One of the safest businesses in Lithuania – Dental Services
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 (email@example.com)