This week has seen publication of the latest results from the NASDAL (National Association of
Specialist Dental Accountants and Lawyers) Goodwill Survey statistics. This survey covers the quarter
ending 31st October 2021 and includes data on valuations as well as deals completed (i.e., practices
bought or sold by NASDAL members’ clients in the period).
The quarter saw a varied picture for NHS, Private and Mixed practices. Overall, there was a small
increase in goodwill as a percentage of fee income in the quarter across all types of practice – deals
averaged 152% of gross fees – up from 144% in the quarter to 31st July 2021.
The big increase in values was for mixed practices which saw practice goodwill at 179% of gross fees
– a big jump from 145% in the last quarter. Private practice goodwill values stayed steady at 132% of
gross fees (133% in the previous quarter).
However, NHS practices saw a big drop in goodwill values to 138% of gross fees – down from 161%
in the quarter to 31 st July 2021.
NHS Practices – no longer the ‘safe’ option?
Alan Suggett, specialist dental accountant and partner in UNW LLP who compiles the goodwill
survey, commented, “These results may come as a surprise to some coming as they do, in the
uncertainty of a worldwide pandemic. It may also be the case that the pandemic is causing deals to
take longer to get done than they usually do and this is skewing the figures in this quarter.
“It could be that this is the beginning of a trend as dentists turn their back on NHS practices due to
uncertainty around their value in years to come – only time will tell. Their guaranteed income at this
time still makes them an attractive investment to some buyers. NASDAL colleagues are still reporting
that the practice sales market is robust and that sale prices are not being reduced and are reaching
their full potential.”
NASDAL member Johnny Minford of Minford Specialist Dental Accountants, observed, “Anecdotally,
I’m seeing a lot less interest in buying primarily NHS practices because the uncertainty of required
achievement has increased negative attitudes and pulled down prices (rightly or wrongly).
“On the other hand, mixed practices could be seen as the best of both worlds – clinical staff can
move to work on private treatment with broader freedoms, or push to achieve the NHS targets and
keep the steady monthly income coming in at different times of the year as necessary.”
The goodwill figures are collated from accountant and lawyer members of NASDAL in order to give a
useful guide to the practice sales market. These figures relate to the quarter ending 31st October
2021.
NASDAL reminds all that as with any averages, these statistics should be treated as a guideline only.
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