with an average debt of €1,112. In January 2020, 255 debts amounting to €203 thousand were registered, with an average debt of €798. 335 travel agencies mostly owe money to Sodra (€3 million). The debt of 158 travel agencies to telecommunications companies amounts to €222 thousand. 8 travel agencies owe €74 thousand to financial companies.
“The tour operator business is recovering, but revenue growth is slower than expected in the wake of the pandemic due to the many geopolitical and economic shocks around the world. The tourism sector is currently encompassed by a number of risks, so it is advisable to keep a close eye on the changing financial indicators of partners organising the trips,” concludes the head of the credit bureau.
Aurimas Kačinskas, CEO of Creditinfo Lithuania (email@example.com)
Ms. Ege Metsandi, CEO and Chairman of the Management Board for Creditinfo Estonia is leaving her position at the company. During the next 6 months, Ms. Metsandi will be working closely with the interim Chairman and CEO, Mr. Elari Tammenurm, currently the Head of IT – Baltics, along with the Estonian team to ensure a seamless handover continues until a replacement is found.
Paul Randall, Group CEO for Creditinfo, advised, “During her 6 years of tenure, Ege has successfully developed the company, both financially and commercially. I want to personally thank Ege for her efforts, utilizing her experience and great insight in risk management to build the Creditinfo brand in Estonia.
Everyone at Creditinfo wishes Ege well for her future.” Ege added, “I leave a very strong and talented team behind at Creditinfo. I look forward to making certain of a smooth transition to keep up the positive momentum that we have established together over the last 6 years.” Established in 1997, Creditinfo Group provides credit information and automated risk management services around the world.