| Dental Care Alliance, Inc. | |||
| Ticker: | DENT | 1343 Main Street, 7th Floor | |
| Exchange: | NASDAQ-National Market | Sarasota, FL 34236 | |
| Industry: | Service (SIC Code 8741) | (941) 955-3150 | |
| Type of Shares: | Common Shares | Filing Date: | 8/27/97 | |
| U.S. Shares: | 2,000,000 | Offer Date: | 11/3/97 | |
| Non-U.S. Shares: | 0 | Filing Range: | $11.00 - $13.00 | |
| Primary Shares: | 2,000,000 | Offer Price: | $12.00 | |
| Secondary Shares: | 0 | Gross Spread: | $0.84 | |
| Offering Amount: | $24,000,000 | Selling: | $0.48 | |
| Expenses: | $900,000 | Reallowance: | $0.10 | |
| Shares Out After: | - |
| Manager | Tier | Phone |
| Raymond James & Associates, Inc. | Lead Manager | (813) 573-8108 |
| William Blair & Company | Co-manager | (312) 364-8990 |
| Issuer's Law Firm: | Lipoff, Rosen & Quentel, P.A. |
| Bank's Law Firm: | Testa, Hurwitz & Thibeault |
| Auditor: | Price Waterhouse |
| Registrar/Transfer Agent: | American Stock Transfer & Trust Co |
Dollar amounts in U.S. millions except for per share data | |||||
| 6 Month Ending Financials | |||||
| Full Year Audited Income | Latest Unaudited Income | Prior Unaudited Income | Balance Sheet | ||
| 12/31/96 | 6/30/97 | 6/30/96 | 6/30/97 | ||
| Revenue: | $1.64 | $2.63 | $0.54 | Assets: | $3.37 |
| Net Income: | $0.15 | $0.06 | $0.09 | Curr Assets: | $1.87 |
| EPS: | $2.78 | $1.13 | Liabilities: | $1.06 | |
| Prior EPS: | $0.08 | -$0.03 | Curr Liabilities: | $1.04 | |
| Cash Flow/Oper: | $0.27 | -$0.27 | $0.05 | Equity: | $2.31 |
| Cash Flow/Fin: | $0.27 | -$0.19 | -$0.02 | Cash: | $0.88 |
| Cash Flow/Inv: | -$0.49 | -$0.19 | Working Cap: | $0.83 | |
| Business Description |
| The company is a dental practice management company providing management and licensing services to dental practices in Florida and Michigan. The Company seeks to develop a significant market presence in each of its markets by entering into Management Agreements with established dental practices and by increasing revenues and operating income at the Managed Dental Centers. The Company provides management and licensing services to 19 Managed Dental Centers, 14 of which are located in Florida and five of which are located in Michigan. Additionally, the Company provides only licensing services to three Licensed Dental Centers in Florida. The Company's management services include personnel, operational and financial services and its licensing services include marketing, advertising and purchasing services. The dental services industry in the United States is large and highly fragmented. According to the Health Care Financing Administration ("HCFA"), expenditures for all dental services were an estimated $45.8 billion in 1995 and are expected to reach $59.1 billion in 2000, representing a 5.2% compound annual growth rate. The Company believes this anticipated growth is principally due to an increase in availability of various types of dental insurance, an increase in demand for dental services as the United States population ages, an increase in demand for preventive and cosmetic dentistry and advances in dental technology. According to the American Dental Association ("ADA"), in 1994 dental services in the United States were provided by approximately 153,000 dentists, 87.7% of whom practiced alone or with one other dentist. These solo practitioners and small group practices have traditionally managed all aspects of their dental practices, including the administrative, purchasing, accounting, marketing, recruiting and business development functions. |
| Competition |
| The dental practice management segment of the dental services industry is highly competitive and is expected to become increasingly competitive. The primary bases of competition between dental practice management companies are management expertise and experience, the elements of its operating strategy, the opportunity for career enhancement of potential associated dentists and other dental professionals, the size of the dental care network, the sophistication of management information systems, liquidity, the terms of the management agreements and name recognition. The Company currently competes with other dental practice management companies in its existing markets. There are also a number of dental practice management companies currently operating in other parts of the country which may enter the Company's existing markets in the future. Many of such competitors and potential competitors have substantially greater financial resources than the Company, have established large dental practice networks, or otherwise enjoy competitive advantages which may make it difficult for the Company to compete against them or enter into additional Management Agreements on terms acceptable to the Company. In addition, as the Company seeks to expand its operations into new markets, it is likely to face competition from dental practice management companies which already have established a strong presence in such locations. |
| Business Plan |
| The Company believes it is well-positioned to respond successfully to recent trends driving dental provider consolidation. The Company's objective is to become a leading dental practice management company in each of its target markets. To achieve this objective the Company seeks to grow rapidly through a combination of internal growth and external expansion. The key elements of its internal growth strategy are to: (i) increase revenues and operating income at Managed Dental Centers primarily through the implementation of customized marketing and productivity improvement programs and the integration of specialty service providers into its network, (ii) facilitate long-term patient relationships by stressing professionalism and the provision of high quality care, and (iii) recommend adjustments to the third-party payor mix at each Managed Dental Center to maximize productivity and respond to local market conditions. |
| Use of Proceeds |
| The proceeds from the proposed offering will be used to finance purchases of dental practices, to acquire the nondental assets of practices and for working capital and general corporate purposes. |
| Name of Shareholder | % Owned Before | % Owned After |
| SRM '93 Children's Trust | 33.00% | |
| Robert F. Raucci | 13.20% | |
| Crescent International Holdings Limited | 12.80% | |
| Curtis Lee Smith, Jr. | 10.70% |
| Officer Name | Title | Age |
| Dr. Steven R. Matzkin, DDS | Chairman of the Board, Chief Executive Officer, President and Director | 39 |
| Mr. David P. Nichols | Chief Financial Officer | 39 |
| Dr. Oscar L. Hausdorff, DDS | Director of Development | 62 |
| Mr. Mitchell B. Olan | Vice President, Chief Operating Officer and Director | 38 |