Silk Laser released their FY22 results.

Key FY22 highlights (vs FY21):

• Network cash sales up 91% to $162.7 million
• Reported revenue up 38% to $81.3 million
• Adjusted EBITDA up 27% to $22.0 million
• Statutory NPAT up 24% to $6.4 million
• Adjusted NPAT up 27% to $9.6 million
• 127 SILK clinics across network at 31 July 2022 (up from 61 at 30 June 2021)
• Strong balance sheet with cash of $18.6 million, and net debt of $3.8 million

Trading update

SILK expects to continue its growth trajectory in FY23.

Service mix continues to skew further to Injectables, which is proving to be the strongest and most resilient service category.

Strategic price increases, to mitigate cost inflation, were successfully actioned across Injectables and Skincare from 1 July 2022, with no reduction in transaction volume recorded.

I don't hold SILK but its one I'm watching.

Current market cap is $144m

Gross margin is 47% and net profit margin is 11%.

FY22 Revenue $81.3m / Earnings $9.6m

The translate to PS of 1.8x and PE of 15x

As mentioned, the company grew revenue at 38% and earnings at 25%

If they continue to grow at similar rates the current valuation is pretty reasonable.

Risk: One big risk is less consumer spending due to recessionary environment.

Silk Laser has recently provide Q322 results.

Year-to-date Q3 FY22 highlights (vs YTD Q3 FY21):

● Network cash sales up 91% to $116.6 million, including 7 months of ASC/TCC1

● Like-for-like cash sales, adjusted for lost trading days due to COVID lockdowns, up 4%

● Injectables category continues to show its resilience and underpin repeat revenue growth, now

comprising 45% of network cash sales

● Received 5-star franchise rating on the Australian Franchise Rating Scale, the only franchisor

in personal health and beauty to achieve this rating

● Expects to deliver FY22 EBITDA2 of at least $20 million

This company provides is one of Australia and New Zealand’s largest specialist non-surgical aesthetics clinics.

They provide laser hear removal, cosmetic injections and other skin treatments.

45% of their revenue come from Injectable services which is a growing industy.

The Injectables category generates higher transaction values, higher margins.

This is not a company I own, but it is one I'm watching.

What I like is the reoccurring nature of the business where clients regularly revisit the clinics to keep up with their beauty needs.

Market cap is $143m with $68m revenue for FY21 (and around $77m expected for FY22)

Foretasted FY22 EBITDA2 of at least $20 million ( compared to $17.3 million last year)

The CEO also owns 5% of the company.