Thanks for sharing. I did not know there is a gem in my backyard, haha.
I am reading through the financial statements and in your write up you said the acquisitions were done at 4-6x EBITDA. Can you point me to the right direction as to where to value those deals?
A good friend of mine is an accountant here in Finland and he charges a lot for his service. AAlloon paid a lot for those tiny practices (100-200K per person). I don't doubt the valuation here, but from the experience of looking at dental practices consolidator, I wonder what kind of relationship Aalloon has with those entrepreneurs. It looks good on paper, but those revenue streams could be gone in a few years.
Aalloon issues quite a few shares in the acquisitions so IFRS transition is obviously to boost the stock price.
https://aallongroup.fi/tiedotteet/ will get you to their annoncements, which can be translated if needed. Not all deals show full disclosure, but after perusing a good amount of them I reached the conclusion. I have not gone into much greater detail as to their potential retention of clientele post deal so I can't necessarily answer your question.
Aallon does not issue many shares, it is miniscule relative to cash, dilution is low single digits p.a. since their listing to i'd hardly call it 'quite a few'. The IFRS transition will much more materially impact the amortisation of goodwill, or rather basically remove it, pushing up statutory profits meaningfully.
Aallon released a notification yesterday that they are changing to an IFRS-accounting starting next year. I believe the change will highlight better their underlying profitability? (Amotization of acquisitions.) Furthermore, it enables them to access main listing on the Helsinki Stock Exchange.
I think you are right in that there profitability should improve due to IFRS adoption. Under IFRS it’s not typical to amortise goodwill at all, instead there is an allotment allowed for “customer assets” which is a bit of a generalised amount, but it won’t be the entirety of goodwill so it should reduce as a % of costs
Thanks for sharing. I did not know there is a gem in my backyard, haha.
I am reading through the financial statements and in your write up you said the acquisitions were done at 4-6x EBITDA. Can you point me to the right direction as to where to value those deals?
A good friend of mine is an accountant here in Finland and he charges a lot for his service. AAlloon paid a lot for those tiny practices (100-200K per person). I don't doubt the valuation here, but from the experience of looking at dental practices consolidator, I wonder what kind of relationship Aalloon has with those entrepreneurs. It looks good on paper, but those revenue streams could be gone in a few years.
Aalloon issues quite a few shares in the acquisitions so IFRS transition is obviously to boost the stock price.
Hi Fan,
https://aallongroup.fi/tiedotteet/ will get you to their annoncements, which can be translated if needed. Not all deals show full disclosure, but after perusing a good amount of them I reached the conclusion. I have not gone into much greater detail as to their potential retention of clientele post deal so I can't necessarily answer your question.
Aallon does not issue many shares, it is miniscule relative to cash, dilution is low single digits p.a. since their listing to i'd hardly call it 'quite a few'. The IFRS transition will much more materially impact the amortisation of goodwill, or rather basically remove it, pushing up statutory profits meaningfully.
Thanks a lot. Talenom took off when it transitioned into IFRS in 2019. I hope not a coincidence.
Aallon released a notification yesterday that they are changing to an IFRS-accounting starting next year. I believe the change will highlight better their underlying profitability? (Amotization of acquisitions.) Furthermore, it enables them to access main listing on the Helsinki Stock Exchange.
I think you are right in that there profitability should improve due to IFRS adoption. Under IFRS it’s not typical to amortise goodwill at all, instead there is an allotment allowed for “customer assets” which is a bit of a generalised amount, but it won’t be the entirety of goodwill so it should reduce as a % of costs