Turnstone returns a profit post merger

Turnstone Equityco 1 Ltd, the market leading provider of NHS and private dental services in the UK, has filed its first accounts for the period 18 January 2011 to 31 March 2012 Turnstone Equity is the holding company for the merged Integrated Dental Holdings (IDH)/Associated Dental Practices (ADP) dentistry business, acquired by the US based private equity company The Carlyle Group in May 2011. As such the accounts which reflect 11 months of trading have no comparatives from the previous year. Turnover was £309.9m but with cost of sales of £164.2m, admin expenses of £140.1m and loss on disposal of assets of £3.5m (five practices following and Office of Fair Trading review of the acquisitions of IDH and ADP), profit before interest and tax was £3.8m (including £1.8m of other operating income’). However adding together IDH and ADP the group seems to have increased its EBITDA from £44.4m in the full year to March 2011 to £52m (excluding £7.7m of exceptional integration costs) for 11 months to March 2012. Philip Blackburn, consultant at Laing & Buisson said: The IDH Group’s underlying operating performance was solid following its expansion, as its dominant NHS business delivered stable and reliable returns. Bottom line profits, however, were absorbed by interest on high levels of acquisitive debt. As the group is currently heavily dependent on NHS revenues, some 88% of all business, a tight fiscal environment for public healthcare, and the introduction of new NHS dentistry contracts going forward, which focus on outcomes rather than agreed volumes, mean the group may face less predictable conditions going forward.’