SILK Laser share price surges as FY22 earnings beat guidance

The company doubled its network of clinics in FY22.

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Key points

  • The SILK Laser share price is lifting 4% on Tuesday after the company released its financial year 2022 earnings 
  • It posted a 91% increase in network cash sales and a 27% jump in adjusted EBITDA 
  • The company also grew its clinic count by 66 to 127 last financial year 

The SILK Laser Australia Ltd (ASX: SLA) share price is soaring after the company posted its earnings for financial year 2022 (FY22).

The stock opened 3% higher at $2.68 before surging higher.

At the time of writing, the SILK Laser share price is $2.71, 4.23% higher than its previous close.

SILK Laser share price gains as revenue lifts 38%

Here are the key takeaways from the specialist non-surgical aesthetics clinic networks' FY22 earnings:

SILK Laser beat its initial public offering (IPO) EBITDA guidance by 10% in FY22.

The company's cash sales surged 91% last financial year. Though, its like-for-like sales remained flat, maintaining the 52% growth in like-for-like sales achieved the prior year.

The company's client base grew to 1.4 million customers in FY22, with most booking multiple treatments per appointment. Average customer spend was $661. Its own skincare brands also continued to expand online sales.

SILK Laser closed FY22 with $18.6 million of cash and net debt of $3.8 million.

What else happened in FY22?

The company acquired Australian Skin Clinics and The Cosmetic Clinic in September for $47 million. The businesses' initial integration has now been completed.

Last financial year also marked the first full fiscal year in which the company operated as a listed entity, having floated on the ASX in December 2020. SILK Laser shares are currently trading for 21% less than their IPO offer price of $3.45.

What did management say?

SILK Laser co-founder and managing director Martin Perelman commented on the company's earnings, saying:

After operating in challenging market conditions this past year, I'm so proud at how hard the SILK team has worked to deliver these robust financial results.

We continue to execute against SILK's growth strategy outlined at the time of our IPO, beating EBITDA guidance by 10% while diversifying our service mix with Injectables and Body proving to be our key growth drivers.

What's next?

The company hasn't provided any new earnings guidance today. Though, it did post a trading update.

Over the period between 1 July and 28 August, its like-for-like sales grew 5% on that of the pcp, with service mix continuing to skew towards injectables. It also implemented strategic price increases to mitigate the cost of inflation with no reduction in transaction volume recorded.

The company's growth strategy remains in line with its IPO plan which is expected to see it boasting 150 clinics. It's also evaluating organic growth and merger and acquisition opportunities, including clinic buybacks.

Finally, its investing in upgraded corporate systems, with a total estimated project spend of $2.5 million for FY23.

SILK Laser share price snapshot

It's been a rough year for the SILK Laser share price.

It has fallen 36% since the start of 2022. It's also 31% lower than it was this time last year.

For context, the All Ordinaries Index (ASX: XAO) has dumped 9% year to date and 7% over the last 12 months.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended SILK Laser Australia Limited. The Motley Fool Australia has recommended SILK Laser Australia Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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