Here’s why the SILK Laser share price is zipping 12% higher today


The SILK Laser Australia Ltd (ASX: SLA) share price is soaring today following the release of the company’s trading update.

The laser clinic company’s shares are whooshing 9.5% higher at the time of writing to $2.88 apiece. However, in earlier trading, the shares hit an intraday high of $2.95. That’s a 12% jump on yesterday’s closing price of $2.63.

What did SILK Laser announce?

According to its release, SILK Laser is on track to deliver its projected EBITDA target for FY22. Ahead of analysts’ consensus, this has led the SILK Laser share price to roar during today’s session.

For the nine months ending 31 March 2022, the company achieved network cash sales of $116.6 million. This reflected a 91% increase over the prior corresponding period (pcp). It included seven months of sales from its recent acquisitions, Australian Skin Clinics and The Cosmetic Clinic in New Zealand.

In addition, like-for-like cash sales, adjusted for lost trading days due to COVID-19 lockdowns, grew to $101.6 million, up 4%.

Management noted that despite the tough macroeconomic conditions impacting the industry, the business continued to perform strongly.

Notably, a substantial proportion of the above revenue comes from injectable services (45%). This category generates higher transaction values, higher margins, and repeat purchases for SILK Laser.

The company’s franchise partner network continues to expand with three new clinics opening in 2022. It plans to open between 6 to 10 clinics over the next twelve months.

With 121 clinics operating across Australia and New Zealand, SILK Laser is forecasting FY22 EBITDA of at least $20 million.

What did management say?

SILK Laser founder and managing director Martin Perelman commented:

The foundations of the SILK business are strong, especially as we continue to expand our service mix — growing the share of the Injectables category that is especially resilient, even in a tough operating environment.

Over the past 12 months, SILK Laser shares have posted a loss of 36%. They are down 32% year to date.

The share price hit an all-time low of $2.62 yesterday.

Based on today’s improved price, SILK Laser presides a market capitalisation of roughly $139.41 million.

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