NASDAL Goodwill Survey – further NHS practice woes
NewsPosted by: Dental Design 23rd November 2022
This week sees the latest results from the NASDAL (National Association of Specialist Dental Accountants and Lawyers) Goodwill Survey statistics. This survey covers the quarter ending 31st July 2022 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 mixed bag – goodwill down for NHS and mixed practices, but a slight increase for private practices. Overall, there was a decrease in goodwill as a percentage of fee income in the quarter across all types of practice – deals averaged 135% of gross fees – down from 143% in the quarter to 30th April 2022.
NHS practices fell back to 132% goodwill as a percentage of fee income in the quarter – a big drop from 178% of gross fees in the previous quarter. Mixed practice goodwill values were also on the slide as they dropped to 119% of gross fees (132% in the previous quarter). Private practices saw a small increase with goodwill at 140% of gross fees – up from 124% in the last quarter.
NHS Practices less attractive?
Mike Blenkharn, Head of Dental at UNW LLP who compiles the goodwill survey, said, “In my view, this quarter is more indicative than the previous one. I feel that NHS practices are less attractive than they were twelve months for a number of reasons – recruitment of staff being one of the major ones. The right mixed practice can offer the benefits of both private and NHS.”
Johnny Minford
Johnny Minford, Principal of Minford Chartered Accountants and NASDAL Media Officer added, “I think that the market will stabilise over the next twelve months. With a coming recession and lower consumer confidence, the NHS could be perceived as a safe haven. The value of a steady income is starting to be seen in the Goodwill Survey results, with mixed practices showing higher values than predominately private. NHSBSA are taking a hard line on clawback and abatement, so conversely this could lead to more NHS practices on the market.”
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 July 2022.
NASDAL reminds all that as with any averages, these statistics should be treated as a guideline only.
