Random CC notes: This will be a little disjointed because there is no pause button on the CC.
Reducing costs - Moving many operations to China.
Changing name to GlamSmile Inc soon because it better reflects current company.
Aim to open 20 GlamSmile studios in China by 2013.
Last q results of $850,000 profit after tax from two Glamsmile studios in Hong Kong and Beijing. They DO NOT include anything from Shanghai. Shanghai predicted to be the most successful GlamSmile studio.
Another studio to be opened within 2 months.
There is an additional 500k of revenue not recognized this quarter.
No competition in Asia. Margins much much higher.
3 million revenue from last year of Beijing plus Hong Kong.
Results from quarter now [not reported yet] increasing sales at each studio. i.e, individual studios more popular.
Potentially 150 - 200 placements per month.
1st 2 weeks of July best ever.
Wenzhou wealthy city, studio opening in couple of months.
Guangzhou opening maybe beginning of 2012.
Currently 20-23 patients per month per studio.
2014 end calendar day 20 studios end calendar year 10 owned
10 franchised
EBITDA 40% margin Guidance based on this 2013 march 30 million sales revenue. EBITDA 18 million US dollars
B2B model low profits. However, still worth pursuing using Denmat.
Management is straightforward and honest.
Management will not dilute stockholders [and himself].
Financing is slowing them down right now.
Therefore, company will restructure to better take opportunities. Shedding some divisions - did not say what. Most senior management has taken a pay cut. Job cuts in Europe to relocate to Asia.
An IR firm is going to be engaged - this company is focused on Asian firms.
Questions:
First Fit royalties still expected. Product will be launched November 2011. Still expecting 1 million from them. Then 5% of revenues as royalties.
2% royalty from DenMat veneers. Product itself is better.
Studio openings in Europe slowed - Brussels open by 20th Sept. Italy later.
Owned - own 51%
Licensed keep 51% [discounted veneers]
Franchised up front fee and higher amount per veneer.
Fully capacity 100-150 patients per month.
Average now 20 patients per month.
Looking at superior business models - Groupon like promotions in China. China marketing in high-end magazines. Trying to limit amount of phone calls. Not advertising online because too many people could not afford it. In Hong Kong mid-stream services.
In the depths of humility lies greatness.
